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samsun vs apple

by Wesley Burger

On Friday, September 7th, 2012, our Los Angeles office had a lively discussion/debate about the Apple V Samsung Patent Case.  Here are some of the highlights and arguments that were addressed during this discussion.  The talking points and discussion/debate were curated by Talener’s own Wesley Burger.

Background:

  • Apple sued Samsung and Samsung sued Apple

  • Lawsuit was over several patents related to mobile phones

  • Apple won a $1B judgement plus bans of certain Samsung phones and features

 Patents: Can you own a shape? (Probably not)

  • The patents Samsung infringed:

    1. 1. Utility patent ‘163. Enlarging documents by double tapping the screen.

    2. 2. Utility patent ‘381. When you scroll to the top or bottom of a web page, the display “bounces back”

    3. 3. Utility patent ‘915. Screen can distinguish between single-touch and multi-touch gestures. You can pinch to zoom in, and do one-fingered scrolling.

    4. 4. Design patent ‘087. The ornamental design of the back of the iPhone.

    5. 5. Design patent ‘305. Rounded square icons on the home screen interface.

    6. 6. Design patent ‘677. Ornamental design of the front of the iPhone, with edge-to-edge glass and a front speaker.

Samsung did not infringe a patent on the overall shape of the iPad, the 7th patent in question.

Samsung sued and lost on:

  • two  patents for wireless technology

  • a patent covered the ability to play music while using other apps

  • the ability to scroll through the photo gallery, switch to the camera to take a pic, and then return to the same point in the photo gallery;

  • letting users take a photo, preview it immediately, and email it off seamlessly.

The jury found that Apple did not infringe these with any products.

Hardware Business Models: Owning the Store/Razor Blade Strategy/Vertical Integration

  • Hollywood Antitrust Precedent: vertical integration is an issue

  • In the 1948 Paramount case, movie studios could not own theaters

  • Fits With Larger Concerns over High Profile Tech Companies as Monopolies

  • Increasing criticism of:

    1. 1. Amazon for hurting retail business

    2. 2. Microsoft for long history of cut-throat business and litigation

    3. 3. Apple for manufacturing practices in China

    4. 4. How Apple Controls What Our Clients Do

      • Process for publishing apps

      • Creating apps that dominate categories (Keynote)

 The big question: Is this outcome better or worse for mobile device innovation?

When one company defines product categories, other companies have a choice: do something completely different or copy and differentiate in the details.

Argument for better: Samsung is starting over in the short term, which will lead to real and independent innovation for them in the long term.

Argument for worse: Direct competition creates innovation; having many legitimate companies in the space will lead to better products in the long term.

“We make these products to delight our customers, not for our competitors to flagrantly copy. We applaud the court for finding Samsung’s behavior willful and for sending a loud and clear message that stealing isn’t right.” – Apple

“Today’s verdict should not be viewed as a win for Apple, but as a loss for the American consumer. It will lead to fewer choices, less innovation, and potentially higher prices. It is unfortunate that patent law can be manipulated to give one company a monopoly over rectangles with rounded corners, or technology that is being improved every day by Samsung and other companies. Consumers have the right to choices, and they know what they are buying when they purchase Samsung products.” – Samsung

Is imitation the first step on the path to further improvement or innovation?

Or is it better to start with a blank slate?

 

Discussion Notes:

Rory Bebbington and Wesley Burger lead the Los Angeles office in a discussion of the case:

  • Many thought less of Apple for pursuing litigation in the first place
  • Some said they were so far ahead they should just ignore imitators
  • All agreed that a patent on “a square icon with rounded corners” is frivolous
  • Rory cited several examples of how changes in the space resulted in deals (Trailer Park)

The group was split on how the trial’s outcome impacts mobile technology innovation:

  • Some said small companies are better at innovating

  • Daniel Nooromid discussed tech monopolies and other players in the space (Facebook, Amazon)

  • We discussed Microsoft antitrust case over IE in the 1990s

We also discussed mobile as a growing business and compared it to historical examples in other industries. The distinction between design and utility patents yielded an interesting conversation on innovation. In general, the group agreed that the law has not kept up with technology and that the current legal environment, especially as it pertains to patents, will continue to present problems.

Wesley put it to the group that we are currently in a “Wild West” period in which companies fight with each other but will soon enter a phase in which large companies face regulatory pressure from the government. These domestic monopolies will also grapple with the issues that come from entering emerging markets. Even if we all enjoy their products, these monopolies may not be the best for our larger technology ecosystem because they hoard talent, patents, and cases cash. 

We talked about what people and processes in a company influence new styles or aesthetics, comparing those factors to the work it takes to innovate on the technology itself. Large institutions like Google, Apple, or NASA may be able to make larger strides because as a whole they are better than the sum of their parts but many people (Eedan Ishak especially) believe small companies will always lead the best changes on the cutting edge and should be allowed to do so. 

We see examples of these issues with our clients. As the demand for mobile development skills increases in the LA market, our candidates wonder what technologies they should invest time in. Obviously iOS is the first priority for most of our clients but we are working more Android roles right now. As device market share shifts, we must adjust our candidate pool.

 

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