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Samsung vows legal retaliation against its $5.7B customer, Apple

post #1 of 93
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Following a patent suit from Apple, Samsung has vowed to retaliate with its own legal action, and the South Korean electronics giant is said to be considering a counter-suit related to wireless patents.

Samsung officials have reportedly said that they believe Apple has violated patents their company owns related to wireless technology, according to Agence France-Presse. Samsung has vowed to "actively" respond to Apple's lawsuit, and said it plans to take measures to "protect" its intellectual property.

"Apple is one of our key buyers of semiconductors and display panels. However, we have no choice but to respond strongly at this time," an unidentified Samsung official reportedly said.

The report noted that Apple was Samsung's second-largest client in 2010, following Sony. Apple reportedly accounted for 4 percent of Samsung's $142 billion in revenue last year, or $5.68 billion.

Apple was previously projected to become the largest customer of Samsung in 2011, with a reported $7.8 billion in component purchases planned. However, it's unknown whether Apple plans to shift components to another supplier given the recent legal action.



Apple took that action with a new lawsuit revealed on Monday, in which the Cupertino, Calif., company has accused Samsung of copying the look and feel of its products, specifically the iPhone and iPad. Named in the suit are the Galaxy S, Nexus S and Epic 4G smartphones, as well as the Galaxy Tab touchscreen tablet.

"Rather than innovate and develop its own technology and a unique Samsung style for its smart phone products and computer tablets, Samsung chose to copy Apple's technology, user interface and innovative style in these infringing products," Apple said in its complaint.
post #2 of 93
Guess I'd hate to be the CEO that loses a 7.8 billion dollar customer over the design of a smartphone that they had to know going in would ruffle some of Apple's feathers. And to react with a counter lawsuit tells me that Samsung thinks that they are the only game in town for the components Apple needs. However, I'd have to guess that Apple has some kind of contingency plan to replace Samsung if needed, prior to coming out with this lawsuit.

Might have some ex-Samsung execs walking the street in a few months.
post #3 of 93
Either this is some sort of "legal dance" between Apple and Samsung or a foolish quest on Apple's part... All of these devices have the same look and feel, IMO.
post #4 of 93
Quote:
Originally Posted by Dave K. View Post

All of these devices have the same look and feel, IMO.

And that's exactly Apple's point. There was a large variety of different devices before the iPhone came out and no one unifying theme. Then Apple introduced the iPhone and suddenly dozens of near clones appear.

Too bad none of the major phone manufacturers was able to innovate on their own.
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post #5 of 93
Quote:
Originally Posted by jragosta View Post

And that's exactly Apple's point. There was a large variety of different devices before the iPhone came out and no one unifying theme. Then Apple introduced the iPhone and suddenly dozens of near clones appear.

Too bad none of the major phone manufacturers was able to innovate on their own.

Exactly.
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post #6 of 93
A risky lawsuit.

Even if Apple wins, they may see a net loss, because they more or less rely on Samsung to meet the market demand on their products.
post #7 of 93
Well whatever the dance

In 5 years the tech landscape is going to be radically altered.

In a way out scenario the outcome could be harshest on patents themselves. I mean, if none of these get upheld in the vice versa lawsuits then what of patents and infringements.

The true battle to me is no longer patent ownership but sheer rate of innovation and ultimately pure invention. Cause that will attract buyers, dominate markets and provide you with the cash to keep on rolling. Sloppy seconds are simply that, copy all you want.
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post #8 of 93
At first, I wasn't totally sold on the case, but after seeing those pictures and looking at the Galaxy Tab, there is indeed something there. For instance, the Samsung Galaxy Tab comes with a "30-pin dock connector" very, VERY simliar to Apple's. In fact, I had some coworkers try to use it with their Apple products. In addition, the UI enhancements found in Samsung products is very iOS like. Obviously it's Android, but it's built to look and feel like an iPhone.

I have a Google Nexus S for testing Android apps and it's a great device. I have recommended to my friends. Why? Because it's a very good iPhone competitor. Same weight, same size, same screen dimensions, same feel. Yes it has a "curve", but otherwise it's an iPhone knock-off.

So I can see Apple's point in all of this. It's an immensely risky move for them given their current production issue, but like was said here, I doubt they would try this without a backup plan.
post #9 of 93
Quote:
Originally Posted by Dave K. View Post

Either this is some sort of "legal dance" between Apple and Samsung or a foolish quest on Apple's part... All of these devices have the same look and feel, IMO.

I usually think these patent suits are a bit ridiculous. However, after seeing the two side by side, I was shocked at how similar they appear. I think this is real

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post #10 of 93
So what radical form are manufacturers supposed to take to not look similar to each other?
post #11 of 93
Quote:
Originally Posted by jragosta View Post

And that's exactly Apple's point. There was a large variety of different devices before the iPhone came out and no one unifying theme. Then Apple introduced the iPhone and suddenly dozens of near clones appear.

Too bad none of the major phone manufacturers was able to innovate on their own.

The whole affair is bizarre. Apple's lawsuit is also pretty unwinnable. The case they want to make is that 'people should be more courageous, farsighted and original'. Yeah, I guess they should be, but they're not. That's why no one was making 'tablets' before Apple, and now everyone has a tablet or 'plans' for one. It's why houses on the same block look alike. It's why everyone (except maybe the top, top boss) in a corporation dresses alike.
post #12 of 93
Quote:
Originally Posted by cy_starkman View Post

The true battle to me is no longer patent ownership but sheer rate of innovation and ultimately pure invention. Cause that will attract buyers, dominate markets and provide you with the cash to keep on rolling. Sloppy seconds are simply that, copy all you want.

i'll go one further and say that the rate of copy (i.e., non-apple products) will dominate the markets. because, as we all know, apple is the only company out there that is truly innovating and pushing themselves.
post #13 of 93
This is standard operating procedure for Samsung. They do this to everyone, when Motorola Phones were hot they blatantly copied their designs as well.

Part or the reason Samsung sell their parts so cheap is to they can get into designs and learn how other companies do things so they can copy it and make knockoff at a lower price and win in the volume game.

Apple is learning the hard lesson that many other companies have learned, do not do business with a competitor. Honestly, no technologies company should buy Samsung parts, since many time Sansung makes the exact same product themselves. It the same as Apple buying technology from RIM, Motorola or Nokia, that that would do it teach those company the Apple know how.
post #14 of 93
To be fair to Samsung (& all the other phone manufacturers out there) there's not really anything they can do about having a similar look to the iPhone.

Seriously, how else can you make a touch screen phone? The display naturally sets the design, it's rectangular and usually 3.5". Apart from rounding the edges a bit more and maybe making it bright green what else can they do!

The OS is also very similar & Apple should sue google accordingly.

Apple might as well issue a law suit against every major phone manufacturer out there and just do it in one go.
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post #15 of 93
Quote:
Originally Posted by cmvsm View Post

Guess I'd hate to be the CEO that loses a 7.8 billion dollar customer over the design of a smartphone that they had to know going in would ruffle some of Apple's feathers. And to react with a counter lawsuit tells me that Samsung thinks that they are the only game in town for the components Apple needs. However, I'd have to guess that Apple has some kind of contingency plan to replace Samsung if needed, prior to coming out with this lawsuit.

Might have some ex-Samsung execs walking the street in a few months.

Samsung isn't like an American corporation. Its execs can get away with anything they please.

Walking the streets? No. Sitting around a pool? Yes.
post #16 of 93
Quote:
Originally Posted by Maestro64 View Post

This is standard operating procedure for Samsung. They do this to everyone, when Motorola Phones were hot they blatantly copied their designs as well.

Part or the reason Samsung sell their parts so cheap is to they can get into designs and learn how other companies do things so they can copy it and make knockoff at a lower price and win in the volume game.

Apple is learning the hard lesson that many other companies have learned, do not do business with a competitor. Honestly, no technologies company should buy Samsung parts, since many time Sansung makes the exact same product themselves. It the same as Apple buying technology from RIM, Motorola or Nokia, that that would do it teach those company the Apple know how.

They are component suppliers. They don't see the designs.

With 222,000 employees, Samsung is essentially a bunch of companies under the same name. Apple is essentially working with one department and suing a different department for patent infringement.

I have always thought that Samsung has independently come up with a style that is somewhat similar to Apple's. Although in this case it does feel like a complete ripoff of Apple's designs.
post #17 of 93
It's not surprising. All these smartphones out there rely on the 'it's kinda like an iPhone, but cheaper' argument.
post #18 of 93
Quote:
Originally Posted by RichL View Post

Samsung isn't like an American corporation. Its execs can get away with anything they please.

Walking the streets? No. Sitting around a pool? Yes.

Apparently you haven't heard of the fat cats running Goldman Sachs, Morgan Stanley, and the rest of the U.S. financial industry. None of them will spend even a day in jail despite all the double-dealing and self-dealing they did that exacerbated, if not outright caused, the great recession.
post #19 of 93
Quote:
Originally Posted by saarek View Post

To be fair to Samsung (& all the other phone manufacturers out there) there's not really anything they can do about having a similar look to the iPhone.

Not true. There are lots of iPhone competitors out there. Samsung's are the only ones that look confusingly similar.
post #20 of 93
They should hope Apple succeed, and force Samsung to just use stock Android. Then at least their phones will get updated.
post #21 of 93
I really hate to see Apple suing for the kind of thing, and potentially risky for both Apple and Samsung.

I really hope Samsung believes they can make $8 Billion in profit selling their own phones and tables because they could possibly lose that much from Apple. Really silly of them to play games like this.

I also feel that the copying by Samsung has been very blatant and pretty shameful. A lot of their "designs" would leave your typical Chinese knock-off company blushing.
post #22 of 93
Quote:
Originally Posted by ghostface147 View Post

So what radical form are manufacturers supposed to take to not look similar to each other?

How about WP7? Or WebOS?

Both have shown a very different UI is plausible (and I will admit that I much prefer WebOS, minus the lack of ecosystem, and the poor HW, but dislike WP7 coz its too swipey).

However, Google, and Android, chose to simply copy iOS.

Whether Apple wins the case is a big question mark, because I don't think there have been many successful lawsuits in the "look and feel" space. However, its ridiculous to deny the complete ripoff Android was (and the iOS ripoff happened only after they had ripped off Blackberry's OS).
post #23 of 93
Quote:
Originally Posted by ghostface147 View Post

So what radical form are manufacturers supposed to take to not look similar to each other?

It doesn't have to be radical but they should try to innovate. Samsung should be asking itself what it can make to differentiate themselves in the market. They seem to have gone to some effort to emulate the the iPhone in some of their designs in my opinion. When I look at those pictures I think the designers at samsung got paid to design something that looked like the very popular iPhone(both hardware and software), not for coming up with their own ideas.
post #24 of 93
Quote:
Originally Posted by esummers View Post

They are component suppliers. They don't see the designs.

With 222,000 employees, Samsung is essentially a bunch of companies under the same name. Apple is essentially working with one department and suing a different department for patent infringement.

I have always thought that Samsung has independently come up with a style that is somewhat similar to Apple's. Although in this case it does feel like a complete ripoff of Apple's designs.


That is not always true, I have direct experience with Samsung as component supplier and they will refuse to provide you necessary information to use their parts unless you share with them information about your product. If you willing not to use their low cost solution then you do not have to do business with them. But they use all kinds of means to get information about what you are doing even if they are not being designed into the product.

I can tell you Samsung is not capable of having unique ideas which was not already thought of by someone else. I will say one thing they are very good at recognizing which ideas are the best and copying them.

In the case of Apple, you are correct that Apple probably never shared the design with them since Apple does not tell any supplier which products or program their parts are even being considered for. Many times Apple has Foxconn buying the generic parts for them so supplier have no idea if the purchase is made for Apple or not.

Keep in mind apple does build prototypes for all their internal testing and development and many times they use the same companies to prototype parts as sumsung uses so I have no doubt that Samsung saw prototypes long before they were ever revealed to the public
post #25 of 93
Quote:
Originally Posted by ghostface147 View Post

So what radical form are manufacturers supposed to take to not look similar to each other?

Oh please. Just take a look at Windows Phone 7. As much as I dislike MS, I give them credit when it is due. WP7's UI is completely different from iOS. The Galaxy UI is a blatant iOS rip off.

As for the hardware, almost all smartphones have been copying the iPhone to one degree or another. The Galaxy is one of the worst offenders on that score as well. Take a look at the Palm Pre for an example of a design that tries to be a little different.
post #26 of 93
How does 4% of sales make Apple the second largest Samsung customer after Sony? Does Sony have 5% or 10% or 90%? and if so then how many other customers does Samsung have? would have to be an awful lot of customers if Sony is say, 20% and Apple is 4% and no other single customer is close to 4% - 75 other customers each around 1% ?
post #27 of 93
Quote:
Originally Posted by Stupidhero View Post

A risky lawsuit.

Even if Apple wins, they may see a net loss, because they more or less rely on Samsung to meet the market demand on their products.

And Samsung needs Apple so that they can manufacture tablet and mobile phone components at a scale that significantly lower their cost, thus benefiting not only Apple but Samsung's own tablets and mobile phones.

You and I know there are no one way streets in any commercial transaction.
post #28 of 93
Quote:
Originally Posted by ghostface147 View Post

So what radical form are manufacturers supposed to take to not look similar to each other?

I don't know dummy. Maybe ask Apple's designers. They can tell you.
post #29 of 93
The more I think about this this could be an attempt on Apple part to get Samsung to decide which of their business are more important to them. Of the $142B that Sam Samsung makes most of that comes form heavy industry like construction and ship building. Because of the way they report their numbers it hard to know if their electronics businesses actually turn a true profit.

Apple could be forcing Samsung to make a choice, either to be a component supplier to Apple or be a Electronic supplier competing with Apple. In the case of Apple having other sources that not going to be hard. For memory they got other choices who would love to have larger share, same goes for displays, and their are rumors that apples is moving the SOC production to another company anyway.

As someone already pointed out does Samsung think they can make $8B in electronic sales to make up the lost in component sales they risk if Apple changes suppliers. In little over a year Apple can completely design out Samsung if they wanted to.
post #30 of 93
Quote:
Originally Posted by lilgto64 View Post

How does 4% of sales make Apple the second largest Samsung customer after Sony? Does Sony have 5% or 10% or 90%? and if so then how many other customers does Samsung have? would have to be an awful lot of customers if Sony is say, 20% and Apple is 4% and no other single customer is close to 4% - 75 other customers each around 1% ?

Yes Samsung has 100's of customers all fighting for a few fraction of a %, The fact that Apple and Sony have about 5% is important to Sansung.
post #31 of 93
Nobody is talking about the counter suit of wireless patents against Apple?

They could potentially halt all sales of iPhone and iPad in the US.

Why aren't people talking about this?

There could potentially be a halt of sales of BOTH Galaxy devices AND iPhone/iPad devices.

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post #32 of 93
Quote:
Originally Posted by lilgto64 View Post

How does 4% of sales make Apple the second largest Samsung customer after Sony? Does Sony have 5% or 10% or 90%? and if so then how many other customers does Samsung have? would have to be an awful lot of customers if Sony is say, 20% and Apple is 4% and no other single customer is close to 4% - 75 other customers each around 1% ?

Um, have you noticed all those TVs and refrigerators and phones with the Samsung logo on them? They sell those to millions of customers. Apple is one of their largest component customers, but their retail sales account for a large percentage of the $142 billion.
post #33 of 93
Quote:
Originally Posted by Maestro64 View Post

Of the $142B that Sam Samsung makes most of that comes form heavy industry like construction and ship building.

Samsung doesn't MAKE $142B, that was revenue (i.e. make = profit).

In 2009, they had a Net Income of $13.8B (not quite the same as profit, but a closer indicator I believe).
post #34 of 93
Quote:
Originally Posted by Galbi View Post

Nobody is talking about the counter suit of wireless patents against Apple?

They could potentially halt all sales of iPhone and iPad in the US.

Why aren't people talking about this?

There could potentially be a halt of sales of BOTH Galaxy devices AND iPhone/iPad devices.

I guess we'll see what happens with that one. Live by the sword, die by the sword.

Apple gets ripped off all the time, but if they've "taken some liberties", then they need to be held accountable just like anyone else.

And yes, I was pretty disappointed in Apple over Confabulator and Watson. It's not cool to eat your young.
post #35 of 93
Quote:
Originally Posted by saarek View Post

To be fair to Samsung (& all the other phone manufacturers out there) there's not really anything they can do about having a similar look to the iPhone.

Seriously, how else can you make a touch screen phone? The display naturally sets the design, it's rectangular and usually 3.5". Apart from rounding the edges a bit more and maybe making it bright green what else can they do!

The OS is also very similar & Apple should sue google accordingly.

Apple might as well issue a law suit against every major phone manufacturer out there and just do it in one go.

Apple already complained of HTC

Google don't make money from android neither they do products for customers with it. Google is not concerned by patent here.
post #36 of 93
Quote:
Originally Posted by Maestro64 View Post

The more I think about this this could be an attempt on Apple part to get Samsung to decide which of their business are more important to them. Of the $142B that Sam Samsung makes most of that comes form heavy industry like construction and ship building.

Really, cos I see that in 2009 out of $172B revenue, $117B of that is "Samsung Electronics". Where did you get your figures from?
post #37 of 93
Quote:
Originally Posted by Maestro64 View Post

Of the $142B that Sam Samsung makes most of that comes form heavy industry like construction and ship building.

Who is this Sam Samsung guy?
post #38 of 93
Quote:
Originally Posted by jragosta View Post

And that's exactly Apple's point. There was a large variety of different devices before the iPhone came out and no one unifying theme. Then Apple introduced the iPhone and suddenly dozens of near clones appear.

Too bad none of the major phone manufacturers was able to innovate on their own.

Exactly!

A while back I was at a restaurant where I admittedly peeked at a guy using his phone at the next table. I thought it was an iPhone at the time, but the grid on the screen seemed a little off. After seeing these pictures, it could very well have been this phone that I mistook for an iPhone!

The comment above gets it exactly right. The look and feel of the physical design and the menu systems of smart phones was all over the map. Heck, I remember throwing away my wife's Samsung phone because, after a year, we still couldn't get photos off the darn thing onto the computer (no way to update the "OS" to fix the menu bug). The single biggest unifying event in the industry was Apple releasing iPhone. Then all the big players got their copy machines fired up and came out with the clones...and tech geeks like me are now mistaking these cheap knock-offs for the real mccoy.

I actually have to give Microsoft credit here. They made a very reasonable effort to not copy everything about the iPhone in Windows Phone 7. The UI design is significantly different enough that, for the first time ever, I don't feel like they just ripped off Apple. What, couldn't Samsung hire an art director with a little originality?

When tens of billions of dollars in profits are on the line, big companies will stop at nothing. So they blatantly copy. It's sad: They have no scruples about doing it, they're defensive when they get caught, and then they fire back offensively with their own lawsuits when someone seeks damages from their theft. I think they need to take it a little less personally: "Yeah, we made a bad judgement call and came out with a product that looks too similar to yours. Our bad. Let's come to an agreement on damages, and we'll try to do better in the future."

I'm sure Apple isn't immune to this either, but it seems to me Apple has a lot more character. I can't think of any cases where they blatantly ripped off a successful product...seems to me they're more likely to license it or buy it. I'm sure there are exceptions, but they don't come to mind.

Granted, I don't know any details surrounding these lawsuits and I have no connection to either company. As a developer and content creator, I just hate to see it when someone steals someone else's work.
post #39 of 93
Quote:
Originally Posted by saarek View Post

To be fair to Samsung (& all the other phone manufacturers out there) there's not really anything they can do about having a similar look to the iPhone.

Seriously, how else can you make a touch screen phone? The display naturally sets the design, it's rectangular and usually 3.5". Apart from rounding the edges a bit more and maybe making it bright green what else can they do!

The OS is also very similar & Apple should sue google accordingly.

Apple might as well issue a law suit against every major phone manufacturer out there and just do it in one go.

Many, many, years ago I had an IBM Simon phone with a touch screen (and a stylus). Trust me, the user interface was completely different from Apple's. Just because it has a touch screen doesn't mean it has to look *anything at all* like an iPhone.

Granted, the Simon wouldn't compete in today's market, but it's proof that you *can* come up with something completely different and still use a touchscreen. For that matter, Win 7 phones do a pretty good job of looking different from an iPhone (versus the Samsung units, anyway).
post #40 of 93
I think I would have just said "stop making those galaxy things look like our stuff or we stop buying from you." And then make good on the threat. The whole lawsuit thing is so lame and risky.
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