Apple’s Has Won The Battle, But Has It Won The War?

By Ryan Borja

iPod manufacturer Apple has won the first round in its case against Samsung over patent violations in a court case in the United States.  The decision drew mixed reactions from experts who weighed in on the  verdict and what the decision would have on consumers.

Apple has been awarded more than US$1 billion in damages after convincing a jury in California that it is the genuine owner of up to six out of seven innovative features that Samsung integrates in to its smart phones and tablet devices.

The ruling in the US could bring wide-ranging impact to the mobile sector and on both companies’ respective consumers, too. There are several similar court cases going on between the companies around the world including in Germany and France.

An analyst, Horace Dediu of market intelligence site Asymco, believes consumers will not see much change overall nor the demand will change as a result of the trial. He said that Samsung relies heavily on distribution of their phones via a large network of vendors, and that while Apple does as well, it has less than half of Samsung’s footprint. He indicates that operator’s reactions are vital to determine the impact to supply, which will have a bearing in both companies’ performance that will affect consumers.

“The question for operators will be whether there is any risk involved in working with Samsung going forward,” he said. “If they perceive a risk then they will move some of the shelf space to competitors, such as Nokia. Somehow, Samsung has spent over $9 billion in advertising but it also benefited from the trial exposure. “

Although the key patents in contention include touch functions that allow users of Apple devices to easily scroll pages, and zoom out on images or tap to enlarge text, the biggest concern regard the verdict is the dent it has put in the Android operating system, the Google platform that powers many Samsung devices.

Analyst Robert Enderle, principal of the Enderle Group, said that unless something changes, “most Android products will likely be pulled from the market to avoid similar penalties within 30 days to avoid additional penalties … [and] there may be crippled Android products that will see sharp price drops to get rid of inventory.”

In the long run consumers could be affected by the monopoly Apple has on these patents in two ways – charging what they like for their products with the technology, or allowing other vendors to use their product, but charging a royalty that third-party vendors – like Samsung – will pass on to consumers.

In its issued statement through a spokesperson, Apple’s sentiment is that originality trumps money or patent rights. It adds: “At Apple, we value originality and innovation and pour our lives into making the best products … to delight our customers.”

Samsung, meanwhile, in an earlier statement said that the "verdict should not be viewed as a win for Apple, but a loss for the American consumer."

Samsung still has an Australian case pending against the Cupertino-based company that is due to resume next month, while an Apple filing versus Samsung is set down for 2013.

The verdict’s timing looks favourably positive for Apple, which is expected to launch its next generation iPhone in September to claw back its lead in the smartphone sectors which Samsung has come to dominate in the past year.

 

 

 

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