This is probably not entirely surprising. The European Commission has announced that it is investigating both Apple and Samsung because they may have breached antitrust rules with regard to patents used as standard in the mobile phone industry – otherwise known as FRAND patents. While the EC states it’s investigating both Samsung and Apple, it’s likely the investigation focusses on Samsung.
The European Commission’s statement was fairly short and to the point. “The Commission has indeed sent requests for information to Apple and Samsung concerning the enforcement of standards-essential patents in the mobile telephony sector,” the EC said in a statement, “Such requests for information are standard procedure in antitrust investigations to allow the Commission to establish the relevant facts in a case. We have no other comments at this stage.”
It’s very likely that Apple is the one who asked for this investigation. After Apple attacked Samsung with several software patents and community designs (upheld in Germany, dismissed in The Netherlands), Samsung defended itself in several countries, claiming Apple infringed several of its 3G-related patents. The issue is that these patents are essential to the standard, and therefore, must be licensed under fair and reasonable terms.
Unlike what some are saying, it is definitely not against the law or in any other way illegal to sue for possible infringement of FRAND patents. When two parties are negotiating a FRAND license (like Apple and Samsung were doing), and the FRAND patent holder believes the other party is not accepting a valid FRAND offer, then the patent holder may definitely take them to court. This is exactly what Samsung did.
However, this is where Samsung went wrong; the Dutch judge basically labelled Apple and Samsung a bunch of squabbling kids, and sent them back to the negotiating table, stating that Samsung’s offer was not FRAND, because the licensing costs Samsung asked were out of line with the industry standard. Consequently, Apple is now claiming that Samsung is engaging in anticompetitive practices by suing over these FRAND patents.
The EC is apparently investigating this issue now, and I can only see that as a good thing. According to the EC’s statement, they’re investigating both companies, which hopefully indicates that the entire back-and-forth between the two companies – which is hurting consumers, the only people that should actually matter – is held under closer inspection.
While I loathe Apple for abusing software patents and community designs to stifle competition in Europe, that’s not a free pass for Samsung to abuse its FRAND patents. The best outcome here would be if the EC put both Apple and Samsung in their place. In the end, the EC should care about consumers, and not the bottom lines of an American and a Korean company. And let’s face it – not a single consumer benefits from the two companies blocking each other’s products from the market, or from the fact they’re wasting money on this instead of on actually, you know, making products.
Let’s hope the EC tears both companies a new one. I’m sick of this anti-consumer bull%$&#.
Samsung’s price is up 4% and Apple’s is down 3%. This suggests that Apple is in more trouble than Samsung.
Investors are worse than the parties involved – they can’t even be labelled as squabbling kids.
They are panicky idiots most of the time.
A ban on iOS devices would be an unmitigated disaster for Apple.
Samsung without Android is still a $300 billion corporation.
That is how the markets think.
Apple’s strategic aim is not to block anybody’s products per se. Apple’s aim is to retain differentiation of it’s products through preventing what it sees as copying of elements of it’s designs that it has patented or which it feels it owns.
Leaving aside whether one thinks Apple is correct in it’s view or justified in it’s actions the principle that companies cannot simply adopt another company’s patented or copyrighted technology or designs or innovations without permission whenever they feel like doing so is a principal that supports innovation. If innovation never brings any advantage in the market place because one’s innovation can immediately be stolen or copied then why bother? Allowing unlimited or unconstrained copying will kill innovation because innovation will no longer bring any market or business advantage.
It is surely essential for innovation that being innovative brings something other than fleeting advantage, something more than a momentary advantage that only lasts until your competitors can copy anything you have created or invented. Being innovative is difficult, costly and demanding. Innovation will only happen if it leads to some advantage.
I welcome the patent wars, there are always patent wars at moments of great change and inflection because it during such periods of intense change that innovation and invention become most valuable. Let them all fight it out, let’s support the principal of the protecting of IP and let the courts, the lawyers and juries decide who has a case or who doesn’t.
Edited 2011-11-05 00:44 UTC
You make a spoon, and I’ll make a spoon. I’ll see you in court if yours looks or functions remotely similar to mine.
I’m Ford, I make a car design, patent it, and bring it to market. You’re Hyundai, you see my car and you make a very similar one who’s design only faintly differs from mine. Since you didn’t have to prototype the design like I did, you were able to cut R&D costs to a great margin because I essentially designed it for you. So when you take your car to market you’re able to undercut my profits. I take you to court. Let’s see who wins.
How much you sunk into R&D is not a measure by which patents are granted nor should be granted.
And please, please, please…. Hardware related patents are in a totally different universe to intangible IP. They are much easier to define, identify and protect.
So hardware deserves protection, and software doesn’t?
Innovative designs on a hardware level are valuable, but on the software level they aren’t?
You’re valued and appreciated as a hardware company, but you’re dismissed as worthless as a software company?
With more and more innovations being built around software, rather than hardware, I think thats selling a lot of people short.
How the ***** did you come to that conclusion? Reduction ad absurdum will not help in this case, since I’ve been in the US patent game and know it from the inside. Those are some benefits of working at IBM(formerly).
Then I must be selling myself short. And my profession. And so on…
Don’t be ridiculous…
So patents aren’t ridiculous either. Don’t throw away the child with the bathwater.
In the current state we are better off without any form of software patent till something acceptable is on the table.
And being afraid to throw away a dead baby with the infected bathwater will only lead to more contamination.
(The dead baby is the software patent, infected water is the current system)
Who says throwing away dead babies and infected badwater won’t lead to global contamination?
Seriously though, it won’t happen and you know it.
It will not stop me from talking about it and will definitely not stop me talking to my MEP acquaintances and my parliamentarians.
I can’t leave the decision to uneducated people, it’s better that they know both sides of the story rather than one.
The Honda Jazz and Mitsubishi Colt are blatant copies of the Mercedes A Class. The Lexus I series are copies of 3 series BMWs.
No one gets sued in the car industry for copying designs. They swap IP readily. They only sue over trademarks.
I’d like to see you bring to market a Lexus which looks almost exactly the same inside out like a BMW 3 and not get sued by BMW.
Swapping IP doesn’t come without a price. Its still up to the individual IP holder if they’re willing to swap it or not. If they don’t, you need to respect that, not do it anyway and not pay anything.
Totally wrong. Apple has adopted an ultra risky portable device strategy which is rapidly evolving into a potential catastrophe. Obviously Steve Jobs learned nothing from the original Mac fiasco.
Apple is now facing a slew of Android devices that cover every market segment from top to bottom.
In Australia at the moment the price discrepancy for similar products is huge.
– LG Optimus Spirit unlocked – $149
– Samusng Galaxy 5 unlocked -$99
– Apple 3GS unlocked -$ 429
– Motorola Xoom 32GB -$499
– iPad 32GB 32GB (wifi +3g) – $839
– Samsung Galaxy S2 unlocked – $549
– iPhone 4S unlocked – $899
Telstra – Australia’s largest Telco – sells unlocked Telstra (Huawei) Smart-Touch Android phones for $79. This is cheap enough to give to a child.
Apple is panicking because they know they will get absolutely clobbered within two years (I predict much sooner). The lawsuits are merely the desperate actions of a company that suddenly realises they can’t compete on price and have no compelling technology to attract buyers.
Edited 2011-11-05 04:57 UTC
Apple is the biggest company (by market cap) on the planet. It is the most valuable brand on the planet. It makes the most profit of any other company on the planet in handsets, tables, computers, displays, music, etc. It has the best customer service (as voted by actual customers) for an untold number of years. It has the strongest customer loyalty (especially in mobile devices). It makes the most money per retail square foot of any company on the planet. It commands 60% of mobile OS traffic.
I could go on here.
Clearly those are indicators of a disaster waiting to happen.
So was GE a decade ago. It is now down around 80% in inflation adjusted terms.
Sounds just like RIM in 2007. Rim is currently facing disaster.
Companies are frequently extremely profitable and growing rapidly just before they collapse. eg Enron.
Apple Inc. is currently rated as having Very Aggressive Accounting & Governance Risk (AGR). This places them in the 8th percentile among all companies, indicating higher Accounting & Governance Risk (AGR) than 92% of companies.
AGR scores are based on statistical analysis of accounting and governance risk factors. Lower scores indicate heightened corporate integrity risk, indicating an increased likelihood of future class action litigation, material financial restatements or impaired equity performance.
http://finapps.forbes.com/finapps/AccountingRisk.do?tkr=AAPL
Translation: Apple is at very high risk of going belly up.
Edited 2011-11-06 23:31 UTC
Android tablets have been a dud in the marketplace sofar. Have you ever used a Xoom? Its a piece of shit.
Ipod and Iphone weren’t popular because of innovation. They were popular because of the complete package. And that is how most products compete with each other.
Having a big touchscreen instead of buttons isn’t innovative by the way it is completely obvious.
AFAIK the Star Trek Tricorder had a big touchscreen back in 1966.
But we’ll probably never know if it had multitouch, slide to unlock, inertial scrolling or an App Store.
Yeah, it even had an app store and ran an early beta of iOS 6.
And it was made of wood.
Sure it was. Have you ever used MP3 players from the time before the iPod came out? I have. If you had, you’d remember how awkward they were. The iPod was a delight to use in comparison. It had simple controls trough an innovative click-wheel which made navigating it a breeze. It held a lot more songs due to its unique tiny hard disk, and it was well built.
If it was completely obvious, why didn’t anyone else think of bringing it to market in the way as the iPhone did? Before the iPhone, almost all smartphones had buttons. Many executives laughed at the fact the iPhone didn’t have any. Nowadays you’ll be hard pressed to find an Android which still has a keyboard.
Its easy to state something is obvious after it has happened. People seem to forget that there actually was a time where we didn’t have the current form factor and functionality in a mobile computing device.
Yes. iPod made it easier for normal people to put music on the mp3player. It changed nothing for me. I also had a harddisk mp3 player before the ipod.
Changes often occur because a device is used differently or a new technique becomes cheap enough. If you want to use a device to listen to music, browse the web, have apps and be used as a phone how many choices do you have for formfactor?
Just because most phone vendors were being stupid doesn’t make Apple brilliant.
I watched the market for a couple of years, wanting to buy an MP3 player. I’m choosy, and when I’m uncertain, I end up not buying anything. Back in the day when I first looked, you had either these tiny storage space devices with tiny displays, or bulky ones with enough space that weighed like a brick. When I saw the iPod, I knew instantly it was the device I had been looking for. At the time it was launched, it made the best trade offs between space and size.
Component price is closely related to its volume. Larger volumes make cheaper components. To achieve volumes, you need products which are appealing enough to customers. A new component is worthless without an application, it will just end up as being an interesting footnote in the history of components. So good products drive the component market more than most people realize.
Lack of imagination inhibits lack of possibility. You’ll never find out if everyone just does the same thing. The Blackberry has internet, apps, and is a phone. It was a successful product in its day. Yet the iPhone didn’t copy the Blackberry. they made a new design instead.
One could argument that brilliance is relative to one’s surroundings, but thats another matter.
When it comes to third party components, I do think it takes a not unreasonable amount of brilliance to recognize and value them, realize what they are capable of, and have the insight in putting them together in a new product.
The CD player was patented in 1969. It reached the market in 1981. The delay was due to the fact that the hardware was too expensive to build any earlier.
Dick Tracy had a two way wrist radio back in 1946 and a wrist TV in 1964. back in the 1940s.
Someone had probably thought of some type of touchscreen mobile phone by the 1960s.
What are you trying to say? CD players aren’t iPods. wrist radios aren’t either.
Its a big difference between thinking something up and actually building it. In fact I can imagine a computer that will plug into a socket after my ear, after which my brain is instantly connected to the internet. No screen, keyboard, or touchscreen required. The computer in itself is as big as a mentos and has 50 TB of solid state storage. Knowing how to turn that vision into a real product however, is the difference between sci-fi and the real world.
Companies typically plan products many years ahead. Once the technology becomes cheap enough they build.
Cheap touchscreens became available so touchscreen phones were marketed.
The iPod and Mac designs design were blatantly stolen from 1960s Braun catalogues.
The iPad is a direct copy of the 1987 Knight-Ridder concept tablet.
The iPhone is a copy of the LG Prada.
Edited 2011-11-06 23:51 UTC
I didn’t know Braun was in the computer and mp3 player business in the 60’s.
FrogDesign developed the original Mac case. Jonathan ive designed the iPod case.
LOL
The Prada was announced one month before the iPhone. Its quite daft to say it copied the Prada, since the iPhone had been in development for at least 2 years before that.
Edited 2011-11-07 00:59 UTC
BS.
The Apple designs are blatant copies of designs by 1960s German designer Dieter Rams.
http://gizmodo.com/343641/1960s-braun-products-hold-the-secrets-to-…
Apple is a corporation that has always stolen and dishonestly appropriated other people ideas and claimed them as their own – GUI and mouse(Xerox), OSX (BSD) etc.
Stebve Jobs was a liar, sociopath, thief and criminal (all detailed in Isaacson’s biography). Jobs offensive personality and his dubious “values” have permeated every pore of the Apple culture.
So Apple travels back in time to compete with CRT TV’s, closets and radiators? WOW! I wasn’t aware of that.
http://en.wikipedia.org/wiki/Frog_Design_Inc.
You’re deluded. Besides, Apple doesn’t even compete with Braun. Google competes with Apple directly.
GUI and mouse (Xerox) : Its not stealing when the original company gave it to you. They didn’t stole it. they worked out a deal and got shares. Xerox, however, did not get any shares from Microsoft after copying the Mac UI, nor did Apple, for that matter.
OSX (BSD) etc : Any commercial product is entitled to use BSD as a basis for their products. Why wouldn’t Apple be excluded? Besides, they also open source quite a bit of their own stuff.
Finder touch oriented UI – I will give that to Apple. For bringing it to the market that is, not inventing it or anything even remotely similar.
The LG Prada had a touchscreen before the iPhone.
Android began two years before iOS.
Yeah, and for two years, it looked like a cheap knockoff of a BlackBerry. Then the iPhone came along, and they adopted the look and feel of an iPhone knockoff.
Total BS. There are demonstration videos of Android running a touchscreens GUI long before the iPhone was announced.
BTW When is your messiah Steve Jobs going to be resurrected?
Edited 2011-11-07 05:01 UTC
No there weren’t. Prior to the iPhone, there wasn’t any noteworthy touch functionality present in Android.
Let me show you some prototypes of Android :
http://media.techeblog.com/images/androidlive_1.jpg
http://cdn.slashgear.com/wp-content/uploads/2011/08/google-android-…
Pretty much seems like a Blackberry to me.
It seems zealotry pretty much causes acute myopia.
http://www.youtube.com/watch?v=1FJHYqE0RDg#!
There were 2 prototypes: blackberry like one and iphone like one (starting from 3 minute mark).
That video was from 2008. And you can see clearly from the video the touch screen functionality is very early stages and its basically still the button-based UI with some modifications.
I guess Android can’t compete unless it leeches on other, successful designs.
Android demonstrated both GUI and keypad versions of their OS before the iPhone was released.
Some Android phones still offer keypads.
You are the only zealot making unfounded statements.
This is related to a rather public trial on a publicly visible issue within the EU. So whatever you might think, there is a lot of place for public comments. If you remember, the laws aren’t created by labrats and handed down to us on tablets.
Sorry to break it to you, but innovation is not patentable by legal definition. In reality some insane patent offices issue patents for innovations and disregard the requirement for an inventive step, but that is another issue.
Practical designs are. An innovative product is characterized by a clever implementation. The Apple disk II was characterized by a clever design because it used fewer chips and so it ended up being cheaper to produce.
I haven’t been following this in any detail but I’ve heard Samsung was not using FRAND patents, but other related patents that are not part of the standards.
They’ll all kiss and make up eventually – big companies suing one another is not exactly new.
How is this fair?
Company invents technology essential to mobile phone industry … has to share it with everyone.
Apple invents a rectangle … gets to sue everyone over it.
There’s only one thing EC should do and that is abolish software patents. Make it EU law and mandatory for all member states. I don’t give 2 cents about what one dutch judge may or may not say.