Following a recent UK court case that ruled that Microsoft's use of the SkyDrive name infringed on a trademark owned by British Sky Broadcasting Group (Sky), the two companies have agreed to a settlement that will see Microsoft's rename its cloud storage service worldwide.

As part of the agreement Microsoft has agreed not to "pursue its planned appeal of the decision" and Sky will allow "Microsoft to continue using the SkyDrive name for a reasonable period of time to allow for an orderly transition to a new brand". The agreement also contains " financial and other terms", but the details are confidential. Microsoft has yet to reveal a new name for SkyDrive, but will likely look to tie in with existing Microsoft branding.

In the press release Sky is quoted as saying:

“We are pleased to have reached a settlement after Microsoft agreed not to appeal the trade mark infringement judgment in relation to its SkyDrive service. We will remain vigilant in protecting the Sky brand and will continue to take appropriate action against those companies who seek to use our trade mark without consent.”

To which Microsoft adds:

“We’re glad to have resolution of this naming dispute, and will continue to deliver the great service our hundreds of millions of customers expect, providing the best way to always have your files with you.”

In the UK the Sky name is associated with a satellite broadcast service (generally referred to as "Sky"), which has a number of Sky branded channels (e.g. Sky Sports, Sky Movies, Sky News). Sky is also available in a number of other European markets and the Sky News channel is available internationally.

SkyDrive, which Microsoft first launched in 2007, has become an increasingly important part of Microsoft's platforms. On Windows Phone the cloud storage service is deeply integrated into the platform (e.g. used for storing backups, settings, and auto-uploaded photos) and is also one of the locations for storing Office files. There's also a SkyDrive app for Windows Phone that provides access to additional files and sharing functionality.

SkyDrive is also integrated into Windows 8, and will be further integrated with the release of Windows 8.1, which will see SkyDrive effectively become an equal of local storage.