Sources: Apple asked Samsung to pay $30-$40 per device to settle patent dispute

July 25, 2013
547
Sources “directly involved with the matter” told Korean media that Apple requested substantial royalties from Samsung to settle their patent dispute.

apple-vs-samsung

The patent war between Apple and Samsung has entered a calmer phase, as the two largest smartphone makers in the world are reportedly trying to settle their lengthy patent dispute.

According to the Korea Times, the negotiations have stalled recently, as both parties look forward to obtaining more bargaining chips following decisions of courts and regulators.

Samsung, the world’s largest phone maker, is said to push for a comprehensive cross-licensing deal with Apple, that would resolve all the current disputes. Obviously, the Cupertino-based company demands favorable conditions for the deal, which the Koreans can’t stomach.

Samsung thinks that Apple's royalty demand “doesn’t make any sense”

Samsung is reportedly dissatisfied with the high royalties that Apple is demanding, which, according to sources cited by the Korean publication, amount to $30 for each phone and $40 for each tablet sold by Samsung. Some quick arithmetic tells us that at $30 per unit, the Korean conglomerate would have to pay Apple more than $600 million for the Galaxy S4 units it’s sold so far, plus other significant amounts for other devices. It’s not surprising therefore to learn that Samsung thinks the demand “doesn’t make any sense”, say the sources.

Why does Apple ask so much money from Samsung? As the most profitable tech company in the world, Apple doesn’t need money, but it does need to slow down Samsung’s relentless growth. Tim Cook’s company wants an agreement that would bring it strategic benefits, hence the almost punitive royalties it asks from its Korean rival.

Apple wants an anti-cloning provision to prevent Samsung from copying its products.

Korea Times goes on to quote Florian Mueller of Foss Patents, who thinks Apple also wants an “anti-cloning” agreement, similar to the provision in the cross-licensing agreement it signed with HTC. In other words, Apple would be willing to license its patents, but it wants to prevent Samsung from “cloning” its products in the future.

Both Apple and Samsung await upcoming decisions of the ITC and courts from around the world, hoping for a little extra leverage. Samsung obtained a ban on some older iPhone and iPad models, which President Obama is expected to approve come August. Apple is looking forward to another victory in courts in California, after it won more than $1 billion last August, an award that was later halved by the judge presiding over the case.

The game played by the two giants of the smartphone world is even more complex when you factor in that Samsung is one of Apple’s key suppliers of electronic components. Apple has tried to break away from Samsung over the past couple of years, but, according to the latest rumors, the Korean conglomerate will still manufacture the crucial application processors inside iPhones and iPads for the following years.

Comments

Load More