08-26-2012 16:39
Koreans could miss out on new iPhone

An Apple iPhone 4S is displayed at a store in Seoul, Korea. It remains to be seen whether a jury¡¯s decision in San Jose favoring Apple in its intellectual property dispute with Samsung Electronics will result in its Korean rival retaliating by seeking a sales ban on any future iPhones in Korea.
/ AP-Yonhap

By Kim Yoo-chul

A landmark victory for Apple in its intellectual property dispute with Samsung Electronics could pretty much turn out to be a crushing blow to Apple consumers in Korea.

Industry sources find it likely that Samsung will assure Apple¡¯s next iPhone, which may or may not be named the iPhone 5, is blocked from Korean shelves for a considerable time.

The next iPhone is widely expected to be the first Apple smartphone with the ability to work on fourth-generation (4G) long-term evolution (LTE) networks. But LTE is actually one of the areas where it has been lagging visibly behind its Korean rival, the other aspect being larger smartphone screens.

Apple is in negotiations with Korean mobile-phone carriers SK Telecom and KT over the local launch of the next iPhone, which could be unveiled as early as sometime in September.

Supporting LTE on its iPhones will be more difficult for Apple than when it was pushing 3G devices. Different countries use different radio frequencies for their LTE networks, requiring Apple to install different communication modems for the various countries.

This also complicates the negotiation with carriers over supply, and SK Telecom and KT worry that Samsung will push for a sales ban on the newest iPhone. According to company officials, Samsung is not only seeking a sales ban in Korea, but also in Britain, France and even the U.S., the nation of its recent humiliation.

``Yes, we are mulling the possibility to file to block selling the new iPhones in Korea. However, no decision has been made, as a limited move in Korea won¡¯t have much impact on our business overall,¡¯¡¯ said one Samsung executive, who didn¡¯t want to be named.

``If we do push for the sales bans, European countries will be our next targets after Korea. We did file for a preliminary injunction for the iPhone 4S in France and Italy, but only received limited results.¡¯¡¯

A separate Samsung source also confirmed that the company¡¯s legal strategies team is logging long hours of meetings to prepare a ``Plan B¡¯¡¯ in the wake of the crushing loss in San Jose.

Samsung¡¯s victory in Britain, where Apple was ordered to publish advertisements to major local newspapers saying Samsung didn¡¯t copy Apple devices, feels like ancient history.

By all accounts, Samsung is ready to be even more combative in an intellectual property dispute already described by critics as pathologic. And its renewed aggression against Apple will start in Korea, much to the dismay of local Apple fans.

``It would be no surprise to see Samsung seek a sales ban on the next Apple product. If Apple supports LTE functionalities in its next iPhone, then Samsung will have more leverage as it has more wireless technology patents. When you look at LTE, technology is far more important than design,¡¯¡¯ said Song Jong-ho, a senior researcher at Daewoo Securities.

``Samsung will be well positioned to be granted the sales ban in Korea if it goes for it.¡¯¡¯

Just a few hours before the verdict in the United States, the Seoul Central District Court ruled that Samsung didn¡¯t copy Apple and ordered the iPhone maker to pay more in return for using Samsung-owned wireless patents.

The Seoul court ruled that there was ``no possibility¡¯¡¯ that consumers would confuse the companies¡¯ smartphones and tablet PCs. It also said that Samsung¡¯s smartphone icons didn¡¯t infringe on Apple¡¯s patents.

``If Samsung needs any symbolic victory, then it will file a sales ban on the upcoming iPhone in Korea as the local court sided with Samsung, already. But when you look at the impact, the fight in Korea looks small. This is the problem pushing Samsung to hesitate,¡¯¡¯ said the Samsung executive.

The number of South Korean LTE customers hit 8.4 million last month, according to the data from the Korea Communications Commission (KCC), the nation¡¯s top telecom regulator.

Top local carrier SK Telecom holds around 4 million subscribers, while second-place KT has around 1.4 million. The number of LTE users in the country could soar as high as 16 million by year¡¯s end. That could put more pressure on Apple to decide whether designing LTE iPhones for Korea is worth the extra cost and effort, according to experts.

Last year, Samsung mobile chief Shin Jong-kyun admitted it had considered filing a request to block the sale of the iPhone 4S in Korea. The Korea Times was the first to report the plan. But Samsung finally dropped the plan in the last-minute.

A Samsung spokesman Park Chun-ho declined to comment, while Apple spokesman Steve Park wasn¡¯t available despite multiple calls.