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Is the Apple vs. Samsung patent litigation case bad for innovation?

Patent experts and industry observers would usually say that the current patent situation in the U.S. may be stifling to innovation. With patent lawsuits flying across borders, corporations and brands, do current patent laws encourage innovation, or has the fear of litigation caused companies to design "ugly hacks" just to avoid lawsuits?
August 13, 2012
“Someday, this idea will be worth millions!” (Everett Collection / Shutterstock)

If you’re an avid follower of technology news today, you would be familiar with how Apple and Samsung are battling out their differences in court. Basically, Apple says Samsung stole their design ideas by copying the iPhone and iPad. Meanwhile, Samsung says Apple is using their 3G-related technology patents without permission.

But what does this mean for innovation? Patent experts and industry observers would usually say that the current patent situation in the U.S. may be stifling to innovation. Patent holdings firms would often buy intellectual property in hordes, just waiting for an actual application of these technologies. Then, they earn by charging licensing fees. Either that, or they sue companies that unwittingly use the patented ideas in some form.

These are usually called “patent trolls,” although, of course, companies with a collection of intellectual property would usually beg to differ.

But what if the so-called troll is, itself, manufacturing devices based on their patents? And what if these designs have made their way into the consumer marketplace, resulting in a vast improvement of consumer devices that are otherwise clunky and non-user-friendly?

What about innovation?

Take the smartphone. Before the iPhone gave mass market appeal to the touchscreen, various smartphone platforms were using QWERTY keyboards, resistive touchscreens and clunky desktop-like interfaces. When the iPhone popularized the straightforward, finger-based touch interface, other manufacturers followed suit.

The result is generally good, with millions and millions now enjoying more intuitive touch-based devices in various platforms like iOS, Android and even Windows Phone.

The concept of patents was developed to foster innovation. Inventors are basically given a period during which they have exclusive access to their technologies, or that they could earn from royalties from other entities wanting to make practical applications out of ideas. As patent owners, Apple does have the right to its technologies. Competitors can choose to use this as an opportunity to innovate.

For instance, when Apple laid claim to the slide-to-unlock feature on touchscreen phones, Android customizations worked around it through different unlock methods, like patterns, ring unlocks, swiping motions, and the like. But as Memeburn claims, patent workarounds may also result in ugly hacks if the motivation behind innovating is simply to avoid a lawsuit: “less intuitive software and unattractive hardware designs.” If Apple claims that every beautifully-designed rectangle is their intellectual property, then every other smartphone and tablet out there would be unaesthetically-designed rectangles.

Apple’s legal moves are effective

Some observers like to think about the Apple vs. Samsung lawsuit as not just about design and wireless patents. Rather, the discussion has now escalated to what the issue is all about in the first place: Apple vs. Android.

Second quarter 2012 smartphone sales figures show that Samsung has fast overtaken Apple, at 32.6% vs. 16.9% market share. Moreover, Samsung’s year-on-year growth is at 172.8%. Meanwhile, Apple’s growth is at 27.5%. Android likewise dominates the mobile OS market, at 68.1% vs. Apple’s 16.9%.

ReadWriteWeb says that “68” seems to be the magic number causing Apple to worry right now. Their legal moves have been effective, so far. With temporary injunctions against several devices, like the Samsung Galaxy Tab 10.1, Galaxy Nexus, and even the HTC One X causing damage to these companies, revenue-wise.

Who wins? Will consumers bear the brunt?

Whichever party wins the patent game, it will be the consumers who will take the brunt. If Samsung is able to prove Apple unlawfully used its 3G patents, Apple would eventually have to pay licensing fees, and the iPhone might end up being more expensive (unless Apple decides to absorb the added expense within their hefty profit margins). If Apple were to win, Samsung’s products would be pulled off the shelves until it finds a way to work around Apple’s designs, thereby reducing consumer choice.

Thomas Jefferson was appointed to be the first head of the U.S. Patent Office in 1790, and said patents had “given a spring to invention beyond my conception.” Prior to that, though, he was against patents, as he worried “abuse of frivolous patents is likely to cause more inconvenience than is countervail by those really useful.”

With patent lawsuits flying across borders, corporations and brands, which side of the patent argument has dominated: frivolously abusive or springily inventive?