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Facebook Is Being Sued Over Its Portal Brand

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Startup claims trademark infringement

According to Reuters, Facebook (FB) has been hit with a trademark infringement lawsuit over its use of the Portal brand. The lawsuit was filed in Manhattan by a New York startup called Mass Lab, which built a video-sharing app called Portal.

In October 2018, Facebook launched a hardware product called Portal, which it’s promoting as a video-calling device. Portal is available in two versions with a starting price of $200. The high-end version costs $350. In addition to making video calls, owners of Portal can use it to stream music from providers such as Pandora (P) and Spotify (SPOT).

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A $23.3 billion revenue opportunity

With Portal, Facebook is viewed as pursuing revenue in the smart speaker market, which Allied Market Research estimates will be worth more than $23.3 billion by 2025. The market was estimated to be worth $4.4 billion in 2017.

Besides Facebook, the other companies pursuing smart speaker revenue are Amazon (AMZN), Google (GOOGL), Alibaba (BABA), and Baidu (BIDU). Amazon is currently the world’s top smart speaker company, holding a 31.6% share of the market in the third quarter of 2018, according to data from Strategy Analytics. Google, Alibaba, and Baidu held shares of 22.7%, 9.5%, and 8.4%, respectively, in the global smart speaker market in the third quarter.

Portal opens up another source of revenue

In addition to being an extra source of revenue, Portal is also viewed as important to Facebook’s efforts to diversify its revenue sources, as the company currently depends on advertising for the vast majority of its revenue. The trademark infringement lawsuit could affect Facebook’s plans for Portal, so it will be interesting to see how the company handles the dispute.

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