What I think is fundamentally wrong with the way the patent system is applied today is that in many instances it serves as nothing more than an artificial monopoly only benefitting the patent holder.
The idea of the patent system in itself is actually quite elegant. Government grants a temporary monopoly in exchange for the public disclosure of an invention. Everyone wins! The person issued the patent can more easily profit from their invention because they can work in the open. Society likewise benefits, no more secret guilds locking up knowledge, now everyone can see how it's done (and apply it once the monopoly expires).
As a social contract this really makes sense. The problem is that a lot of the patents being thrown around today only really satisfy half of that contract. A temporary monopoly is indeed granted, but the disclosure received in exchange is worthless information. I say it is worthless because no one actually needs to read that disclosure to figure out how to do it themselves with basically no effort.
Of the large companies, it seems to me that Apple is one of the worse offenders at exploiting the patent system in this way. Don't get me wrong, what they are doing is perfectly legal, but that doesn't make it OK. It does seem like Apple is following the legal rules and Samsung is thrashing around attempting to break them (perhaps feeling they have little alternative). But that doesn't mean that our legal system is perfect and cases like this will hopefully help us understand how it can be fixed to prevent this kind of exploitation in the future.
Even at the risk of sounding like a broken record...
Public disclosure is only part of the story. The other part is to allow protecting the cost of an invention. If there was no protection there would be less incentive to invest in r&d to come up with new idea.
This is where the problem lies with software patents (IMHO): A "software invention" does not cost anything.
I will lean out and say that there is no idea in software that is worth anything by itself.
Instead it is the expression of that idea that has value, and that is protected by copyright.
(I'm still waiting to be shown a software patent of an idea that would not have seen the light of day without a legally granted monopoly)
"I'm still waiting to be shown a software patent of an idea that would not have seen the light of day without a legally granted monopoly"
Are you saying that "software type people" will always release their ideas publicly cause they are just cool or are you saying that software is so intrinsically intuitive that any concepts unique to software will just come about?
What I am trying to say is that all software patents I've seen so far are for "epiphany" type ideas. Ideas that did not need an elaborate initial setup or have any cost associated with them. Ideas folks have in the shower, etc.
Hence society as a whole does not benefit from these monopolies because folks have these ideas anyway. The cost of software lies in the implementation, which is protected by copyright.
You are right, though, I glanced over the point that patents allow you to publish your idea without fear that somebody else will beat you at your own idea. That again is provided that the idea is actually unique and other folks could not just come up with it as well (in the shower :) ).
IMHO the bad of software patents far outweighs any good that can come from them and the only folks who benefit greatly are lawyers and companies that would like to prevent each other from competing.
"Ideas that did not need an elaborate initial setup or have any cost associated with them."
Ahh. I see. Ok. Ya. I had an "epiphany" idea in software. Invested quite a bit in R&D to see if it worked. It did not. A while later, had an epiphany on the epiphany and so on.
The final solution, which is patent pending, took me quite a few years and quite a bit of money (not including opportunity costs) to figure out. It could be I'm just not that smart and that is why it took me so long. However, I've never seen anyone implement this type of technology. No patent, startup, software that exists already. I've seen people over the last 20 years try to solve the problem I've solved, but without success.
Would this fall under something that should not be patented?
Yeah, that's an interesting case then.
Without knowing the idea it is hard to say.
The key question (IMHO) is whether a patent on this would be in the interest of society as a whole. I.e. would you still try to make the idea work even if there was no patent? Or would you not even try to development anything around this because of the fear of somebody stealing your idea and making money with it?
Initially, if I did not have some kind of IP protection, I would not have taken any risk of going forward with it. I would have chosen something a lot less risky.
However, after the fact, it really doesn't make much difference. Now, I would rather have the IP protection to assure openness and standards.
At least in the United States, the express purpose of all patents, copyrights, trademarks, and other IP protections is "To promote the Progress of Science and useful Arts", i.e. for the public good. The vehicle used to achieve this end is the granting of a temporary monopoly, but the monopoly itself is not the end.
Absolutely right. I was just trying to point out that the monopoly in this context isn't some sort of dysfunctional side-effect, but part of the intended mechanism.
As another poster indicated, it is to benefit society. This makes a lot of sense on a practical level. If society is going to expend energy protecting such monopolies, it should be getting something in return.
It seems that the letter of the law has failed to achieve this. I'm not saying this is an easy problem to solve, however it is becoming a bigger problem as big companies commit more money to use these laws in ways that miss the original intent.
As such there is an increasingly urgent need to address the issue and revise the old straining laws with the experience gained in order to protect the original intent.
Well, the patent holder is either the inventor or acquired the patent from the inventor. If we assume that the inventor is a consenting adult and didn't give the patent away under duress, I don't see any problem with that.
Where does the patent troll company get the patent? Either they invent something or buy the patent from an inventor or from someone who bought it from an inventor.
The problem with patent trolls is that they are too often working with patents that shouldn't have ever been granted in the first place, and that it's so expensive to defend against a lawsuit, it makes sense to just settle silently.
There are many things wrong with the current implementation that can be fixed without throwing out the whole notion of intellectual property protection for inventions.
Especially now that the US has moved to a first-to-file system, there's no guarantee that the patent holder is the inventor. Separately from that, some patent troll companies file obvious, overbroad patents without implementing them (e.g. the classic case being doing <X> on the Internet, of course) to build up their stockpile. Just because they might end up with some patents when their junk sticks doesn't make them an inventor.
If we reformed the system to force the patent holder to actually market a real product using the patent in order to be able to sue to defend the patent, making them more similar to trademarks, this would solve the pure patent troll problem. Unfortunately it wouldn't stop the mobile patent wars.
I disagree that it is an elegant solution. Ideas are something that have a resource cost to conceive, develop and disseminate, but which have no cost to the developer afterwards. The more people who use an idea, the better from an economic standpoint, because the use of an idea is not a finite resource like, say, water.
Therefore, the economic properties that you want are to, on the supply side, reward people who produce ideas - an the patent system does that - and on the demand side, to encourage as much appropriate use of the idea as possible, which is the opposite of what the patent system does.
A monopoly is therefore inappropriate. A system where product developers pay the same amount into a pool regardless of how many patents they use, and have to declare truthfully what patent documents they referred to for the purposes of distributing the pool would work far better. That way, products would have no reason not to use all the newest technologies, but people who file good quality patents would still get paid.
If things are sold beyond their marginal costs, something is broken. We need other funding mechanisms for research and development like the Stiglitz prize system, or Dean Baker's artistic freedom voucher.
If things are sold beyond their marginal costs, something is broken.
I think this is too simplistic and labor centric. At the very least, the number of people who can benefit from a particular kind of work should affect the value of that work, should it not?
> A temporary monopoly is indeed granted, but the disclosure received in exchange is worthless information.
Given some of the frivolous patents granted these days, and given the application process itself, I wonder how many companies spend more to obtain the patents than they do for the R&D on the technology that's being patented.
Apple $2.4 billion $R&D, $2.6 billion for their share of Rockstar Bidco (Nortel patents)
Google $5.2 billion R&D, $12.5 billion Motorola Mobility. Note that Google still qualifies even if you just count the Motorola "patent spend" at Google's recent $5.5 billion valuation of Motorola's patents and technology, rather than the cost of the whole acquisition.
You do know that Apple does most of what can be classed as R&D through its normal P/L operating units. So it's not like there is a separate iOS R&D team specifically churning out patents. Patents can and do come from ANY engineers across the company. It's the same at most companies.
I have to say that I am happy to see a major company saying what everyone is thinking. It is truly absurd that Apple has the audacity to claim some 'we invented it' right to any type of Cellphone tech or Tablet hardware.
ALL Apples success is derived from the UI/UX side and the fact that iTunes laid the pavement for the 'app' concept.
Trying to bully the competition with purchased patents and lawyers will only turn people off their products, and once the 'Steve Jobs effect' wears off, they are nothing but another company selling cellphones and tablets.
And then, it might be time to look elsewhere for your 401k investment.
> I have to say that I am happy to see a major company saying what everyone is thinking.
Many of us are not thinking that. Many of us are thinking Apple didn't claim to have invented 3G radio, but purchased Qualcomm chips, and as the UK courts found, in licensing the technology to Qualcomm and its customers, Samsung had already "exhausted" its patent rights.
It's on the record that Samsung changed its tune on these patents in April 2011, looking for something to use to counter Apple's concerns about the wholesale appropriation of iPad trade dress (device, packaging presentation, box cover art) by Samsung's me-too tablet.
As Samsung's own quote notes, "Apple relied heavily on Samsung‘s technology to enter the telecommunications space, and it continues to use Samsung‘s technology to this day in its iPhone and iPad products. For example, Samsung supplies the flash memory, main memory, and application processor for the iPhone." Apple was happy to pay for those, just as they paid for radio chips.
Samsung now claims they want an astonishing percentage of Apple's revenue from phones for these patent rights that courts have found they'd already exhausted, even though Apple sells versions of the devices w/o 3G radios, indicating the majority of value of the device has nothing to do with Samsung's 3G even if the patent rights were not exhausted. Even aside from how much of the device value is thanks to Samsung's chip (Samsung says all of it, while even you say the UI/UX must be part of it), Samsung's percentage demand is not FRAND.
At least, this is what some people think.
> they are nothing but another company selling cellphones and tablets
Apple is not a hardware company. As someone recently put it on HN, "ALL Apples success is derived from the UI/UX side". And I'm also not sure that's true, considering the success of Macbook Air containing the same UI/UX as the rest of the Macbook line. The truth is they are a platform company, as noted in other threads here.
>Samsung now claims they want an astonishing percentage of Apple's revenue from phones for these patent rights that courts have found they'd already exhausted, even though Apple sells versions of the devices w/o 3G radios, indicating the majority of value of the device has nothing to do with Samsung's 3G even if the patent rights were not exhausted. Even aside from how much of the device value is thanks to Samsung's chip (Samsung says all of it, while even you say the UI/UX must be part of it), Samsung's percentage demand is not FRAND.
More importantly, how could Samsung claim Apple infringed on their patents when Apple purchased the chips from Qualcomm, who are licensed to produce and sell the chips?
This post is a rant of a fanboy which is why I downvoted it. It's one thing to prove your point but you didn't even do that. The BGR report is garbage as is most of their posts that doesn't involve Gellar's connections at RIM.
No one is claiming the idea of button-free phone; not even Apple. What you mention as the UI/UX experience is what Apple is mostly suing for. I don't claim for it to be right or wrong.
What defined the iPhone was not the hardware but software and that is what Apple is going after. Samsung is suing over FRAND patents which is something else entirely. Apple's not suing over Samsung over what they asked them to build.
This patent nonsense that exists on HN has really got to stop. It has affected very few except the claims by Lodsys. Do you really care about the brinksmanship that is conducted by two giants?
You're not mad that Apple is suing. You're mad that Apple is winning some arguments.
What they've been winning is off of UI/UX. It's one thing to argue if software patents should even exist but you were not even arguing that. It's hard to tell what you're against other than Apple. You believe that Samsung is right for no apparent reason.
All I can tell you is that I don't care and I'm tired of these stories on HN being ranked so highly since it's about ideology and not how it affects the lives of anyone.
>And btw, your name certainly looks interesting =)
Those are design patents which are more like a copyright of a physical item. For example, the design of a Coca-Cola bottle was originally protected under a design patent.
Yes it's a weird name. They're also easy to identify because the registrations all begin with the letter D.
I'm not defending Apple in this situation. I don't care about this patent nonsense. It has replaced chess as the game of kings.
If you looked at my comments recently I question the motives behind Apple bloggers I read. I've criticized Apple for the money they keep offshore to avoid US taxes. I've even been criticized for saying that open source was the solution for Maps and no one company should have control over that future.
What you want me to say is that I agree with one philosophy. I don't.
I'm angry about all of these stories making it to the HN front page whether it favors Apple or not. There are other stories that are more newsworthy. This has been going on for two years and has affected the lives of no one. It is only meant to push whatever cause you believe.
I thought my reply to whom I originally commented to stated this. I don't come to this site looking for stories that is only to incite a rooting interest. I come here for things that matter to everyone even though the bias is towards technology.
I love HN since you arrived. I stumble upon some comment dripping with uninformed ridiculousness about Apple and nine times out of ten whatever I was about to say in my reply has already been said by you but better.
Accusing someone as clueless doesn't make you look intelligent. If you don't give a valid reason, then your accusations are invalid. I have justified my point, (read above). You need to justify yours.
>Neya is the equivalent of Fox News.
I think you're crossing a line here. I know you're too insignificant to be given any importance, but then, do mind your tone. And stop following me, please!
And looking at some of your comments, you have a very good history of getting pwned I guess. Please stop embarrassing yourself =)
Campaign against the patent system. Don't expect public companies not to use the rules as they exist to their best interest. I don't even see anything unethical in wanting to keep some exclusive features (although 20 years seems too long).
I do also think that Samsung probably did cross the line between taking inspiration and wholesale copying and attempting to look like Apple.
Companies have short-term and long-term interests. There's plenty of sense in trying to convince a company that their pursuit of their short-term best interest is at odds with their long-run interests.
Separately, I'll note that "blame the game, not the player" rings particularly hollow when the players have plenty of influence on the people who write the rules.
Yes there are long and short term interests but maximization of current smartphone/tablet market share is likely to have a long term beneficial impact as people get locked into the eco-system. I don't see a persuasive argument that making life expensive for Android isn't a good play, and that there shouldn't be a wish to different either. They also need to draw a line (with some help from the courts about where imitation stops being flattery and becomes infringement.
Fair point on influence of the rules although I don't recall any of the tech giants opposing software patents or patent exclusivity. That certainly includes Google. If you can point me to a smartphone manufacturer that opposes software patents or design patents (registered designs in the UK) I would be very interested although I doubt I'll actually become their customer as I'm already locked into an eco-system!
"I do also think that Samsung probably did cross the line between taking inspiration and wholesale copying and attempting to look like Apple."
Most people point at the physical design of Samsung phones to make this point, but in all seriousness Samsung just plain didn't copy the iPhones design. Take a look at these two products Samsung made, both of which predate the iPhone and both of which show the exact design language that Samsung has used on the Galaxy * products:
Not somewhat similar to the design language, exactly the same. From the rounded corners, to the bezel, to the single button on the bottom of the device. This was Samsung's design language before the iPhone ever existed.
So you think Samsung ought to be able to sue you for patent infringement for buying a cell-phone?
Because fan-boy "rah rah fuck-Apple"isms aside, that's literally the legal outcome that Samsung is pushing for here. They licensed their patents to Qualcomm, who used them to build chips which were sold to Apple. Now, Samsung is arguing that the exhaustion doctrine should no longer exist and that Apple, by buying those chips, re-infringed on Samsung's patents (and, consequently that you re-infringe those patents when you buy a phone, or someone else's patents when you buy a TV, or a car, or a shoe, or anything).
What Samsung is arguing for here would make the already fucked up patent system thousands upon thousands of times worse.
What I found odd is that even though an iPhone or a Galaxy phone is using so much more important technologies in them, they get to banned for stuff like slide to unlock or pulling results from multiple databases. Even if you argue that it was an "innovative idea", in the end it's still just an idea, and the execution of it is not that hard to warrant a full ban of the whole product from the market for "copying their technology".
I agree that products shouldn't be banned based on small infringements, but it sounds like Apple doesn't want to license things like slide-to-unlock for any amount of money.
The question is what to do with a product that's already on store shelves that has been found to be unknowingly infringing one of these "unlicensable" patents. Is it fair to ban it (potentially imposing massive losses) or should the court award some "reasonable" amount of damages?
> Trying to bully the competition with purchased patents and lawyers will only turn people off their products
Actually, I doubt it will, as very few people care about the rivalry between large corporations. Apple even started suing mom & pop cafes that had the apple logo or just the word "Apple" in their name, and even that didn't hurt their image much.
Short term yes. Though I think we all remember Microsoft walking down the same path and basically paving the way for Apple to become 'the underdog' in the 90s and it sure hasn't helped their public image.
Right. Ultimately Microsoft's perceived opposition to the evolving open internet hurt it's perception among developers very badly. Where in the early 90's "everyone" wanted to work for MS and develop windows, by the end of the decade everyone wanted to be working with web apps and JS and Linux. Fast forward to today, and they're just another software company with no particular technical leadership ability.
Right now, the Apple bandwagon is still really full, so it may be hard to tell: but I'm seeing more smart hackers jumping off than on these days. In 10 years, how likely is it that Apple will be just another dinosaur milking a legacy OS?
The trademark arguably [arguably, not obviously] infringes on Apple's trademark, and one of the peculiarities of trademark law is that if you do not vigorously defend a trademark, it's scope and strength diminish.
Apple didn't even come close to laying the pavement for the "app" concept. I was installing apps on my palm m100 back junior high school. They were paid, there was an app store, it just wasn't connected to the device because the device didn't have a network stack.
In order the most patents were awarded to IBM, Samsung, Canon, Panasonic, Toshiba and Microsoft. So Samsung is no. 2, while Apple is all the way down in 38th place.
If anything, I'm willing to bet that Samsung and the other Asian manufacturers are the overzealous ones trying to use patents to muscle their way into the higher end of the technology market.
More patents are now awarded to foreign countries than the USA. Mostly Japan, Korea, Germany and Taiwan.
If you think Apple is on the wrong end of the argument, well I guess you don't want a domestic technology market?
What's more, the South Korean government (owned by Samsung) has been blocking and putting up barriers to foreign phones for years, including delaying the introduction of the original iPhone to South Korea, to give Samsung and co. a chance to develop competitors.
But does someone have a patent or design patent that covers the Apple implementation of notification? If not it doesn't matter. If so Apple should have to work around it.
There is a separate question about what should or should not be granted and whether the law should be changed regarding patentability and duration. Now I think the law should be changed and less should be patentable but that isn't the law or the situation now.
Google has applied for such a patent. It has not (yet) been granted, but there's no particular reason to expect it won't be, given the track record of the USPTO. Especially since many of the infringements Apple claims began in the period between application and grant, it will be interesting to see the shoe on the other foot.
It will be interesting. Agree about USPTO track record but I do wonder if there is more prior art in this area, I seem to remember Symbian having some form of notifications which may at least limit the scope of the Google patent.
I'm not familiar with the details of how patent protection is handled before grant. I would guess that licensing fees are not due for the period before grant but that as soon as it is issued you should work around it or pay licensing fees.
Assuming it is granted and no cross license is in place by then I assume Apple would try to work around it pretty quickly. I don't see Google offering it for a fair price as they are more interested in market share and leverage than cash too.
> Trying to bully the competition with purchased patents and lawyers will only turn people off their products,
I don't really care about lawsuits, I care about the product.
I will buy Apple if they offer the best product on the market. Lawsuits won't change that.
Apple owes everything to effectively cultivating the notion that they are cool and unique, the product of choice for young rebels and everyone who thinks different.
Cool enables their huge margins, grants instant forgiveness for any slip-ups and allows them to essentially dictate what constitutes the "best product".
That's why they're fighting so hard. Samsung is a threat to their cool.
I'm so bored of all this. It's like watching my parents going through their divorce - pretty much everything ended up with petty point scoring, and at the end of the day, the kids are the ones that got hurt.
edit: And their legal representatives made a rather nice chunk of change.
This case has nothing to do with patents and everything to do with Jobs/Apple throwing a tantrum. There are so many overly broad and trivial patents that companies have no choice but to ignore them. Standard procedure is to acquire your own stash of broad and trivial patents so that other companies won't bother getting involved in a legal battle with you.
This time though, Jobs thought Samsung and Google crossed the line in the scope and extent to which android devices copied the iPhone and iPad. So he started this patent war to spite them. I think everyone involved knows that nothing will come of this except legal fees.
Pyrrhic victories at best. So far none of the injuctions have had significant impact on revenue for Samsung or Google. Android is already ahead in units (though not app or media revenue, Apple maintains huge leads there) and gaining market share. And Apple is burning goodwill at a staggering clip: just look at the comment tone in these threads vs. the same ones a year ago -- people who used to defend Apple's behavior are getting quieter and quieter...
Which is my point. I have a truckload of -10's from a year ago to show you where I was expressing misgivings about Apple's behavior. The voting, like the posting, is part of the zeitgeist. And it's moving hard in the "anti-Apple" direction.
Look, from the 20,000 foot view, I think Apple's (ab)use of the patent system is pretty lame. But, this is just grandstanding on Samsung's part. If they have a legitimate legal complaint, I'm sure they'll bring it up in court. And then we'll see.
The US made the problem worse by the pro-patent policy from 1980's.
I also think the US companies have an unfair advantage in trials (eg. optical fiber Corning vs Sumitomo)
I am hoping Apple, the crown jewel, getting badly beat with patents will make US reconsider their pro-patent policy.
In February 2010, Google told Samsung that Samsung’s “P1” and “P3” tablets (Galaxy Tab and Galaxy Tab 10.1) were “too similar” to the iPad and demanded “distinguishable design vis-à-vis the iPad for the P3.”
In 2011, Samsung’s own Product Design Group noted that it is “regrettable” that the Galaxy S “looks similar” to older iPhone models.
As part of a formal, Samsung-sponsored evaluation, famous designers warned Samsung that the Galaxy S “looked like it copied the iPhone too much,” and that “innovation is needed.” The designers explained that the appearance of the Galaxy S “[c]losely resembles the iPhone shape so as to have no distinguishable elements,” and “[a]ll you have to do is cover up the Samsung logo and it’s difficult to find anything different from the iPhone.”
That may be a bit simplistic, but it does make you wonder to what extent Apple's currently chosen strategy was good business sense, and how much of it was the desire of a man facing his own mortality to desperately protect a legacy that would survive him.
To be honest I have no idea what kind of influence Jobs had at Apple in his final year so the above is just musing out loud.
I wonder if Apple is stepping into some really muddy territory with their legal brouhaha.
While Apple's patents center around their HW and SW design, from what I understand, Samsung, Motorola, et. al's patents include some fundamental WiFi and communication patents that could be a huge counterpunch towards Apple.
Nokia's argument was that a "reasonable" term for FRAND was a patent cross-license. Apple disagreed, and a lawsuit ensued.
Unfortunately, the judge agreed with Apple on that item. Everybody thinks that Nokia won their lawsuit since the judge awarded them a huge amount of damages. In my opinion, the whole industry lost. Cross-licenses were the standard way of dealing with the patent thicket before Apple decided to upset the cart.
The cross-license racket effectively locked out smaller competitors, so it was far from fair, but it does seem saner than the current blood bath.
Apple refused to cross-licence because it was suing with design and function patents, not FRAND patents (of which Apple's were already fairly licensed), so it wasn't under the same obligations.
It's the same logic underpinning their legal battles with Samsung and Motorola, where Apple is using design and function patents (some of them absurd) while the other two only have FRAND patents.
Mind you the whole thing is a mess, I've said before that I hope this all leads to some very necessary reform of the system. For one, the whole idea of FRAND patents has clearly come apart.
>Unfortunately, the judge agreed with Apple on that item. Everybody thinks that Nokia won their lawsuit since the judge awarded them a huge amount of damages. In my opinion, the whole industry lost. Cross-licenses were the standard way of dealing with the patent thicket before Apple decided to upset the cart.
This is how this is supposed to work, though. Apple and Nokia attempted to negotiate for a while, and could not come to an agreement. That's what prompted the lawsuit. The judgement was over two things:
1. Whether or not Apple violated Nokia's patents(which they were found guilty of).
2. Whether or not Nokia's terms to apple were in-line with FRAND(which they were found not).
Since the two could not come to an agreement, they had to use the courts to decide.
It cannot be FRAND to insist on cross licence as the impact discriminates against those with patents. The ND part.
It would imply that if I can get one essential patent into an important spec I can force you to licence hundreds of completely unrelated patents. That just can't be right.
I think it might get REALLY interesting when the 'old players' in the hardware scene (IBM etc) pull out their books and start counter suing for tech they developed when Apple were still flogging their Apple 2s
Remember, Apple as they sit today is a company with less then 10 years in the market.
Even if they have relevant patents they would be looking for money rather than legal costs and injunctions. I think it is likely that Apple would just pay some reasonable fees and move on.
They might even view the development as positive if it cost Android manufacturers as much per unit as they typically have less margin so may have to raise their prices making the Apple products relatively more attractive.
Why would companies like IBM suddenly start suing Apple and for what possible gain ? And Apple is nearly 40 years old with patents that extend across a wide variety of areas given that they design their own software and hardware.
I agree that IBM wouldn't see much profit in opening up the archives just to sue Apple. However, I suspect IBM has seen (and will continue to see) plenty of profit in opening up the archives in order to sell patents to companies more motivated to sue Apple.
Not to mention that it is a distraction to Apple employees. They are going to want to follow the case and (being human) have personal feelings involved. Already Apple needed to have released a new phone but haven't. People are tired of waiting and buying Samsung instead.
While watching this battle, I always wonder what sort of covenants exist on Samsung's supply agreements with Apple. I was wondering after reading the article why Samsung doesn't just stop selling them parts, or raise the price of the parts 100% or something like that. Seems like they should be able to 'earn back' all the money they are spending defending themselves and cause Apple double pain. But they don't.
And the other thing I wonder is if any of Apple's behavior is hurting them in the supply chain. If you make components that Apple uses and also make products in another part of the company for resale, do you put language in that Apple can't sue you? Or that you don't have to honor purchase orders if they do? Something?
> Apple, on the other hand, does have the freedom to switch suppliers.
Though it might be a hollow freedom if no one else other than Samsung can give them the volumes and delivery dates they need. Mutually abusive co-dependent relationship, oh boy.
Apple has enough cash on hand to literally pay upfront for TSMC or GlobalFoundries to expand enough to handle Apple's needs. (Apple tends to pay others to set up this kind of capacity rather than build their own because they don't like being stuck with the long-term upkeep on these uber-expensive facilities).
It wouldn't be cheap and it would hurt like hell while they got set up, but it would equally cripple Samsung as their own component costs exploded from all of the suddenly idle capacity in their own foundries.
It's enough of a nuclear war scenario that I can't imagine either side is eager to pursue it.
Foundries are incredibly (insanely) expensive to run, and Samsung Electronics runs more than anybody but Intel. Given the sheer volume of business that Apple does with them, it's likely that Samsung literally cannot afford to drive Apple to a rival foundry without either ruining their foundries' financials or massively driving up the component costs for their own products.
"Apple has admitted in internal documents that its strength is not in developing new technologies first, but in successfully commercializing them" - and that is why they WIN! Who cares whose technology came first. Samsung couldn't execute and Apple could. If we had it the Samsung way, Nokia 7200 flip phone would still be the standard of mobile technology. shivers
You should care who invents technology. If you make laws such as patent laws that work to suppress innovators (ironically), then you will be left with a stagnant monopoly. You can see iOS starting to stagnate even now.
In the long view, the innovators, thinkers, and dreamers of today will win. Companies like Apple will come and go as the markets collapse under the new monopolies. Forward thinkers will replace them. It's the same story over and over.
This is not news. The cell phone industry has a long history of petty non-novel patents, such as for vibrating _and_ ringing at the same time. A phone with a screen, a grid of icons and round corners sounds equally petty.
The idea of the patent system in itself is actually quite elegant. Government grants a temporary monopoly in exchange for the public disclosure of an invention. Everyone wins! The person issued the patent can more easily profit from their invention because they can work in the open. Society likewise benefits, no more secret guilds locking up knowledge, now everyone can see how it's done (and apply it once the monopoly expires).
As a social contract this really makes sense. The problem is that a lot of the patents being thrown around today only really satisfy half of that contract. A temporary monopoly is indeed granted, but the disclosure received in exchange is worthless information. I say it is worthless because no one actually needs to read that disclosure to figure out how to do it themselves with basically no effort.
Of the large companies, it seems to me that Apple is one of the worse offenders at exploiting the patent system in this way. Don't get me wrong, what they are doing is perfectly legal, but that doesn't make it OK. It does seem like Apple is following the legal rules and Samsung is thrashing around attempting to break them (perhaps feeling they have little alternative). But that doesn't mean that our legal system is perfect and cases like this will hopefully help us understand how it can be fixed to prevent this kind of exploitation in the future.