Why Apple Is ‘Losing’ the Samsung Lawsuit So Far

By

ipadkickstand

Apple is a riddle, wrapped in a mystery, inside an enigma. No, wait. That was Stalinist Russia.

Whatever. The two are nearly identical in their abilities to keep secrets.

As an Apple observer myself, I’m keenly aware of the iron curtain of secrecy that prevents anyone from knowing what Apple is working on, what they’re planning and what their processes are for developing new technologies.

Rumors and speculation are always so easy to come by; unannounced facts are rare — even facts about the past.

That’s one of the great things about Walter Isaacson’s biography of Steve Jobs. It gave rare insight into the inner workings of Apple, to some degree.

And that’s what’s so great about the current jury trial in Silicon Valley, where Apple is suing Samsung and Samsung is suing Apple. It’s forcing Apple to reveal countless facts and events that it doesn’t want to reveal.

The lawsuit appears to be far from over. But already, it’s clear that Samsung is “winning.” Why? Because it’s a contest between a company that cares deeply about its secrets — even small ones — and a company that doesn’t care as much. So the discovery and revelation is punishing Apple.

Here are the 8 secrets Apple has been forced to reveal in court in the past couple of weeks. 

1. Steve Jobs changed his mind about a 7-inch iPad

Steve Jobs famously dissed the 7-inch form-factor in an October 2010 Apple earnings conference call by saying: “This size isn’t sufficient to create great tablet apps in our opinion.” He also said that because tablet users tend also to have smartphones, “giving up precious display area to fit a tablet in their pockets is clearly the wrong trade-off.” 7-inch tablets are “too big to compete with a smartphone and too small to compete with an iPad.”

But three months later, we learned in the trial, it appears that Jobs changed his mind.

Apple Vice President Eddy Cue said in a January 2011 email revealed in court that (after playing with a Samsung tablet) he strongly advocated to Jobs that Apple should sell a 7-inch iPad, and he championed the idea to Jobs several times starting in late November of 2010. Jobs became “receptive” to the idea “the last time,” according to the email.

2. Apple spent more than a billion dollars marketing iPhone and iPad

Apple’s Senior VP of Marketing Phil Schiller was forced to specify in court that Apple spent $647 million on marketing for the iPhone before the end of fiscal 2011, and $457.2 million to market the iPad. That’s more than $1.1 billion in iMarketing money.

3. Apple closely watches the competition

Part of the Apple mythology, which is encouraged by Apple itself, is that Apple doesn’t pay attention to the competition.

Samsung produced an internal Apple email written by Apple industrial designer Christopher Stringer, in which he wrote: “Paul, I need your latest summary of our enemies for an ID brainstorm on Friday… If you have any more data beyond this please could you update the chart? I wonder if there’s anything worth noting about the HP/Palm leak.”

4. Apple listens to its customers

Another part of the Apple mythology is that Apple doesn’t get product cues from customers and users. Apple says they design products for themselves because the users don’t really know what they want.

However, the trial has revealed the existence of extensive surveying of customers by Apple. Samsung wants the data made public.

Survey questions reportedly aim to find out why Apple customers choose iPhone instead of competing phones, for example, and specifically how much they like or dislike specific features of the iPhone.

Apple strongly opposes the revelation of the survey data. The judge sided with Samsung but granted Apple time to appeal.

5. Most people buy iPhone cases

Internal Apple documents forced out of Apple in the trial show that 78 percent of iPhone owners buy cases for their iPhones.

6. Apple thought about adding a “kickstand” to the iPad

Apple created several iPad prototypes that in hindsight look somewhat wacky and loony. One had a huge “kickstand” in the back, so the tablet could be propped up like a framed photo.

7. The code-name for the iPhone was “Purple” 

The initiative to develop a phone was known internally at Apple starting in 2004 as the “Purple Project,” and the area where this development took place was called the “Purple Dorm,” which smelled like pizza, according to Apple VP Scott Forstall. Bonus detail: The “Purple Dorm” had a “Fight Club” sign to emphasize secrecy, as in: The first rule of fight club is that you do not talk about fight club.

8. Apple made a phone instead of a camera or a car

Schiller also revealed that the iPhone came about because Apple was interested in expanding into other markets. The company actually entertained the ideas of making “a camera or a car,” according to Schiller.

Why Secrecy Matters to Apple

A big part of Apple’s aura is the perception of effortless genius. A dozen brilliant designers sit around a kitchen table and dream up the future.

But the Samsung trial has forced Apple to reveal a different reality. Apple works really hard to get its success. Apple spends a fortune to market its products. Apple people speak internally in the language of violence: It’s competitors are “enemies” that must be defeated in a design “fight club.” It pays close attention to the competitive products and customer satisfaction. Apple doesn’t always know what it’s doing.

And it’s not just aura. Apple people probably believe that it’s their view of the world — how they think about problems and solutions — that sets them apart. And revelations about how they thought about past products enables competitors to more easily get inside their heads and perhaps think the same way about future products.

Whether you agree with Apple’s obsession with secrecy or not, that obsession exists. Keeping these secrets is important to Apple. Which is why the lawsuit has thus far cost Apple far more than Samsung.

Deals of the Day

  • howie_isaacks

    Nothing really surprising here. This seems more like a criticism of Apple for being secretive. They have to be. Companies like Samsung and Microsoft use Apple as a research and design dept.

  • DENNIS0910

    I am sorry to say this, but your narrow minded comments surprises me as you mentioned out are a apple observer. Apple’s success is because one simple rules they have been following, to create the best product they know how to build for the customers, everything else, no matter marketing or secrecy obsession u mentioned in your article, are just fragments that apple does in order to achiever their ultimate target. That, my friend, enabled apple to be an outstanding firmed, and also why other company keeps copying its product and technologies.

  • Daniel O Reilly

    Was reading this thinking it is factually sound but as the author starts to move from fact towards his own opinion it started to unsettle me to the point that I thought, this must be that Elgan fella again. I scroll up and surprise surprise….Mike Elgan! What is it with your style of writing that u try to swing small fact into ludicrous Poorly conceived conclusions?

    Let me use the ‘fight club’ example, your reference is completely devoid of context, they used the name fight club purely because of ‘first rule of fight club, no one talks about fight club’, but instead you use it use it to justify your ‘language of violence’ fairy tale!

    Also, you refer to ‘Apple listening to their customers’! Of course they listen to their customers, they are a multi-billion dollar global conglomerate who forge a tight bond with many of their customers. Steve Jobs famously spoke about market research being irrelevant because sometimes you have to show customers what they want, he refers to Henry Fords quote ‘if I’d asked people what they want, they’d have said a faster horse’. Again you completely disregard the context, in this case they are talking about the invention of groundbreaking new inventions and products. Obviously in the court case they are talking about the feedback from the customers who are now using these ‘inventions’ as a means of evolving the product to keep it relevant and competitive.

    This is what annoys me about Elgans journalism, his opinions completely overshoot the facts he writes about. Sensationalist, attention grabbing headliners encapsulating feeble fables !

  • gnomehole

    I’m with Howie_isaacks on this… no real huge secrets here, I doubt any impact to Apple. I don’t think they will ultimately “win” this lawsuit, unfortunately for all of us, but I’m glad they are trying. If we think innovation is stifled by lawsuits, wait until the courts give the “a-ok” to copy. All consumers will lose because, assuming Apple continues to innovate, everything will start to look like their product.

    Wait.. it already does. I take that back.

  • dporter15

    I thought Apple was clearly winning this lawsuit?

  • Jason Bartlett

    Trial
    TrIal
    TRIAL TRIAL TRIAL!!!
    Stop saying “trail.”
    Learn to spell.

  • Bt2184

    hardly think any of this constitute Apple losing the suit.

  • cphilano

    Did you guys even read the article? Its not an attack on Apple, but a commentary on how this trial is detrimental to the aura and myth of how they approach innovation. This trial is revealing that Apple engages in a lot of the practices that they claim not to do, and if people are gravitating to their products because of are so much greater then why the huge payout on surveys and marketing?

  • May Seventh

    They did make a camera. Quick Take 200. I don’t think Jobs was with the company at the time.

  • easydone101

    Wait..Apple actually LISTENS to there customers?

  • nolavabo

    I honestly do not believe that this trial is about stopping Samsung and their blatant copying of Apple’s products. Samsung is a huge corporation too, and could fight this to a standstill. Rather the desired effect seems to be to stop every other company on earth from hitching on the “let’s copy Apple” bandwagon.

    What’s remarkable in all of this is that Moto/HTC/Huawei/LG etc have all been trying very hard to not come up with iPhone knockoffs. I doubt it is because they are ethically superior to Samsung; they are simply afraid that Apple will sue them too. If Apple is willing to sue a massive corporation, who sells the most Android handsets AND is also their most important component supplier, then they are clearly willing to sue anybody.

  • Tallest_Skil

    1. Steve Jobs was not CC’d on that Cue e-mail. It’s not proof of anything except a hinting that Cue might have been usurping him.

    2. So what?

    3. No frigging duh.

    4. No frigging duh.

    5. And another so what? That’s basically a given. I’ll never buy one, but I know my mother will want one.

    6. And how is this knowledge somehow a “loss”? All we know now is that Apple isn’t staffed with morons, which we knew before.

    7. We knew that already, though.

    8. Yes, and? That doesn’t mean they won’t make a car in the future (already made a camera; there’s no need for another standalone one). The iPhone was the only logical product to make at the time, since they’d already been working on a tablet.

  • aardman

    Sorry, those are more confirmations of what a reasonably intelligent observer would surmise about Apple rather than earthshaking revelations. And this talk about Apple not listening to customers is just a meme cooked up and perpetuted by tech pundits. All Steve said was that they don’t do focus groups for new products. Some sensationalist pundit expanded that into ‘Apple doesn’t ask their customers at all’ when in fact elsewhere Steve clarified that for existing products they rely very keenly on customer feedback. In truth Apple listens very closely to customer feedback. The reason they appear as if they don’t is that they take their time to investigate, study, and then remedy any issues raised by customers and in the meantime they are extremely quiet about the issue, not even wanting to ralk about it.

  • moiano66

    Seriously Mike, next time try to come up with some ‘real’ secrets.

    Maybe you can try revealing why Apple is so fond of ‘skeumorphic’ design lately.

    I’m sure you can come up with an explanation.

    smdh

  • NickParkerMusic

    Oh wow those are some pretty world top secrets you just mentioned i mean really??? Even pre-released products and prototypes are subject to leaks these days. Is apple any less of a secretive company after the mighty 8 secrets you just mentioned? The answer is NO.

    Apple loses more on the long run if Samsung continues their blunt copying of Apple products, it’s not a battle for past products, this is a battle for future products to prevent more blunt copying from happening. The penalty if apple wins this lawsuit won’t make apple any richer or Samsung any poorer, however the humiliation Samsung is being put to is priceless.

    1. Steve Jobs changed his mind about a 7-inch iPad.

    Any of the top blogs could’ve sneaked their way into extracting such info, it’s a no brainier.

    2. Apple spent more than a billion dollars marketing iPhone and iPad

    Shocker, with all the celebrities apple used to promote their products, peak time slots, how could any one not guess that they have spent that much money on advertising?

    3. Apple closely watches the competition

    Is there a company ran by sane heads that doesn’t?

    4. Apple listens to its customers

    The Fuck?

    5. Most people buy iPhone cases

    Again any blogger could’ve surveyed iphone cases vendors and extracted that info.

    6. Apple thought about adding a “kickstand” to the iPad

    Didn’t we already know pre-trail.. i mean TRIAL that also the ipad idea was born before the iphone? That’s far more “Secretive”.

    7. The code-name for the iPhone was “Purple”

    Huge secret, that’s gonna effect my next iphone purchase since i hate the color purple.

    8. Apple made a phone instead of a camera or a car

    Or an airplane, anti gravity shoes, or an irobot. get real man.

  • technochick

    What a pile of crap. Nothing said has a thing to do with the lawsuit.

    And we have no proof he changed his mind, just that he listened to the conversation

  • Jens Jensen

    I thought Apple was clearly winning this lawsuit?

    Nothing is clear until the judge sings. But he did not say they weren’t losing it. He has an education and so writes at another level that most of the readers here. Here is a hint there were ‘ around the word. That changes the meaning.

  • Jens Jensen

    hardly think any of this constitute Apple losing the suit.

    He didn’t say they were.

  • Jens Jensen

    Indeed.
    What Apple is losing are the hearts and minds of the tech journalists. They used to be almost hypnotized zealots following the mad pipers from Apple. Much of the sales where from them hyping the products to people who didn’t know much. But that is ending rapidly. When that ending Apple will be sliding back being just another company.
    And more ordinary non Apple users have started express hostility towards the company, suggesting boycotting them because of the constant lawsuits, preciously they would have ignored it.

  • Mirage299

    This is one great unique article. Thanks Mike!

  • TheFreakTweet

    The title is definitely link bait, which is fine I guess, but definitely misleadng since Apple does appear to be doing quite well at the trial so far. I too am a bit concerned that too much is being revealed about Apple’s in-house design process. I would imagine that Samsung, being a copycat, will pour over every detail and try to copy it. So yeah, I think there’s a bit of damage here for Apple. But again, the title is more link bait than something that properly represents the article content.

  • joewaylo

    Apple is losing as they have little proof they are right. They need a higher concrete proof. Witnesses to design sellers being a hard case to sue the seller. The proof of copying would help too. Only a few drive a 1/4 resemblance. Just the home button is close enough.

  • GreatBoo

    I haven’t found any of the revelations from the court case that surprising. I don’t think knowing that Apple judges competitors products that wild an idea either. In fact, none of the secrets you listed could really be called secrets, some are common sense, some seem to be you drawing conclusions based on a single phrase – specifically the ‘enemies’ quote and some are taken out of context – Fight Club, designing a car.

    What I do know is, that Apple came late to the phone market and redefined it – the phone became an application on a very sleek, intuitive, mobile computer. All their competitors where in a much better position than Apple where – being established. Then the iPhone comes along and a few years later dominant players like RIM and Nokia are, probably, months away from bankruptcy.

    The real secret is, how did Apple use the same tools available to every other company out there, such as R&D, market research (which is all listening to customers and watching competitors really is) and marketing to manage that?

  • Anthony Antman Siringo

    What the HELL does any of this have to do with the lawsuit?

  • Paramendra Kumar Bhagat

    The trial will likely stretch on. So more details to be revealed, I guess.

  • Brandon Carson

    This demonstrates why the NYTimes has nothing to worry about. Posts like this are “created” simply for the link action. There’s no substance here. And for the love of God… it’s TRIAL, not TRAIL four times. A simple edit would help set you apart from being just a spam post.

  • lwdesign1

    Mike, unfortunately you’ve pushed this article past the realms of basic logic and tried to create a mythos for Apple that doesn’t exist. Only a child or moronic adult would believe that Apple achieves its amazing products easily without great effort, without examining the competition and without closely examining its intended market audience. None of the 8 “secrets” above is news to even a moderately intelligent person.

    Of course they have lots of mockups and ideas for new products that get tried and discarded along the way. Why wouldn’t they? They’re doing basic and groundbreaking R&D so I’d naturally suspect they create huge piles of dopey stuff that never pans out, but that seems like a good idea until a physical mockup is created.

    You create a fantasy world where “everyone” believes that Apple’s engineers/witches/wizards waive their magical technology wands and create awesome things in a flash–and that somehow by revealing these 8 “secrets” Apple is somehow being revealed as un-magical. Sorry, I’ve never believed this. I know it takes hundreds of thousands of hours of hard work, late nights and testing to get the products just right.

    AND THIS IS THE WHOLE POINT OF THE TRIAL!

    For Samsung to simply come along and copy the bulk of the technology that Apple sweated over for years to develop is just not right. If great, groundbreaking ideas were easy to come up with in a few minutes, there would be no real objection to copying them would there?

    The fact that so much thought, effort, testing and so many discarded ideas were tried is PROOF that Apple worked hard to come up with its products, and that they’re not just trying to “copyright a rectangle” as detractors would say. These 8 “secrets” are not a loss for Apple in any way, and I’m surprised that you have tried to manufacture them into one.

  • mikelgan

    Hi, Daniel. It’s an opinion column, not a news story.

    I quoted the entire line from “fight club” to clearly specify that its purpose was about secrecy. Later, and incidentally, I added it as an example of the kind of language used at Apple.

    Regarding the market research, you’re forgetting that Apple is trying very, very hard to keep their market research secret. That’s my only point. Of course they listen to their customers! Of course they watch their competitors. These are things I’ve been saying for years, and which some of the more rabid fanboys have always attacked me about. Now this court case is revealing the obvious truth, and Apple isn’t happy about it.

  • Thomas Beck

    How come I am redirected to a porn website while reading this article?

  • jfmartin67

    The title of this article doesn’t match the content… Here is why.

    1. OK Steve Jobs changed his mind (proof of that please)… He was more receptive… did he change his mind?? OK, He as changing his mind… so what??? How does this affect the trial??? You fail to demonstrate that.

    2. How spending a pile of money on iPhone and iPad advertising is making Apple look bad in this trial? You fail again to prove your point.

    3. Of course Apple watch competition!!!! Does it mean they copy Samsung? You fail (again) to make a relation with the point you try to prove. Oh and by the way, it could also means Apple wants to make sure they don’t look too much like Samsung (!)…

    4. Apple mythology, on this you are right… they do get some input from actual users and buyers… but what is the link with the current trial? You fail again at this.

    5. You fail AGAIN. What is your point???

    6. You fail AGAIN and AGAIN. What is your point?

    7. In what way Apple is losing the “war” by having called the iPhone development project Purple? In what way? You fail.

    8. So what? They were working on tablets before working on phones.. and??? What is your point? You fail.

    Simply calling this article: “Interesting facts about Apple” would have changed everything. Now, you sound more like: how can we word this article title in order to drive more traffic to our site…

  • Michael Breed

    So let me get this straight… your epiphany about Apple as a result of this trial is that Steve Jobs changed his mind about a product, Apple listens to its customers, and they work hard on advertising and product development? WOW! Sounds like a recipe for success to me. Really, Mike, how badly did your editor need an article from you?

  • Tallest_Skil

    How come I am redirected to a porn website while reading this article?

    Because you don’t know how to use AdBlock and Ghostery.

  • theobserving

    1. so what?
    2. not surprising. billboards in every major US city, TV ads all over the place. the real story is that sites like this, and the various other rumor mills, have given them -several- billion dollars in advertising for free. so there’s that.
    3. if you bought what they were telling you, you need to rethink your life. of course they do.
    4. every purchase has an opportunity to fill out an NPS survey, about the experience. and feedback@apple.com exists. again, not surprising.
    5. and bears poop in the woods. this is not a “reveal.” stand in an apple store for 15minutes near the accessories, or, you know, walk around in public and observe people.
    6. you mean a company designed multiple versions of a product, and whittled down features? shocker! /s
    7. interesting, but it doesn’t reveal anything. did you know OS X 10.8 is code named “Mountain Lion”? yeah.
    8. so what?

    these “revealed secrets” aren’t anything new or shocking. anyone with a modicum of business experience or the ability to observe the world around them would be able to ascertain these “secrets” with little to no effort.

    weak, pointless article. inflammatory on an apple website to get clicks.

  • Chuck Nigash

    Completely disagree. You’re thinking too hard. None of the 8 points made are as significant to a court victory that serves a global notice to stop cloning. Similar is OK, copy is not. Diluting and confusing the market is clearly the greatest loss if Apple let Samsung (Google next) get away with it.

  • markrlangston

    Wow, Mr. O’Reilly tore you a new one but it’s hard not to agree with him.

    I also think that anyone that truly believes that Apple is some mystic company able to leap tall buildings in a single bound is voluntarily choosing to suspend their belief as it relates to Apple’s success.

    Maybe the perception is that they don’t do market research, don’t conduct or use focus group information, etc, etc but that’s not the reality and to believe it makes you a (pardon the pun) cult follower. This is why people refer to Apple lovers as iSheep because they’ll believe anything Apple says as gospel and never bother asking questions. They just buy it because it’s Apple and not for any other reason when we Apple lovers know that it’s because their products are the best. Not because we believe some whimsical fantasy that’s making MacBook Airs with a warehouse full of elves.

    You sir, are the epitome of an iSheep.

    I agree that Apple probably doesn’t want their secrets out but they had to know going in that in order to prove they have exclusivity to this technology they would have to reveal a lot about the company’s internal machinations. Personally, I don’t think anything they’ve revealed hurts them in the slightest.

    It’s like finding out that there’s no Santa. Sure he’s fake but that doesn’t mean we can’t still be excited to see him at the mall. My point is just like the movies we know Neo isn’t actually dodging bullets and that Wolverine doesn’t actually have claws coming out of his fists, but we can suspend our disbelief for the sake of fun because we know the reality is so much less interesting.

    Maybe we’re getting too much backstage information but that doesn’t mean Apple is losing. It just means we’ve seen the movie a dozen times but now we have the privilege of seeing how they made it look like Neo was dodging bullets.

  • bowlingGreen

    WTF is this article about