Why Apple Sues

Why Apple Sues

Apple’s critics generously assign a variety of motives to Apple for filing lawsuits.

Apple sues because it wants to control the market, overcharge for its products, exclude competitors from the market or punish competitors for daring to not think different. It’s all part of Apple’s “quest for global tech domination.

But these aren’t actual motives. These are appeals to emotion. They’re legitimate perspectives, but expressed to negatively encapsulate spectacularly complex technical, legal and ethical issues into sound bites that make you want to agree with the author that Apple is bad and wrong.

Apple has only one motive for patent lawsuits, and I’m going to tell you what that motive is.

What Is a Patent Lawsuit, Anyway?

A lawsuit is often viewed in isolation by the gadget-loving public as an act of aggression by one company against another.

Sometimes gadget fans feel like children whose parents are screaming at each other. It’s stressful, and everybody wishes they would just stop.

But that’s not how the companies see them. They see lawsuits as marriage counseling.

A civil courtroom is simply a place where differences of opinion can be settled by arbitration in a process that results in decision that’s binding theoretically on both parties.

More to the point, a lawsuit is just one part of a larger companywide program of innovation development and protection.

The company invests in research and development. Smart people think through hard problems. They come up with new ideas. The original ideas are articulated in the form of patent applications, which are filed with national authorities according to the laws in each country. And there’s no point to any of that if you don’t defend those patents via the legal system.

Hate the Game, Not the Player

I’ve found that most of the people who think they’re critics of Apple’s litigiousness are in fact more critical of the system.

They criticize Apple because they mistake Apple’s skill with needless aggression. And they mistake some other company’s incompetence with niceness.

Specifically, these critics believe that small things shouldn’t be patentable, only large things. And they believe that only functions should be patentable, not design or look-and-feel.

In reality small things — very small things — can be patented under current US law. And so can design.

Maybe these things shouldn’t be patentable. But they are. And if you don’t patent small things and design things and sue when those patents are violated, your competitors will. That’s how the system works.

Nobody likes the patent system. We all dream of the day when the US has a patent system that’s fair, rational and maximizes innovation.

But companies shipping products right now don’t have the luxury of dreaming. They live or die by the existing rules.

This is especially true for Apple. Apple makes one phone. If that phone were banned over patent infringement, the company would be mostly destroyed overnight. Contrast this with Samsung, which has a bazillion phones to fall back on and, in any event, also sells refrigerators, TVs, cameras and all the rest.

So getting the innovation development and protection process is existentially important to Apple. It’s vital that they get it right, and they do.

Why Companies Sue

There are, in fact, many motives that drive technology companies to sue over patents.

Some failing companies desperately need cash. As they take inventory of their assets, they find that the intellectual property patented during glory days can now be converted into badly needed capital. Kodak and Yahoo, for example, probably sue with this motive.

Others seek revenge. They sue after being sued as a reaction (cough)Samsung!(cough). It’s basically a strategy from boxing. The second your opponent connects, you instantly punish him with a counter punch. It puts him at a psychological disadvantage.

Still other companies want to straight-forwardly monetize their R&D. People are using their ideas, and they want to get a monthly check for it. Microsoft is big on this motive.

Speculation is another motive. Patent trolls roll the dice on investment in the purchasing of other people’s R&D, then they hunt for infringers in the hopes that settlement revenue will exceed purchase price.

Another form of speculation is when a very tiny company sees a very large company succeeding with an idea that some court might agree is a patent violation. Essentially, they want a piece of the action. Many of the lawsuits that Apple faces fall into this category. Companies are currently suing Apple over claims that Apple infringed patents used in Siri and Facetime, among others.

But none of these motives drives Apple.

Why Apple Sues

Apple’s nightmare is a world in which all phones and tablets look and feel the same, and everybody buys on price, or on processing power or whatever.

Apple sues in order to prevent competing products from looking, feeling or functioning the same way Apple products do.

In other words, Apple’s program for innovation development and protection is about fighting an industry slide into commoditization.

These lawsuits, which are mostly about past products, are fundamentally about future products. They’re prophylactic. What these court cases do above all is change the decision-making process for competitors.

A patent-law attorney uninvolved in the Apple-Samsung case named Robert W. Dickerson Jr. told The New York Times that “Companies in the future are going to have to consider how much they want their product to look and feel like their competitors’ products in terms of shape, size, the way it feels, the way it looks, how the icons are similar, or will the icons be quite dissimilar.”

On one end of the commodity spectrum, you have full-fledged commodities, such as crude oil or, say, high-fructose corn syrup. These commodities are sold based exclusively on price. The barrels don’t have fancy labels in branding.

At the other end of the spectrum, you have products that are the opposite of commodities, where brand preference and brand loyalty enables the manufacturer to charge more for a product perceived as having qualities available exclusively from the one company. Examples include the McDonald’s Big Mac or the Toyota Prius.

In just about every single industry of consumer goods, there is a battle between commoditization and de-commoditization. There are the Nike type companies, who want to say their shoes and brand are unique, and you should pay a premium. And there are dozens of other companies who’s message is: Just as good as Nike but cheaper!

A few years ago, LEGO sued a Chinese company called Tianjin COKO Toy Co. because its Coko Bricks product looked too much like LEGO. They were incompatible — you couldn’t plug a Coko into a LEGO. And Tianjin innovated — they came up with slightly different colors and unique Minifig-like characters. But LEGO sued and Tianjin had to shut down the operation.

Coko wanted to commoditize the colorful plastic toy brick industry so it could win on price. LEGO wanted to de-commoditize the industry, so it could compete on brand and product differentiation.

This happens in almost every industry, and it happens in the mobile handset market.

Apple routinely comes out on top in global branding studies, which are based on perceptions of brand value. Apple achieves this in part by successfully fighting the forces of commoditization.

The interesting thing to note about Samsung is that Samsung plays both sides of the field. It’s one of those do-everything companies (like Google, for example) that champions both commoditization and decommoditization. And that’s one reason why Samsung is such a successful company.

Yes, Samsung does innovate. And they also copy. And they make brand-focused products. And they make generic, commodity products. They do it all.

But Apple is a specialist. They make radically de-commoditized products exclusively. And part of their strategy is to fight the forces of commoditization.

And that’s why they sue.

(Picture credit)

  • gnomehole

    Wow, well said… though I doubt many Fandroids will… you can’t excuse Apple in a world of the hater, even with reason. But great job with this article.

    One day device owners will do a little research and open their minds and realize there is more too it than their simple perspectives allow to comprehend.

    Thanks!

  • metapgmr

    thank you Mike for bringing back some sanity and a great perspective in a debate where fallacy is the norm.

  • sosiouxme

    Defending innovation is not the purpose of the patent system. Its purpose is to give an incentive for inventors to reveal how their non-obvious inventions work. If others can easily copy your inventions just by observing them, then by definition they are obvious and non-patentable. The USPTO has run far afield from its original mission. Design is the province of copyright and trademark, not patents. If Apple is relying on patent lawsuits to keep their product relevant, they deserve to die.

  • Kiril Reznik

    Besides the fact that this is a biased article, its very well written.

    It should be noted though that Apple’s products is nothing more than a commodity with a badge.
    Although Apple design is unique is some ways, it’s hardly as ground breaking as they portray it. Its like trying to patent a Refrigerator’s design just because its white, rectangular and has two doors.
    Everybody has a mobile phone, in one shape or the other, just like a Refrigerator.

    Why Apple Sued?
    Because their customers were starting to realize you don’t have to pay premium in order to get a well functioning, user-friendly product and their main competitor was Samsung.
    In other words, Apple realized that their badge is starting to loose value.

  • Koban4max

    great article

  • Anushree Desai

    well what can you expect from an Apple Fanboy site!!

  • rrrosenfeld

    Non obvious means finding the cure for Cancer or Aids. There is no such thing in the technology market, be it in software or hardware. Technological patents just suck and actually prevent both progress and competition. That is so sad… :(

  • Rob Hyrkiel

    Then it must be the patent system that is flawed. Apple stole ideas from other companies too. Microsoft uses windows in it’s operating system and so does iOS. Technically that’s stealing because Apple should ‘innovate’ something different to avoid being the same. They should have used a triangle or perhaps a circle instead of a window, but instead they copied Microsoft. Was Apple the first company to integrate email into their phones? No, RIM did that years before but once again Apple ‘stole’ their idea. So at what point does ‘stealing’ other’s ideas become okay? When does it become infringing?

    Art has always been created based on other people’s ideas. Walt Disney for example based many of his stories and characters off of older ones. Same goes for technology, and same goes for Apple. But somehow Apple is able to sue other companies for having rectangular shaped phones with a touchscreen technology that Apple themselves did not even invent. So Apple’s talk of ‘innovation’ seems very hypocritical in the end and an excuse for controlling the market and providing consumers with fewer choices so that they Apple can ‘rule’ the tech world.

  • 567423

    I read your article, and I am having a bit of a hangup that doesn’t settle well with me. You mentioned the LEGO competitor-to-be Coko, saying that “Coko wanted to commoditize the colorful plastic toy brick industry so it could win on price. LEGO wanted to de-commoditize the industry, so it could compete on brand and product differentiation.” I TOTALLY hear you … in THIS case … but LEGOs and Coko blocks are, by design, essentially irreducible. They cannot be divided into sub-parts which themselves are branches of innovation opportunity or history. This is NOT the case with a mobile phone, or a car, or a sufficiently-complex piece of software. Mobile phones have different hardware, cars have different parts, and software has different ways of being written. Each of these products may have different (and therefore innovative) means of achieving the same macro-level functional objectives … Making a call, getting from the northside of the city to the southside, or using multiple graphics processors in uniquely efficient ways.

    So, while I agree that LEGO may benefit from decommoditization, I don’t think that Apple is motivated by this objective alone. Certainly Apple is specialized, but their end products are packages of technologies that were developed at many OTHER companies by many OTHER minds (and yes, at Apple, too). We could defer to an “it-is-what-it-is” mentality, but the reality is that the type approach Apple is making is going to harm innovation, not help it. If companies can’t make a car because it looks like other cars, how could designers improve upon transmission designs or airbag deployment technologies? How could we sufficiently develop safety metrics for cars without the statistics made available from large datasets of macroscopically similar designs? The way to help innovation is NOT to keep brilliant minds from advancing the sub-parts of a larger design. So, while I appreciate the spirit of IP protections, the real reason I’m upset with Apple is that they’re being disingenuous to the very history that made the company what it is today. Sure, Apple is looking out for itself through decommoditization, but it’s doing so in a very hypocritical way.

    The reason we have juries is to sort this mess out. They need to remember that they’re the last line between abuse and well-meaning intent. This would be a good opportunity to help the patent law system be re-educated on this point.?

  • cobalt6T

    GUI as some people call windows – rectangle/square thingy used in Op Systems is first developed by Apple to make computing easier.. Microsoft had DOS before, then they made Windows. Apple sued them and lost.
    Apple made it first Rob.
    You can make your own refrigerator Kiril just don’t make it look like Apple’s fridge.
    Have you seen Sony’s Experia? that’s real designers thinking, not making a cheaper version of iPhone, or that blue Nokia phone, its different not a copy. They have their own icons, looks and feel. That’s good for the consumers. why cry when your favorite phone company gets caught copying.
    If you want a phone that looks like an iPhone, get the real thing or else give your company a new design they might need it.

  • Zobby

    @ rob hykriel

    you say “. Apple stole ideas from other companies too. Microsoft uses windows in it’s operating system and so does iOS. Technically that’s stealing because Apple should ‘innovate’ something different to avoid being the same.”

    ????
    do you know that Mac os with ‘Windows’ came out years before Windows PC?

    Before Mac, the PC os from Microsoft was MS-Dos, a command line interface with NO GRAPHIC INTERFACE: No mouse, no icons, no recyle bin etc etc All this was from Mac.

    Apple got the idea from xerox and bought the tech with stock and pushed it much much further. Microsoft which was writing M.S Word for Apple at the time and had access to Apple stole the Windows tech . Apple sued but because Gates and gang had early pre laucnh access to what apple was doing with Mac BUT most of the apple tech (unlike today with IOS) was NOT patented. Apple sued and finally settled for Msft promise to continue to produce MS office for mac and the 150 million so called ‘bailout’ money.

  • ENDEAVOUR

    The more I read about apples lawsuits, the more I am inclined to wash my hands of them. I shape my own destiny, I make my own decisions, no one person or company for that matter is above what I decide. Any one person or company who thinks differently with be delt with swiftly and decisively !!

  • Daibidh

    Microsoft uses windows in it’s operating system and so does iOS. Technically that’s stealing because Apple should ‘innovate’ something different to avoid being the same. They should have used a triangle or perhaps a circle instead of a window, but instead they copied Microsoft.

    Was Apple the first company to integrate email into their phones? No, RIM did that years before but once again Apple ‘stole’ their idea.

    But somehow Apple is able to sue other companies for having rectangular shaped phones with a touchscreen technology that Apple themselves did not even invent.

    Hmmm. Did you type this with a straight face or are you really deciding to comment on something you clearly know very little about? Google Search is awesome. I suggest you use it. Even Cult of Android has some informative articles on Apple’s trade dress and technical patent disputes. You should also check out Samsung’s counter claims. Very interesting.

    It’s also prudent to know that:

    1. Apple is not suing for the exclusive rights to rectangle touch enabled smartphones.

    2. RIM did not release the world’s first email enabled phone.

    3. Microsoft’s popular graphical user interface does not predate Apple’s.

    4. None of these companies claim inventor status for any of these innovations.

    My apologies for coming across like a smart mouth but the discussion has digressed into hearsay and rumor. I disagree plenty with both sides but it’s important to stick with facts otherwise what’s the point of even debating?

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  • aardman

    Nice article. I commend you too for using the word ‘commoditize’ rather than ‘commodify’. The latter sounds like someone is making an object look like a commode, i.e. a toilet. But instead of ‘decommoditized’, I believe the proper term is ‘differentiated’.

    One thing I would add to the topic is that the seeming outlandishness or overstated claims of Apple’s (as well as Samsung’s) patent suits is just a result of proper lawyering in an adversarial system of litigation. –Each side tries to assert as much as they think they can reasonably, even thinly, justify and the judge and jury determine which claims are valid. Both sides’ counsels know that some of their claims border on the preposterous but they have to assert it anyway if they are to do their jobs right. There is no punishment for going overboard on your claims, at worst it just gets denied. You don’t get fined, you don’t get expelled from the bar, and you don’t go to jail. And hey, if you get more than you expected: Gravy!!!

    Note that even though Apple won, their iPad claims weren’t upheld. I think this time the jury system worked as planned.

  • seaaalex

    “Hate the Game, Not the Player”

    Whenever I hear this I know some BS is sure to follow ….

  • jbelkin

    What mike is saying is that we are free to re-purpose his columns with our names as long as we change 3 words – and we are free to re-publish them as tech analysis in book form for $19.99 as he clearly did not invent the words he uses or the air he breathes to write them so they are free for anyone to claim as their own. He feels nothing created/re-created has any intrinsict value (certainly true in his world) so share and share alike. What’s your ATM code again, Mike?

  • Claude Hénault

    Nice piece Mike, good summary of why Apple must remain unique in people’s minds. Being drawn into a perception of ordinariness is the kiss of death, pulling Apple into a race-to-the-bottom price-war that would kill the company’s value with sameness. So Apple sues to prevent competitors from making products about which it would be feasible to say: it’s just like an iPhone or iPad, just cheaper. So Apple goes out and defends the little things that, in aggregate, combine to make up the big difference.

    Don’t know why I am restating this, because the article said it very well. Thanks.

  • James Katt

    Apple’s victory will mean MORE PHONE OPTIONS for consumers.

    Samsung’s copycat actions are the same as if Chevy copied Ferrari’s 458 Spider – making the same looking car, down to the colors, shape, seats, steering wheel, dashboard, radio, tire tread pattern, etc. All of Chevy’s models become variations of Ferrari’s 458 Spider in appearance. But by Ferrari winning a lawsuit against Chevy, Chevy is forced to create different looking cars – such as the Corvette, Camaro, Volt, Malibu, Cruz, Sonic and Spark. This causes consumers to have more options.

    Because of Apple’s win, there will be MORE PHONE OPTIONS. After all, Samsung still wants to make billions of dollars in the smartphone market. After all, Samsung still wants to sell more smartphones than Apple.

    Samsung will just have to make different looking smartphones. It actually has to be more creative – like MICROSOFT, Sony, and the car companies.

  • venger9

    I agree with another poster who said that if people want their smartphone to look and feel like an iphone so much, then GET AN IPHONE!!!! DUH!!! Stop being jealous of the iphone and just get one.

    And the Apple win will increase innovation, not impede it. Companies will have to come up with their own solutions to design and hardware issues, which will INCREASE variety in the marketplace, not decrease. Sure initially there will be a decrease because companies will be scrambling to rework their products and it will take time, but a true capitalist market rewards ingenuity with success. Samsung was copping out by saying that the solution to every design problem was to BE MORE LIKE THE IPHONE!!. Now come one, give me a break. That’s it? I could have come up with that, geniuses. If I can get a high paying job at Samsung by coming up with the same solution to every problem and look like a genius, then sign me up! Samsung should actually use their hoards of cash and brains and come up with REAL solutions. Who knows, maybe they can CREATE better solutions that even Apple didn’t think of now that they are forced to actually come up with their own designs. Now that’s a novel idea. To actually innovate! Samsung, you claim to be a force of innovation. Now prove it to us. Do your own thing and make the masses happy.

    Which leads me to another point. There’s a difference between self-innovation and spreading other people’s innovation(legally or illegally). Samsung is a self-proclaimed proponent (or martyr?) of “innovation,” seeking emotional support from the public after their loss. But what kind of innovation are they promoting? They’re promoting APPLE’S INNOVATIONS!! They want to make it available to the masses without paying Apple any licensing fees and make a profit on top of that. And make no mistake, Samsung is not doing this for free or for the good of you or me. They are here to make money, plain and simple. But they disguise it behind a false pretense of goodwill for all mankind. They want their cake and eat it too by circumventing the patent system and making a profit. All the while, they pretend they are innovators in the process. So it irks me when people throw around the word “innovation” haphazardly because it’s the catch-all phrase for the moment and apparently it’s at the center of this epic battle between good and evil. At the heart of it, people just have to realize that “innovation” means the introduction of something NEW or a NEW idea, method, or device. Samsung doesn’t introduce anything new when they use Apple’s ideas. They are not self-innovators. They are in reality trying to spread another company’s ideas to the masses and profit from it. They could do it it honestly by admitting they are doing this, rather than claiming a title of self-innovators, and paying Apple for licensing fees, or, as they chose to do, do it deceptively and illegally. And let’s face it folks. Give credit where credit is due. The iphone did revolutionize the industry. Do you even remember the phones that came before it? Nuff said.

  • sadirbabe

    Then why doesn’t Apple allow for customization and diversity nearly as much as, say, Android does?

  • tjsbbi

    The patent system is very broken and is habitually used for purposes that it was never intended. All big players use patents as a commercial weapon. Apple is no different.

    Apple sues to hold back the day that it becomes a 10% player in the smartphone market.

    Like the PC market of 15 years ago, unless some major innovation comes along this sector will quickly become one of balancing price/features/performance. And there have been few major innovations of late: Just faster and higher performance hardware. If anything, recent software innovation has been lead by the Android camp.

    With some luck Apple will be able to hold a solid share while maintaining a premium margin. It certainly can’t hope to dominate.

    Apple sues because it’s good business to do so. It’s a corporation; Try not to become too emotionally vested.

  • appleguyjoe

    Apple sues because people like Samsung rip off their innovations. To read more about Apple vs. Samsung case visit http://thechurchofapple.com/2012/08/25/and-the-winner-is-the-winner-of-the-apple-vs-samsung-case/

  • technochick

    Then why doesn’t Apple allow for customization and diversity nearly as much as, say, Android does?

    Because they don’t want to and legally they are allowed to make that call.

    As for the issue at hand, Apple hasn’t done anything different than every other company out there. We just hear about Pple more because they get page hits and hits are how blogs like this make money

  • tucotuti

    great article!

About the author

Mike ElganMike Elgan writes about technology and culture for a wide variety of publications. Follow Mike on Google+, Facebook and Twitter.

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