Men are silhouetted against a video screen with Apple and Samsung logos as he poses with Samsung S3 and Samsung S4 smartphones in this photo illustration taken in the central Bosnian town of Zenica

Steve Jobs famously declared back in 2010 that Android was a stolen product, and he was willing to “go thermonuclear war” in order to “destroy” it.

“I will spend my last dying breath if I need to, and I will spend every penny of Apple’s $40 billion in the bank, to right this wrong,” Jobs said. “I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this.”

Back in April, I suggested three reasons it might be time for Apple to settle its Android disputes and move on. The relatively small damages award in the most recent case (and which now looks set to be further reduced) provided a fourth reason not long after I wrote that piece. But I think the case today is even more compelling … 

Simply put, the court battles are no longer particularly relevant: Samsung is losing in the marketplace.

Samsung recently reported a 31 percent drop in profits for its mobile division, a hit sufficiently embarrassing to the company that its senior managers handed back part of their bonuses and agreed to fly economy as a way of expressing their regret.

Nor is this decline a recent phenomenon. While the company as a whole has been doing well, that has mostly been due to the strong performance of its consumer electronics (televisions in particular), display and semiconductor divisions. The smartphone business has struggling for some time.

problem

The problem for Samsung

Samsung has always tried to be all things to all people in the smartphone market, from its flagship Galaxy S series to cheap-and-cheerful models sold mostly in developing markets like China and India.

Its high-end handset sales – the only area where it competes with Apple – have been declining. To address this, the company’s co-CEO told Reuters back in April that the company would be focusing more on cheaper models.

JK Shin, co-chief executive and head of Samsung’s mobile business, has called it a “back-to-basics” strategy that will help the world’s biggest technology company by revenue rein in component costs and make products of wider appeal.

Not that it can expect an easier ride at the low-end. Competition from Chinese brands has been aggressive. Xiaomi, Huawei and ZTE have all seen their share of the smartphone market increase over the past year.

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Court battles provided a PR victory

It’s not that I think Apple was wrong to pursue its court battles to date. While the financial impact on Samsung may have been limited, it did achieve a valuable PR objective: it helped establish Apple’s image as the market leader while successfully depicting Samsung as a copycat.

Apple may never have lowered itself to using terms like Samesung, but the court battles helped establish that perception out there in the marketplace – and generated graphics like the one above.

Samsung, by the way, used to make no secret of its copycat approach, with marketing strategy documents acknowledging its ‘fast follower’ heritage: a company that watches what the market leader does and then aims to be next to market with something similar. But that’s an image it’s been fighting hard to leave behind, and it’s the patent trials that have made that so difficult.

The question now is whether further court battles will achieve anything more. If the most recent award has established a precedent for the value of individual patents, further cases make no financial sense for Apple. And I’d argue that the PR battle has already been won.

Will it remain won forever? Maybe not. Memories may be short. But if that proves to be the case, there’s nothing to stop Apple heading back to the courts again as & when it needs to send a reminder to the market. But for the foreseeable future, I think the job has been done.

low-end

But what of the rest of the Android market?

Ok, you might say, but what about those up-and-coming Android brands? Companies like Xiaomi, Huawei, ZTE? Don’t they also represent a threat?

Maybe they will one day, and perhaps when that day comes it will make sense to take them on. But right now? Nope: they are not competition for Apple, they are competition for the established Android brands: Samsung, HTC, Motorola.

Sure, Apple’s market share has been falling now for some time, but that’s not because iPhone sales are falling – they’re not, they’re growing – but because market share is being diluted by low-end smartphones. Smartphones bought by people who would never be in the market for an iPhone.

Apple isn’t interested in the low-end of the smartphone market. Despite some initial rumors about the iPhone 5c before it appeared, Apple isn’t interested in the mid-market either. It’s interested only in the premium slice at the top of the market, and the new players aren’t yet having any impact there.

I make no apologies for repeating my use of this graph because it truly tells the story at a glance:

sp

There’s nothing to be gained by Apple taking any of those players to court because, to a premium brand, they’re irrelevant.

Apple has very slowly been softening its stance on its battles with Android. It agreed back in May to settle all patent litigation with Motorola. In July, it decided to drop a motion for injunctions against older Samsung models, despite them being still sold in some markets. And just a few days ago, Apple and Samsung agreed to end all patent disputes outside the USA.

We’re going to continue to see further court action in follow-up to the second Apple v Samsung patent trial, but I do wonder whether we might now manage to avoid a third.

As ever, let me know your views in the comments …

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23 Responses to “Opinion: Is the case for Apple ending its patent battles with Samsung stronger than ever?”

  1. Gregg Mojica says:

    Yes!!! and it’s crazy.

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  2. Yes. People need to stop using that Jobs quote. During that same time he also thought he was able to cleanse his body of cancer with a juice diet. Dude wasn’t in his right mind.

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    • Actually that’s called human nature (referring to the quote), if someone just stole your life’s work, wouldn’t you be angry enough to say things like this, whether you meant them or not? By the way my question is rhetorical because I already know the answer is yes, because I understand human nature.

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      • thejuanald says:

        Here’s that other Jobs quote that I love, “Picasso had a saying — ‘good artists copy; great artists steal’ — and we have always been shameless about stealing great ideas.” Jobs loved to have this holier than thou attitude towards other companies using anything even similar to Apple, but didn’t seem to care about blatantly stealing ideas from others.

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      • Ben Lovejoy says:

        Though, to be fair, his point was that Apple copied concepts, then figured out the best possible implementation. His complaint about Android was that it copied Apple’s implementation, and that’s what the patent trials have been about.

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      • thejuanald says:

        To be fair, that’s nitpicking a bit too much. Apple taking the idea from Android about the notification bar, google chrome cloud sync, etc. is fine because they just liked the ideas. Now I get it.

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      • thejuanald says:

        That’s not to say that I think it was wrong for Apple, nor was it wrong for Android to take ideas from Apple. That all just leads to better hardware and software across the board. The problem is that Apple seems to think their own rules don’t apply to them. That’s all that bothers me.

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      • The notification Bar for IOS was not from Android but from the IOS Jailbreak community and it was around before android had it Apple even hired the developer to work on the Notifications Bar for IOS.

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  3. Well, this reminds me of the admonition: you can’t fight every battle.

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  4. Before I start focusing on the part point of the article, one thing to remember is the context of what Steve Jobs was saying this in. Remember that in the mind of Steve Jobs they were screwed over by Microsoft and for him the whole ‘show down’ with Android/Google and Samsung is a repeat of history and he wanted to make damn sure that it didn’t happen again. In other words there was a lot of emotional baggage tied up in Steve and his relationship with Apple – a lot more than what most CEO’s would engage in.

    As for Samsung, they’re reeling because the quarter before last was due to massive channel stuffing rather than genuine sales which has resulted in Samsung having to clear the channels before they can move forward – expect more bad news from their mobile phone and smart phone division. Oh, and also the habit of them throwing end users under the buss when it comes to Android updates and upgrades doesn’t help their situation. My only hope is that in Samsung’s loss of marketshare we’ll see HTC strengthen especially now they have their Android L guarantee (update within 90days of Android L being released) and the strong line up of phones (personally I don’t care about the camera and cannot work out why so many people have a fetish over cameras in a phone – if you’re taking that many photos to care about the quality then you need to truly get a life).

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  5. Apple needs to invest some of its billions in strategic manufacturing and supply deals with other companies in an effort to cut Samsung out of their supply chain. The lawsuits are playground insults, but taking money form Samsung’s bottom line by altering the supply chain will mean real bruising. Work your way to cutting them off completely. Samsung will take care of the rest with their own foibles.

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    • Playground insult? So if someone stole your house that’s a playground insult? The number one thing this is about is not allowing someone to copy what they were smart enough to create, and spent their time creating.

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      • cleesmith2 says:

        Smoothies, don’t get so caught up in the verbiage that you miss Bruno’s point – which is spot on.

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  6. Steve Job’s quote literally blatantly states it’s not about money………..

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  7. In an effort to support people’s rights, Apple understands that humans also have the right to buy cheap gimmicky imitation crap if they want to. So they are letting Samsung off the hook for now.

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  8. Really good piece. I think it’s time they end it. It’s become a circus.

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  9. Bryan Hough says:

    My HTC One m8, costs just 50 dollars less off contract than the competing iPhone. I hate this idea that we Android users buy Android because its cheap. I buy Android because i simply prefer the operating system. I actually switched to iPhone 5s in April when I upgraded from my Nexus 4. I returned the device within 14 days for the HTC One because I simply find iOS to be inferior. I love the iPhone hardware, small screen size aside, but the operating system is horrid. The notifications especially. I’m in no way trying to launch an inflammatory post on here and start fighting on a comment forum, however the myth thay people purchase Android phones solely due to price needs to end. Its true that the are cheap crappy plastic Android phones out there, no doubt. But the high end android phones smoke the iPhone in every conceivable way. I understand that this is just my own opinion, but in my time with the iOS, I found it to feel like a smartphone with training wheels, good for my mom and my 68 year old Aunt Carol. I need a phone that’s CAPABLE.

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    • Ben Lovejoy says:

      It’s indeed the case that there’s little price difference between iPhones and flagship handsets from Samsung and HTC. My point, though, is that Samsung is struggling to make money from its high-end handsets and has a stated intention to focus more on the low-end and mid-market.

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    • The HTC One M8 is a very nice phone and to he honest if I weren’t so wedded to iCloud ecosystem I’d jump ship tomorrow (HTC’s synchronisation application isn’t too bad when compared to the abomination that is Samsung Kies) and personally if Samsung declines I’d sooner see HTC pick up the slack because for the last two products they’ve launched two really good high end phones that have been bashed without mercy by the Samsung fanboys thus giving very little space in the way of balanced reviews. I’m waiting to see what the HTC One M8 successor is and comparing it to what Apple has to offer with the iPhone 6 and iOS 8. I agree with you when it comes to their notification centre – it is something tacked on as an after thought that than something integrated in as part of the operating system – like a Victorian era house with a glass house extension that is completely out of keeping with the rest of the house.

      As for the relationship with Android and ‘cheap’ – 66% of Android sales are low end sales so in terms of volume if you remove the low end segment and compare Android high end sales to iOS sales the gap isn’t as big as the likes of Samsung try to make out. Android has its benefits but it has been a rocky road for those of us who prefer having consistent update/upgrade policy rather than “buy a phone and hope like crazy that they support it for more than a year”. HTC has come out with its 2 year pledge along with a promise of Android L within 90 days of its release but too bad they haven’t been more vocal about that when compared to Samsung who threw their customers under the bus after saying that they would not bring Kitkat to Samsung Galaxy SIII which leaves much to ponder when/if the Samsung Galaxy S4 or S5 will receive Android L or whether those users are thrown under the bus for the sake of motivating people to upgrade.

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  10. saoir says:

    No. Apple should continue to fight for what is their. Samsung is nothing but an ideas coying machine and Apple should hold them responsible for that.

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  11. Jack Gnasty says:

    Ben’s been pretty vocal about his lack of support for litigation against design thieves. I wonder how he feels about other websites plagiarizing the work of 9-5 Mac?

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  12. True…not worth spending your legal dollars on a dying competitor.

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