Sympathy for the Devil…?

Please allow me to introduce…, or rather bore you with a blog post that is mainly intended to sort out (for myself) all the things that go through my head when I study Apple’s recent court victory over Samsung. There are a few things that I find quite interesting with this case, so let me go through a few of them.

First thing that springs to mind is that although there is a verdict from the court we are not really closing this case, on the contrary we have just read the prologue of a book with many chapters to come. From all the various experts commenting on the case it strikes me that we are not that much clearer on what the next steps are and what the consequences of the verdict really are.

Samsung and its expensive lawyers had at least 1 Billion reasons to somewhere on earth find an iPhone look-a-like phone pre-dating the iPhone, or at least a rectangular shaped phone without a keypad. They didn’t! Although the common wisdom seems to be that no one should be able to patent something as trivial as a rectangular shaped phone without a keypad, it’s a good reminder that they actually didn’t exist before the arrival of the first iPhone.

Another interesting matter is that Apple has only targeted Samsung in the court case. We should remember what the late Steve Jobs said to his biographer. “I’m going to destroy Android because it’s a stolen product. I’m willing to go thermonuclear war on this.” Although many observers accept the official statements from Google on this case as genuine, i.e. the verdict does not apply to or involve Android, it’s hard to believe that Apple won’t seek an angle to go after Android and Google in coming chapters.

Coming back to lawyer tactics, I find it quite surprising that Samsung in its counter claims on Apple tried to convince the court that it should have the right to collect 2.5% of iPhone sales price in license fee for its essential IPR’s. That was really a lost case from start since essential IPR’s have to be licensed on FRAND bases. Was that a desperate move after getting 0 hits on “rectangular shaped phone without keyboard before 2007” on Google search?

Joking aside, far and beyond any other aspect of the case, we’re likely facing a huge problem in the mobile industry. Already before the jury came with its verdict we had a situation where Apple and Samsung collectively generate 99% of the profits in the handset industry. With the court verdict it could even go up to 99.9 or 100%. When we look at the handset sides of company’s like HTC, LG, Sony, Huawei and ZTE they have a few things in common, they are loss making (or marginally profitable) and they are using Android as OS. The last thing they need is Apple suing them in a court, additional license costs, redesigns or changing to another OS that Apple does not like to destroy. Variety of choice and competition is tremendously important for the mobile industry, but given what’s going on it’s hard to see how this can be realized over the next couple of years.

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