Samsung/Apple verdict: Winners and losers

Ben Uzor Jr

               

In a every battle, there is always a loser and a winner. Perhaps this fact of life played out here as the long-fought patent battle between Apple Inc. and Samsung has come to a conclusion. With the verdict largely unfavourable to Samsung, analysts expect that the new development would probably ripple across the entire smartphone industry. Apple and Samsung had accused each other of infringing on software patents. Apple’s allegations also included a few design patents. A California jury at the weekend found Samsung had infringed on the majority of the patents in question -- including software features like double-tap zooming and scrolling -- and recommended that Apple be awarded more than $1 billion in damages. On the design front, many Samsung devices were found to infringe on hardware style or icon setup.

In the words of Anderson Cooper: “anyone who has experienced a certain amount of loss in their life has empathy for those who have experienced loss.” I have experienced the loss of loved one but ironically it came at a time when everything was going on well. Indeed, I do empathise with Samsung because they have done tremendously well in seizing leadership position from Nokia in the competitive smartphone industry. Expectations are that Samsung will appeal the ruling, but as it stands currently, the verdict could significantly affect both smartphone users and other industry players. The question on the lips of every Samsung smartphone users is, what happens to my Samsung phone? Apple’s design and software claims involved scores of Samsung devices, including the Nexus S 4G and S II.

By virtue of the ruling, Apple could request an injunction against the Samsung devices that were found to have infringed on its patents. Interesting, this would also mean that Samsung could be compelled to take those gadgets off the market until they are changed. Just imagine how much Samsung will incur in losses as a result of this. However, Samsung smartphone user can look on the bright side. No one can pry the phone out of your hands even with an injunction. But it’s possible that your phone could receive a software update that changes the look and workability of the device. Michael Gartenburg, research director at Gartner, believes it could be a good thing for consumers in the long run because it would force Apple’s competitors to innovate. “Anyone who was even thinking about borrowing a technology or design from Apple will think twice about it now,” he said.

The Mesmerize, Galaxy Prevail and Infuse were among the handsets found to have infringed Apple’s patents. Other analysts point out that Apple could be the overall loser because the court case has helped boost Samsung’s profile. But more importantly, what happens to the Samsung Galaxy Tablet? This category offered one spot of good news for Samsung in this patent saga. The jury ruled that Samsung’s Galaxy Tablets did not infringe on Apple Inc’s design patents for the iPad. On the flip side, the ruling has some implication for Google Incorporated and Android? Samsung was unable to prove any of Apple’s patents invalid, which is the major point that could affect other smartphone industry heavy weights. Bolstered by an arsenal of significant patents now deemed valid in court, Apple Inc. could go on to sue other phone companies -- namely, Android maker Google and its hardware partners.

Some analysts believe this situation creates a big opportunity Nokia can take advantage of to reclaim its dominance in the smartphone segment. Samsung is the largest manufacturer of Android devices, and while the software does vary a bit across manufacturers, it’s largely similar. So smartphone makers could be sued for similar software infringements, and Google may have to tweak Android’s user interface. Taking a look at Google’s financials in the wake of the ruling, its shares were down about 1 percent in after-hours trading late Friday, last week while Apple’s stock jumped nearly 2 percent to a record high near $675. Will we see any changes to future phone and tablet hardware?

The verdict strengthened Apple’s design identity, and competitors may now be afraid to even toe the line of the iDevices’ “look and feel.” Chris Carani, an intellectual property attorney and design law expert at McAndrews, Held & Malloy, said the verdict could spark “a burst of creativity” in the design of future devices. Competitors won’t want to risk being slapped with a design infringement lawsuit, given that it costs so much money to roll out a new smartphone or tablet. “Competitors will have to go back to the drawing board, and give their designers more creative license,” Carani pointed out.

“They’ll have to create something very different as far as the visual experience, and that choice could be a great benefit for consumers.” What happens now? Does Samsung have to pay up? Before the verdict even came down, industry experts predicted that an appeal would be all but certain in this complex case. Samsung Corporation alluded strongly to that point in a statement after the verdict: “This is not the final word in this case or in battles being waged in courts and tribunals around the world, some of which have already rejected many of Apple’s claims.” The statement continued: “It is unfortunate that patent law can be manipulated to give one company a monopoly over rectangles with rounded corners.” On the other hand, Apple was excited with the ruling.

“The mountain of evidence presented during the trial showed that Samsung’s copying went far deeper than even we knew.” Samsung has to be sorely disappointed, but it has enough cash to handle the $1 billion ruling with relative ease: It earned $12 billion last year and has $14 billion in cash in the bank. If Samsung does choose to appeal, it’s unclear what timeline that move will follow. The case involved 109 pages of instructions, a fact that made headlines, although in a surprise move, the jury came back with a verdict after only three days.