"What's of concern is that you can see the strategic relationship between Samsung and Apple getting worse of late," Kim Young Chan, an analyst at Shinhan Investment in Korea told Bloomberg. "As Samsung pushes ahead with its handset and tablet business, Apple is trying to keep Samsung in check."
Steve Dowling, a spokesman for Apple, commented: "It's no coincidence that Samsung's latest products look a lot like the iPhone and iPad, from the shape of the hardware to the user interface and even the packaging. This kind of blatant copying is wrong, and we need to protect Apple's intellectual property when companies steal our ideas.
"Samsung will respond actively to this legal action taken against us through appropriate legal measures to protect our intellectual property," was the official statement from the Korean firm, but the country's Yonhap news agency quoted executives saying that, in fact, it was Apple which violated Samsung IPR. One commented: "Apple is one of our key buyers of semiconductors and display panels. However, we have no choice but respond strongly this time."
In fact, Apple was Samsung's second largest customer in 2010, accounting for 4 per cent of its total revenue of $142bn. Apple may have been trying to reduce its dependence on the firm, for instance by reducing Samsung's design and manufacturing input to its A4/A5 processors, but it will not be able to avoid it, given the shortages of touchscreens and memory chips and the problems already seen in tablet parts.
Apple suffers reverse in ITC
The courts may take years to decide on the merits of the case, and how far a rectangular shape really can be patented, but the rising tide of lawsuits in smartphones shows the level of competition, and Apple's sense that its day in the sun is over. Filing suit over elements like shape and color smacks of desperation, as do some of the patents cited in Apple's separate battles with HTC, Motorola and Nokia. A key decision went against Apple in the US International Trade Commission this week, with a judge ruling for HTC and Nokia. The vendors are accusing the iPhone maker of "dredging up" ageing patents in its determination to stop rivals in their tracks.
A lawyer at the ITC has said that Nokia and HTC did not infringe Apple patents, a recommendation which is highly likely to be adopted by the full body when it reaches its final verdict in early August. Apple has been seeking to block imports of both Nokia and HTC smartphones to the US, as part of broader legal battles with the Finnish giant, and a wider attack on the Android community – also involving Motorola and now Samsung. This case is only one of several against Nokia. Last month, the ITC ruled against Apple in a separate complaint against Nokia.
The HTC ruling is particularly important because it is likely to have implications for the whole Android base. Apple claims the Taiwanese vendor infringes five patents that are vital for "seamless integration of hardware and software". Some, related to signal processing and interprocess communications, date from the early 1990s and "were, at best, a very narrow distinction" from the inventions of others, HTC lawyer Robert Van Nest told ITC judge. "HTC is a smartphone innovator and pioneer in the smartphone sphere. They were there long before Apple," he said. "The fundamental differences from the Apple patents represent choices made by HTC and Google."
Interesting but is it real analysis?
Yes, Apple are at or near the top of the curve. But this article is filled with wishful thinking rather than hard analysis. The below expected results this quarter for iPad sales are in no way a reflection dissappointing performance in the market. Nor do they reflect an over-estimation of the value or attractiveness of the post PC tablet Market. They reflect only supply chain logistical constraints and (at worst) planning failures and it is churlish to attempt to present the iPad as anything other than the runaway success it is. So using that to support the picture of Apple desperate and rounding the apex of the curve is wishfull thinking on the authors part rather than a reflection of a true weakness. Yes resorting to patents can be viewed as desperation, and certainly that has been the case for other companies in the past, but without independent indicators of desperation, that too reveals a picture the author would like to see rather than what he knows to be the case. It can also just be Apple leveraging money invested in filing IPR.
The other "indication Apple are struggling" the author uses is Apple's current "failure" to deliver a cloud music play. But this analysis lacks wisdom or insight, as there are compelling strategic partnership reasons why Apple would want to be second to the party. In summary, their form on strategic partnership indicates that while they push out technologies that unlock the market, they never rub their content partners faces in it. So they contractually ensured unlimited data (probably at the cost of a exclusivity deal with AT&T) because they saw the strategic value of ensuring the iPhone was used without data constraint. But they then didn't do Internet Tethering or allow Skype calls until after their competitors (even though they could have allowed both from the outset) because they saw the value of keeping their carrier partners (globally and not just in the US) on board. Similarly they have very strong reasons for being second to the Cloud Music Streaming party to avoid annoying their iTunes partners. Amazon is currently drawing very strong legal fire from the record labels, while Apple can now fairly say to their partners, we need to also move into music streaming to compete. Apple purchased a functioning music streaming service some time ago, so there is circumstantial evidence adding to the strategic form-book, supporting the position that the delay is a matter of policy.
The author indicates Apple are "desperate" on the basis their competitors are planning to launch new cloud based services now and implies Apple are failing to reply. Yet Apple (unlike their competitors) have consistently shown discipline in avoiding either revealing or "bigging-up" future product launches and the strategy works very well for them. It's highly unlikely, with their cash pile and history of delivery, that they have anything but a very rich and queued up pipeline of new launches.
Also the criticism of Apple as a "one trick peony" couldn't be further from the truth. Compare with their arch-rival Google and there you really do see - on the key criterion of revenue generation - a one trick peony. Everything, including their reported revenues for Android and YouTube (which are still proportionately very low) stems from their core advertising business. And no doubt much of the revenues that should really be attributed to search advertising are re-classified as YouTube and Android advertising success (e.g. when the ads in-situ in YouTube and Android are hit one step on from a Google search). I don't want this response to sound like a slanging match placing Apple over Google but it is important to reflect the mis-analysis inherent in the use of the "One trick peony" label. Google are making a strategic play, but they don't yet have real diversified revenue streams. Apple have multiple distinct product lines (iPhone, iPad, Mac, iPods and Mac Computers, Software) albeit united by a single ecosystem (which is a strength) and all contribute to earning real share of revenue (and notice I didn't need to resort to including iTunes or App Store).
I do agree with the author that Apple are at or near the top of the curve. However not for the reasons the author has given. I believe it for the simple reason it is difficult to see how they can continue to have an uninterrupted line of successful products that keep them as far ahead of the competition as they have been over the past three years. So my reasoning is based on respect and the slight cynicism we all as human beings have. I respect the success Apple have had. I wonder how it can continue, but equally I don't rule out further successes being launched this year or next (the Apple product secrecy point remember). I suspect the Author actually agrees with me too but rather than finding solid indicators Apple have reached the Apex of the curve, he/she has sought to write a post seeking tap in to our natural cynicism and play on the incredulity we most of us have, pretty much in equal measure. It makes for a good headline but doesn't make for insightful analysis. But then TheRegister majors in cynicism and there's always a place for that.
Apple's competitors wish they could be that "desperate" ;-)
The writer of this article is either ignorant of the facts (and reality in general) or he/she/it is just trolling for hits and will do anything ridiculous to accomplish that.
Starting with the article title "Apple's record sales are signs of desperation"... What!?!
Record sales increases (while all other competitors are losing sales) is a sign of desperation? If that's desperation, Apple and its investors must be hoping it can be more "desperate" in the future.
"And the iPad... is not yet proving that the category itself is a winner". You can't be serious. Is this meant as a joke? News flash: April Fool's Day was 3 weeks ago.
You base your premise on this nugget of ___ : "The iPad sold 4.69m tablets, fewer than the 6.1m predicted by analysts or the 7.3m of the holiday quarter."
Hello!?! The quarter reported on ended March 26, 2011. The iPad 2 which purchasers were holding onto their money for, only went on sale in the US on March 11th (the first shipment sold out nation-wide in 24 hours!), and it only went on sale in select other countries on March 25th (the day before the quarter ended).
Most intelligent people realized that the numbers would be low for this quarter even before the iPad 2 went on sale, but apparently you did not understand this.
The iPad 2 sold over a million units in its first day on sale (in the US only). By comparison, the original version of the iPad, crossed the one-million mark 28 days after its launch.
With the iPad 2 selling 28-times faster than the original iPad (which was the fastest selling consumer device of all time) this, to you, bizarrely is an indication that the iPad "is not yet proving that the category itself is a winner". ???
Next you write that Apple is displaying it's "vulnerability' by suing companies that steal its intellectual property. That is insane! Any company will rightly sue another company that steals rather than licenses its patented IP.
You try to support this ridiculous notion by using FUD to understate the situation, by saying Apple "allege copying of the colors and rectangular shape of the Apple products." Either you again do not have any understanding of why Apple is suing Samsung, or you are intentionally trying to mislead your readers.
You only need to look at the side-by-side comparison photos on the Web, to see that Samsung blatantly copied both the hardware design and the user interface design of the iPhone in the Samsung Galaxy phone.
Your article continues with other similar misleading information.
You might be hoping that your readers are buying all of this nonsense, but most people are more intelligent than that, and the result of your article is that you have lost any credibility as a writer.
I enjoyed this post more than the article.