What Apple’s sweeping victory over Samsung means for mobile investors

“The world’s most valuable company is now a little richer,” David Randall reports for Reuters. “A California jury awarded Apple Inc $1.05 billion in damages Friday in a decision that found that competitor Samsung Electronics Co Ltd had infringed six smartphone patents.”

“For investors, the jury’s decision likely means that the mobile industry will continue to be dominated by Apple. But that does not mean that other, less-obvious options do not exist,” Randall reports. “Microsoft Corp, Google Inc and parts manufacturers could all end up benefiting, at least tangentially, from Apple’s victory, analysts said.”

Randall reports, “The ruling could provide a boost to Microsoft, which has a valuable library of patents and an operating system that steers well clear of Apple’s legal claims, analysts said… ‘To some degree the win likely strengthens the possible success of Microsoft’s Windows operating system, as a larger number of original equipment manufactures may seek the relative patent safety of Microsoft,’ he said in a research note Monday.”

“Other investors are expecting Apple’s legal victory eventually to help its competitor, Google,” Randall reports. “Dan Morris, portfolio manager of the $4.5 million Manor Growth Fund, said that the case will spur Google to make significant changes to its operating system in order to avoid further legal questions. Its roughly $670 share price reflects more of its search business dominance than its Android business, he said, giving the company significant room to grow.”

Read more in the full article here.

MacDailyNews Take: Google’s workarounds are more likely to be less intuitive than Apple’s patented methods, not more. handset peddlers not named Apple are more likely to flee to the safety of Microsoft’s Windows Phone than to continue with Google’s fragmented morass of workarounds. Sorry to disagree with someone who manages a portfolio weighing in at a massive $4.5 million, but there you have it.

Windows Phone will be popular. Over time, it’ll eat the lunch of the increasingly fragmented, increasingly insecure, and increasingly costly Android (losing patent infringement lawsuits and dropping features/paying royalties to multiple IP owners will do that to you).

The not-iPhone world will begin to dump Android and move to Microsoft’s mobile OS offering because it will eventually cost less, work better, and come with far fewer legal issues. In the iPhone wannabe market, it’s already happening (Nokia, for example). We expect the same to happen in the iPad wannabe market, too [with Windows 8/RT]. Google and Microsoft will long battle each other for the non-Apple markets and that’s a much better scenario for everyone than having a single ripoff artist flood the market with fragmented, insecure, beta-esque, mediocre-at-best products. Google’s attempt to be the next Microsoft is doomed.

This, of course, will also impact Google’s search business. Apple’s Siri will increasingly deliver info to users sans Google and Microsoft will, naturally, use Bing for their search. As we’ve said many times in the past: “Google will rue the day they got greedy by deciding to try to work against Apple instead of with them.”

The bottom line: We’d rather see a company trying unique ideas, even if – shockingly – it’s Microsoft, than the wholesale theft of Apple innovations that we’ve been seeing for over four years now. Don’t steal IP. Even worse, don’t steal IP and “claim to be innovators.” We have no problem with any companies that attempt to compete with Apple using their own unique ideas and strategies.MacDailyNews Take, October 27, 2011


  1. Here’s what all this means. Apple won a victory ion court protecting its patents.

    Google will make the necessary changes to its OS to prevent this from happening again.

    A year from now both companies will be in the same relative position in the marketplace.

    Microsoft will solidify its offerings around its OS. This will keep Microsoft from becoming irrelevant.

    Life will go on.

  2. I’m getting such a kick out of these analysts who are writing, apparently with a straight face, that an Apple victory is good for their competitors because now the competitors will be forced to innovate!

    As if Samsung, Google, and the rest were capable of amazing innovation, but just didn’t want to do it because copying Apple was easier.

    Get real. If these companies were capable of out-innovating Apple, they’d have done it by now. A lawsuit isn’t somehow going to force genius out of them.

    So if there had been a similarly huge iPod lawsuit, I guess that would’ve inspired Creative and we’d all be using Zen players?


  3. I think a lot of people are missing the point. Apple is an innovator, par-excellence. The win over Samsung has an immediate impact, but workarounds are probably do-able in the short term. But the real value to Apple is that its FUTURE innovations are now protected – and it will be the new ideas that Apple introduces which will knock the copyists out of the market. IPhones 5, 6, 7, 8 etc can all be expected to introduce new features – and Samsung and others will now have to think twice before copying them.

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