Hey, Apple, How's That Patent Suit Strategy Working For Ya?
Apple (AAPL) has become aggressive on the patent suit front, so far suing Nokia (NOK), Samsung, HTC, and Motorola (MMI) over the last year, both in U.S. district courts and the U.S. International Trade Commission. So how's the strategy going? A few days ago, ITC staff suggested that neither Nokia nor HTC was infringing. And Samsung, one of Apple's biggest and most important vendors, filed serious counter suits.
IP legal actions are strategic weapons. Properly used, they slow competitors down, protect a company's innovation advantages and brand, and even create additional revenue streams from licensing. Used incorrectly, they become expressions of ego that offer no tangible advantage or value to a company. Apple shows signs that it has slipped out of the former category and into the latter.
Apple, the patent bully
It wouldn't be the first time that Apple has tried so squelch competition. Former Sun Microsystems (now part of Oracle) CEO Jonathan Schwartz has told a story of Steve Jobs trying to shut down one of the company's projects by threatening legal action when, in fact, Apple was in a far worse patent position. Net result: Jobs shut up and left Sun alone.
There's a long streak of Apple anger at competitors that management thought were copying the company's work. The biggest example was suing Microsoft over Windows, when John Sculley was CEO of Apple and the board of directors had pushed out Jobs.
Unfortunately for Apple, it had licensed aspects of the Mac user interface to Microsoft, just as, in a way, Apple had given stock options to Xerox for the chance to pick brains and such ideas as GUIs and mouse user input devices that led to the Mac. Apple lost a court case over look-and-feel copyright. The company that turned out to be Apple's big competitor ultimately beat Apple with what the latter felt were its own innovations. That's a long-standing chip on the shoulder.
A bad start for the Infinite Loop Legal Squad
Although the ITC staff recommendation isn't a final decision, this is a bad start for Apple. The suit against Samsung does make Samsung look as though it copied what Apple did, according to an analysis by Nilay Patel, but it still mostly involves minor issues. What will Apple do now that Samsung has sued Apple over patents on "power reduction during data transmission, 3G technology for reducing errors during data transmission, and wireless data communication technology" -- areas in which Apple doesn't have such a wealth of protected innovation?
Apple doesn't have the strongest hand in these matters, and it has antagonized a vendor that can either help Apple weaponize its supply chain or, potentially, starve it of the parts it needs to keep the iPhone and iPad profit machines running. Apple's legal activity could potentially cause more damage to its strategy than even the most slavish copying.
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