Only
future can tell which side took the cup, but a casual analysis will tell you
that notwithstanding $ 1bn lawsuit loss, currently Samsung is winning the war
with Apple. At least Samsung is nowhere on losing front, Apple is.
Just to
put you in the context, the current verdict is
only for the one of a series of lawsuits ongoing between Apple and Samsung, not
to mention that these both companies are in similar fight with other companies
like Nokia, Motorola etc. on similar issues. It all started out in spring of
2011 with Apple litigating against Samsung. The two companies are still fighting
in many other lawsuits with billions of dollars claimed in damages. Similar
lawsuits are still pending in many other countries across globe between Apple
and Samsung. This has been one of the biggest patent lawsuits in history, and
jury ruled that Apple will receive more than $1 billion in damages from
Samsung.
Maybe it
is involvement of the company with the highest market capitalization in the
world or a clash of two giants, the lawsuit and proceedings have garnered a
vast amount of media attention. It is not that there haven’t been similar
lawsuits earlier but this particular case was given a high profile publicity
which makes you think that somewhere both companies might have been involved in
this quip to garner publicity and marketing the easy way.
I would
like to mention that I had been employed with Samsung in the past so my
analysis might be biased; it’s my personal opinion as I see it, discretion
solely depends upon you. I see Samsung’s case justified in the whole scenario
and do see Apple thwarting competition as was claimed by Samsung lawyers. I
won’t say that Samsung didn’t copy from Apple. Nobody can claim that Samsung
didn’t copy from Apple products and that’s true vice versa also. It’s a known
fact that telecom industry has long been involved into plagiarism. But
precisely that’s what has been the root cause for the exponential evolution of
cellphones and technology and also the driver behind a competitive industry
which has immensely benefited consumers. There are gags doing rounds on this
one also Link
The most
important scenario that has emerged in this whole mess is the clear divergence
between media and legal. While the jury has taken sides with Apple, online
world, most of them techies, quite surprisingly, have taken sides with Samsung
though Apple has been the apple of their eye when it was Microsoft vs. Apple.
In the whole run down Apple has been lashed for curbing competition by most of
the opinion leaders while Champions of Apple products have been silent
throughout. I believe Apple would have justified itself if their lawsuit was
about technical patents but winning the lawsuit on silly design patents like
‘rectangles with rounded corner’, they just managed to be new devil in world’s
eyes.
Another
aspect of this lawsuit is the country-wide differences. While jury in US has
favored Apple, the court in South Korea(Samsung’s native) has ruled against
both favoring no one. Link
This has led to another opinion
emerging that the ruling was biased in favor of American company because it was
in American court. A quote from facebook status which has
been shared wildly goes like this:
>>When you kill off
the competition you can then continue gouging your customers.
>>It's the American
way.
>>An American jury,
in an American city, using an American judge.
>>Gee what a
surprise verdict.
Change of
media-perception towards Apple
It would
take only an ignorant to claim that Apple’s iPhone is superior in terms of
technology than Samsung’s. Apple has been innovation leader in design but
certainly not in technology. Not an excellent product but riding on the wave of
publicity created by Steve Jobs, Apple has reaped enormous profits from its
smartphone business. With just 16.1 percent share in the smartphone market
Apple managed to rake in some 71 percent of the profit from smartphones
entirely because Apple is taking in 49 to 58 percent of margins in this
business compared to Samsung’s 22 to 25 percent. Link That’s a gross injustice to consumer. What is
noticeable is that this fact is coming out very visibly in opinions now, which
was being ignored previously by everyone.
Free
Marketing
There
are two ways to fight competition. One is to recognize the new wave and
adapting to it and other one is to ignore the new wave and create one’s own
future wave. Nokia, Motorola and Blackberry preferred latter strategy and
failed in it. Samsung preferred the first strategy and it has paid off very
well. The profits that Samsung has made in this endeavor far exceeds the $1bn
lawsuit put on it. As if profits from copycat products were not enough, with
this verdict Apple has ensured Samsung even more sales and a larger market
share. Not Samsung but Apple itself has claimed that Samsung products are
similar to Apple’s and along with less price and Samsung’s claims(which are true)
of better technology, means Apple has fallen in its own trap. Now whenever, a
customer goes to buy Apple phone he will at least compare it with Samsung
product even with a marginal conversion rate to Samsung products, Samsung will
gain a large share of Apple’s pie.
Brand Equity
There have
been benefits for both of the companies in some form whether monetary or free
marketing. But one thing where they both lose is their respective Brand Equity.
Apple’s image has taken a hit due to its attempts at thwarting competition and
ripping off consumer with inappropriate margin while Samsung is now legally a
copycat brand. Though earlier itself it was a known fact that Samsung has
always been an imitator rather than innovator, now this fact has got a wide and
publicized validation.
At the
same time Samsung also has been successful in garnering sympathy from online
world which constitutes bloggers and techies on top of that.
As I see
it, Apple’s brand equity has eroded more than that of Samsung’s but Samsung
also is on losing front in this aspect.
Short Term Loss for Consumer
Not even
considering the silliness of Apple’s patents, the market and consumers are bound
to lose if the patent system is not refined immediately. In the existing
market, companies won’t be able to make designs which are so considered
essential to smartphones now days. Without ‘pinch-to-zoom’ and ‘bounce effect’,
the whole feel of smartphone gets ruined until a new design comes along from
some other company. Such patents limit capabilities of manufacturers to a great
extent in coming out with innovative products. Not only it hinders existing
marketplace, the small and new enterprise will also take a hit as, in case of
such a patent system, almost everything can be broadly patented by existing
players thus leaving no room for new players to compete. Imagine Blackberry
having patent on QWERTY cellphones!
Long Term
Innovation
Having
said that this ruling may impact negatively to consumers and innovation in
short term the long term consequences could be positive with this ruling. Whatever
be the future of this patent war be, the manufacturers (not only Samsung) will
be cautious of making copy-cat products in future. This will mean, to stay
competitive, they will need to come out with better designs and better
technologies in future. In the long run, this will result in an overhaul of
innovation in every company rather than following a copycat product strategy.
Apple might have been successful in proving that its products are better
designed than competition, but it also managed to pursue competition to
innovate to make even better products than Apple. Samsung is already proving
this by experimenting with other platforms while Nokia is still in race. Link
Having
worked with the Korean giant for three long years I can at least claim that
they have no non-sense attitude and culturally Koreans are not really famous
for their sense of humor. But when war drums have been sounded, there is no
stopping from Samsung lovers. A meme which turned to a rumor and eventually
into a wild hoax has set the pathway for new Corporate Trolling. The hoax goes
like this - Samsung just trolled Apple by sending 30 Trucks Full of 5 Cents
Coins as a $ 1bn payment.
Whether or not in future we will see evolution in innovation from
both the companies, one thing is sure there is no dearth of innovation in
humor. Coming to the title of story, to protect itself, Microsoft may have
chosen to operate in segment which is different from Apple in OS war but
Samsung is still giving a beating to Apple in its own game.
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