What the Apple-Samsung Case May Mean for Innovation & Competitiveness

In a case that has garnered much attention by the media, Apple claimed that Samsung had infringed on several patents on the iPhone and iPad.The San Jose jury unanimously agreed with Apple in its verdict. However, a similar case in South Korea found that Samsung infringed only one Apple patent while Apple infringed two Samsung patents.

More important than the $1 billion that Samsung must pay to Apple for its infringements (which is a mere 1.5 percent of Samsung’s annual revenue) is the message Apple conveyed to companies with regard to basic design elements in electronic devices.    The case of Apple versus Samsung is just the first of several claims by Apple of patent infringements by other companies.  Most threatening is the message sent to device makers who use Google’s Android operating system.  Apple has surprisingly chosen not to sue Google likely because it is much easier to make a case for monetary damage against companies like Samsung that sell hardware to consumers versus a company like Google, which doesn’t charge device makers for its software.

The impact this case will have on future competition is yet to be seen, as some lawyers argue that Apple isn’t the only company that can come up with innovative designs-and its court victory could encourage more innovation by competitors.  However, others argue that this verdict could stifle innovation as it may force device makers to slow or abandon product development in fear of breaching Apple’s intellectual property resulting in less smartphones and tablets on the market and higher production costs and prices for consumers.

Samsung stated, “It is unfortunate that patent law can be manipulated to give one company a monopoly over rectangles with rounded corners or technology that is being improved every day by Samsung and other companies.”

Perhaps this case, which is one of the largest patent damages verdict on record, will encourage others to, “think outside the box” (no pun intended) and develop more unique designs in the future.

 

Posted by: Elizabeth White

Sources: The NY Times, The Wall Street Journal & CIO Journal

Photo Credit: apple-samsung Courtesy of Flickr user diTii

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