Is Apple turning into patent troll?

By Kim Yoo-chul

Intellectual property disputes have escalated worldwide with Apple, the maker of iPhones and iPads, somehow involved in every technology feud that matters today.

This has some observers wondering whether the California-based company is becoming less of an innovative force than an opportunistic “patent troll,” intent on trapping rivals with litigation rather than letting consumers decide which are the best products.

David Drummond, a legal expert representing intellectual property related to Google’s Android mobile operating system, recently criticized Apple on his blog, saying that, “patents were meant to encourage innovation, but lately they are being used as a weapon to stop it.”

Patent experts understand where Drummond is coming from.

“It’s regrettable that Apple is concentrating more on taking competitors to court than developing its next line of wow products,” said Jeong Dong-joon, president of local patent firm, Su.

“Under the leadership of the late founder Steve Jobs, Apple maintained a pace of releasing new products nearly every year. Under Tim Cook, however, Apple got into litigation quicker, but its products have not been as impressive.”

The worries that Apple is abusing its supremacy in consumer smartphones and touch-screen tablets to suppress innovation are shared by officials in the United States, where the company is coming off a victory against Samsung Electronics, its biggest rival.

A jury in San Jose recently awarded Apple $1.05 billion in compensation, supporting its claim that Samsung has been slavishly copying the look and feel of iPhones and iPads in its own Galaxy lineup of mobile Internet devices.

“I hope Samsung Electronics can sell its products in the United States despite the (recent California jury) verdict,” John Read, chief of the antitrust division at the U.S. Department of Justice, recently said.

Samsung is hardly the only company on Apple’s hit list. HTC, Motorola and Google have been struggling to defend themselves against Apple’s wrath, although Google seems to be holding under-the-table negations seeking a truce.

“Apple isn’t the Apple that we saw under the reign of the late Jobs. Apple is too arrogant. I can say Apple is losing its Apple style. Partnerships with parts suppliers have seen a rapid deterioration and the frustrating Cook is losing his grip,” said a senior Samsung official, understandably bitter about the San Jose verdict.

It’s debatable whether the time, money and effort spent on litigation is making Apple less productive product wise. At least on the surface, the company appears to be maintaining its usual pace in product releases. Apple has traditionally maintained a 12 to 16 month period between introducing new products. The new iPhone, which may be named iPhone 5, will be unveiled this month, 11 months after the company brought out the iPhone 4S.

The problem, however, is that Samsung used that 11 months to dramatically close the smartphone gap.

“Clearly, the patent fights are costing Apple. Samsung now has the largest share in the smartphone market. Although Apple’s presence is still impressive as it represents only a single product, it doesn’t inspire confidence that it was helpless in allowing Samsung to become this powerful,” said Seo Won-suk, an analyst at Korea Investment and Securities.

“Cook chose patent as his top word by dropping innovation, which has been hurting its bottom line and consumer choices.”

During the second quarter of the year, Samsung sold 50 million smartphones followed by Apple with 26 million, data from Strategy Analytics (SA), showed. Samsung rolled out two flagship smartphones — the Galaxy S3 and Galaxy Note 2 — in May and August, this year.

A previous study by Boston University said that lawsuits are increasing and the overall cost of these cases in the U.S. was $29 billion, last year. The study insisted that the cost burden falls on new market comers and thus curbs innovation.

“We conclude that a top priority for policy makers should be reforming the patent system to make it perform more like an idealized property system and that the reform should address troll-like behavior. The patent system still needs significant reform to make it a truly effective system for promoting innovation,” James Bessen and Michael Meurer, the authors of the study said.

While it appears to be winning the war, Apple has lost at least one battle against Samsung in San Jose, when Judge Lucy Koh ruled against a request by Apple to delay lifting the temporary ban of Samsung Electronics selling its Galaxy Tab 10.1 tablet.

A hearing was originally scheduled for Dec. 6, to determine whether or not to ban the sale of certain Samsung products completely in the United States and Apple had asked that this hearing be delayed.

“This is not a major setback for Apple, which simply tried to make a Samsung-style equal-treatment argument in hopes of a more favorable schedule. The only thing that Samsung really ‘won’ from the jury was a verdict of non-infringement of the tablet design patent, while Apple won on a long list of counts. I can’t see why its trial loss should indirectly entitle Samsung to a faster schedule,” said Florian Mueller, a German-based patent expert who is tracking Samsung-Apple disputes on his popular FossPatents blog.