Did Apple Spend $100 Million So Far on its War Against Android?

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The “thermonuclear war” that Steve Jobs declared against Android may be getting bogged down in trench warfare that is rumored to have cost US$100 million or more, according to a source who spoke with Newsweek’s Dan Lyons.

Mr. Lyons wrote in a blog post: “a person close to the situation tells me there’s a rumor going around among the lawyers that Apple spent $100 million just on its first set of claims against HTC. Who knows if it’s true, but if so, Apple didn’t get a lot for its money.”

He goes on to note that when Apple fired the first salvos against Android handset maker HTC in February 2010, the company brought 84 claims based on 10 patents to bear. However, when the case reached an International Trade Commission judge, four patents were left — one was ruled invalid and two others didn’t cover anything Apple was actually using at the time.

Apple did score a victory with the final patent, but, Mr. Lyons wrote, “n reality the infringement involved a relatively tiny software feature, one that lets you press on a phone number in an email or Web page and bring up a menu from which you can choose to call the number, send a text message, and so on.” He noted that HTC can resolve that problem by either removing the feature or finding a different way to implement it.

Meanwhile, Apple has a second complaint against HTC in the works, while HTC has fired back with two legal claims of its own. And Apple is also involved in lawsuits and counter-suits with Samsung and Motorola.

In the end, Mr. Lyons mused, “everyone is going to settle … The court fights are really just a way of jockeying for position and trying to gain leverage for the great settlement that is yet to come. In that sense, whatever Apple is spending on legal fees is probably money well spent.”

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9 Comments Leave Your Own

John Molloy

Dan Lyons is a troll. Ever since he was outed as the fake steve jobs any gloss he once had has faded fast.

Ion_Quest

Next to pro sport stars, lawyers are most valued by US.

aardman

Dan Lyons’ disdain for Steve Jobs and Apple is so obvious I don’t know why people attach any credibility at all to anything he says about Apple.  “A person tells me there’s a rumor”— that’s hearsay about a rumor.  He’s so eager to say anything negative about Apple that he would disregard the basic tenets of journalism just to feed his animus.

And I don’t think there is a law office on earth that makes a $100 million except as their cut on a settlement or damages award.

jfbiii

That $100 million would have amounted to less than half a percent of profits. I think that whatever Apple is spending on legal fees is likely forcing other companies to spend an order of magnitude or more in terms of percentage of profits.

Put another way, legal fees by themselves are an additional cost that Apple imposes on other companies while having almost zero effect on their own bottom line.

John Dingler, artist

Watching Apple force infringers to waste money on legal fees is way better than watching the Superbowl.

Paul Goodwin

You’re right on jfbiii. With $97 billion in the bank, they can pay for a lot more lawyers than the other guys without feeling it.

Paul Goodwin

Haha JD good one

rwahrens

If Dan Lyons told me the sky was blue, I’d have to look outside to be sure it wasn’t cloudy!

RonMacGuy

jfbiii, that is exactly where I was going to go when I had some time to post. This reminds me of a high stakes Texas Hold ‘em poker game. When you are the chip leader, you can do things that you can’t do when you are just getting by. Sure, Samsung and HTC are huge conglomerations, but they have divisions and business units and product lines, each of which have to perform or die. And, when Apple spends their pennies suing the phone product lines and tablet product lines of these corporations, these companies spend dollars fighting the lawsuits, which (as relates to their specific product lines) is a serious drain on earnings for them. Given the competition on the hardware side of these android phones, margins are already thin, and margins are probably non-existent on the android tablet side (given how much, say, Samsung had to invest in capital and engineering to get a mere pittance of tablet sales thus far, not to mention Motorola with their dead-on-arrival Xoom). Trust me, I know how the corporate executive mind works, and even if Apple doesn’t win the lawsuits, Samsung, Motorola, and HTC executives are seeing the costs related to the lawsuits and the relative sales and profits of these product lines and wondering if it makes sense to stay in the game. Apple is playing a high stakes game, and can easily afford to do so.

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