After trying and failing to register the term “Tweet” with the USPTO, Twitter will likely soon acquire the trademark rights for the term. Twitter has been in negotiations with the owner of the mark, Twittad, for some time and the parties have finally settled on terms that will transfer the trademark to Twitter. For full details, check out this explanation over at TechCrunch.

What makes this story even more interesting is that Twittad is a third-party developer of Twitter’s API and was able to register “Tweet” before Twitter – even though Twittad was using “Tweet” in reference to Twitter’s use of the term.

There are several take-aways from this story. First, Twitter smartly created language to use on its website, most importantly with the word Tweet. However, it made the mistake of not initiating trademark registration before Twittad. For new products and services, it may not seem imperative to register for trademarks right away, but then real examples like this occur and it ended up costing Twitter an undisclosed, but likely substantial amount of money to obtain the trademark rights.

Second, this story acts as a cautionary tale for technology companies that allow third-party development and then allow those developers to use their trademarks. Those companies have a need to be proactive in what they allow third-party developers to do and how they use their trademarks. Since the “Tweet” trademark issue first began, Twitter has heavily beefed up its protective plan and has published an in-depth trademark usage guide, a highly advisable tactic in the fast-paced world of technology mixed with third-party development.