Trial Verdict Could Benefit Samsung More Than Apple, But Not Consumers

Despite winning more than $1 billion in its trial against Samsung, Apple’s victory may backfire.

A US court has ordered Samsung to pay Apple $1.05bn for infringing intellectual property. However, Apple’s victory may backfire. Photo: Dekuwa/Flickr

Apple won more than $1-billion in the case Friday, after a California jury found the South Korean electronics giant infringed on dozens of patents held by the iPhone and iPad maker, reports Mail&Guardian.

The court also upheld the validity of a series of Apple patents, many of which related to the design of the iPhone.

“We are grateful to the jury for their service and for investing the time to listen to our story and we were thrilled to be able to finally tell it,” said Apple spokesperson Katie Cotton in a prepared statement.

“The mountain of evidence presented during the trial showed that Samsung’s copying went far deeper than even we knew. The lawsuitsbetween Apple and Samsung were about much more than patents or money. They were about values.”

However, in a Saturday post on Google+, Enrique Gutierrez, chief technology officer of Digithrive, a Los-Angeles based Internet development and design firm, describes sitting in a Starbucks, and overhearing four separate groups of people make the same conclusion about the Apple-Samsung verdict: that the two companies are effectively one and the same.

“They don’t know the details, they don’t really care, what they know is Apple is saying that Samsung is the same as Apple,” Gutierrez writes. “And with one simple Google Search, you get prices that are basically half for what seems to be the same products.”

According to Mashable, one husband-and-wife duo expressed shock at the former’s comparatively cheap retail price tag of $700. The couple even considered returning their iPad after looking up Samsung’s tablet online.

“‘Samsung’s iPad is the same as Apple’s iPad, and I paid how much for the Apple one? Honey, I told you they were a rip-off,’” the husband said.

Tech expert Robert Scoble says the verdict also benefited Samsung, but for different reasons. On his Facebook page, Scoble says copying Apple was a smart business decision.

“I think this is actually a sizable win for Samsung. Why? It only cost $1 billion to become the #2 most profitable mobile company,” he writes.

And, as Gutierrez concludes: “Best billion dollar ad campaign Samsung ever had.”

Meanwhile, the decision can turn to be harmful for Google. Although Google was not a party in the case, it makes the Android operating system which was central to the case – a system which Apple’s late co-founder Steve Jobs called a “stolen” product.

“I think this will force a reset on Android products as they are reengineered to get around Apple’s patents,” said Rob Enderle, a technology analyst and consultant with the Enderle Group.

Analysts say that aside from Samsung, Google could be the big loser, especially if Apple pursues its litigation against other manufacturers.

“Google cannot stop Apple. It is now on the run and will have to scramble to make software changes to Android,” Mueller said.

“In a few years, the San Jose jury verdict may – I repeat, may – be remembered as the tipping point that sent Android on a downward spiral.”

In recent months, Android devices have grabbed more than 50% of the US smartphone market to around 30% for Apple, while RIM’s shares have slid to around 12%.

The court ruling, said Enderle, “should provide a stronger opportunity for both of Microsoft’s new platforms – Windows 8 and Windows Phone 8 – because they come with indemnification against Apple, suddenly making them far safer and possibly a faster way to get product to market.”

The decision also “will make RIM far more attractive as an acquisition because RIM’s patents are thought to be strong enough to hold off Apple,” Enderle said. “Both Samsung and Google may make a play for the company, and both Microsoft and Apple may move to block them.”

However, for consumers, Apple’s sweeping patent victory over Samsung could mean fewer choices of mobile phones and tablets and higher prices in the short term but more innovative and distinct gadgets over the long haul, legal and industry analysts said.

“Clearly this ruling sets a precedent for the future of mobile device design,” said Chris Jones, an analyst with Canalys, a market research firm that focuses on the mobile industry.

According to Contra Costa Times, while the findings of the jury in the Samsung case aren’t binding on other disputes, Santa Clara University law professor Brian Love said the verdict will be “persuasive” in convincing lawyers for other smartphone manufacturers that they could face a fate similar to Samsung’s.

The verdict — and subsequent suits or settlements — could also force Samsung and other companies to pull some of their products off the market.

Android smartphones and tablets may also start to cost more. Apple rivals are likely to try to license the company’s patents, something that would raise manufacturers’ costs, said Ken Dulaney, a wireless industry analyst with market research firm Gartner.

“I think this means higher prices,” said Dulaney. “Probably not a lot, but they will rise.”

Judge Lucy Koh set a September 20 hearing where she will consider whether to overturn or modify the jury verdict, whether to impose “punitive” damages which would triple the award and whether to issue injunctions against Samsung.

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