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back to article Apple accuses Samsung of abusing its 3G power

Apple got in one last dig against Samsung in the US on Friday, claiming that the Korean tech giant abused its "monopoly power" gained by its ownership of wireless patents and demanded unreasonable royalties from Apple for its iDevices. The two firms raced to persuade the jury, which is due to start deliberating later this week, …

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Anonymous Coward

Funny

Asking pennies for things that actually make a phone work is considered unreasonable but asking $30 for 'dress' patents that never should have been granted is considered OK.

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Anonymous Coward

Re: Funny

Hello Pot, I'm Kettle. How are you? Nice black splotches you have there, wouldn't catch me having those

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Re: Funny

You don't need to copy trade dress and functionality to make a phone work with current standards. Just make it original and different. Not so with SEPs.

This would give Samsung power over the entire phone market, obviously that's not OK.

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FAIL

"Oh no they have patents I need, woe me. They have to license FRANDly!!11!"

You want the patent system, so you gotta suck it up I reckon.

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Anonymous Coward

Re: Funny

Erm, if they are so non-essential then why did Samsung bother to look at the iPhone and then replicate how it looked?

They know all too well that appearances matter. People don't all wear grey clothes made of hessian and wear clogs, they like to wear nice clothes so they look and feel good.

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Re: Funny

All sports shoes need to look like Nikes? Different does not imply "won't sell". Samsung didn't try to work out what they could do differently and possibly better, they just assumed that all of Apple's choices were right and copied them as close as they thought they could get away with. Apple says that was too close.

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Unhappy

Re: Funny

When making existing technology look pretty is what earn you billions, you can see how they get seduced into thinking that is worth so much more than the technology behind it. Unfortunately in a society where you can triple the price of a pair of jeans just by putting a label on it, there is some truth to that argument.

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Re: Funny

"They know all too well that appearances matter. People don't all wear grey clothes made of hessian and wear clogs, they like to wear nice clothes"

I think you dumped on your own argument there. People LIKE to wear nice clothes but they are hardly essential for survival. An iPhone-like UI may be the best way to make money but a drab and unusable UI doesn't make a device technically incapable of operating on a standard cellular network which is the single qualification for an SEP.

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Apple determined to look like the good guy to the Jury

It seems to me that this was the strategy all along. Apple's technical arguments seem weak, so it appears their lawyers felt their best shot was to paint Samsung as the bad guy. I really hope the Jury doesn't get swayed by this and decides the case on the strength of the arguments presented - irrespective of who they decide for/against.

That said, the fact that they didn't get to see all of the evidence (both Apple and Samsung wanted to show more) will mean an Appeal will be made. If an appeal goes ahead, then "what was the point in having the trial"?

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Re: what was the point in having the trial

IMHO you hit the nail right on the head. If this farce was giving the go ahead the evidence should have been allowed, I know samsung were late but without it if they lose this has got to be great grounds for an appeal. Course, I don't know the law and not sure if it can even be allowed in an appeal.

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Re: Funny

How do pennies amount to half the price of an iphone ??? Does Samsung have 10 000 applicable patents?

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Anonymous Coward

Re: Funny

Citation needed, please point me to somewhere that claim Samsung want half the cost of an iphone. Most reports on the subject seem to agree that they asked 2.5% which covered all their relevant patents and not 2.5% per patent which is the only way I can think you have come up with that ridiculous figure.

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Stop

Re: Funny

RTFA. The argument is that EVERYONE with a 3G patent wanted the same kind if deal then 50% of the cost would be taken up by patents, not that Samsung alone wanted 50%

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Re: Funny

> This would give Samsung power over the entire phone market, obviously that's not OK.

Funny how Nokia were able to happily make a million phones a day and not have a the slightest problem with Samsung's "power over the entire phone market" while Apple fined it impossible.

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Stop

Re: Funny

That's about normal. I point out what is ACTUALLY written in the article & who is claiming what, and the fandroids go mad and down vote it. Carry on with the RAAAGE chaps, you clearly have no logical arguments to the contrary.

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Anonymous Coward

The jury

We're all provided with iPads loaded with the case information and documantation so that they could come to a fair decision after deliberation.

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Facepalm

Re: Funny

"Funny how Nokia were able to happily make a million phones a day and not have a the slightest problem with Samsung's "power over the entire phone market" while Apple fined it impossible."

That would be why the rules on SEPs state that they must be 'Non Discriminatory'. Each licensee can still do separate deals, but they're supposed to give everyone a fair shake - regardless of how successful they are, how much of a competitor they are, or indeed how pally-pally you are with them.

The accusation is that they're using their patents either to shake Apple down, or to hurt their ability to compete. Problem is they signed away their right to do that with these patents when they were granted SEP status.

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Re: Funny

If Nokia and Samsung both have SEPs which they charge at 10% then in effect neither pays royalties to make phones. Apple has nothing to offer so gets charged 20%. That's fair and non-discriminatory.

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FAIL

Re: Funny

You missed out Reasonable. If the two are charging 10% royalties then they have to show that 10% is reasonable and its similar to the amounts charged by others in the patent pool. There are about 30 companies in the pool, so if each asked 10% then anyone not in the pool would have to pay 300%, which manifestly ISN'T reasonable.

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Re: Funny

It's reasonable if the technology is worth that much. If it's worth that much then it's not reasonable to offer them any less.

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When companies commit patents to FRAND

They do so knowing that what is considered reasonable in FRAND terms is much less than normal patents, but in doing so they will get much more total income. Someone charging 10 cents per device on 3G patents would have made over 100 million last year. They'll keep on making that or more until their patent expires, easily over a billion dollars total, not bad considering that they only have to collect it, not make anything.

The standards setting body will deliberately try to remove or engineer out any patent that is considered too expensive. The technology is also in competition with other patents, the prize being to be included in the standard. The result is that what's on offer must be both cheap and good. Part of the objection here is that Samsung were late in declaring that part of the 3G spec was covered by one of their patents, making it hard to remove in favour of competing technology. This was a breach of the rules also.

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Re: When companies commit patents to FRAND

If it shouldn't be included under FRAND then they can charge what they like. If it's a required part of the technology but was declared too late to be removed in favour of other technology which was declared even later, then who really cares?

If something is worth paying for then people will pay for it (unless they can steal it). If the technology adds no value then it has no value, but it does add value so it should be paid for.

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Headmaster

Minor error

It wasn't 75 witnesses it was a 75-page document containing details on 22 witnesses.

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Win Win for everyone

Both Samsung and Apple are winners here, they are both gaining a huge amount of publicity, albeit at the expense of each other.

Ï would love to see Koh give both of them a kick up the arse and make them both pay for wasting everyones time. The fines could go to some worthwhile cause.

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Anonymous Coward

Re: Win Win for everyone

Motorola are now in on the act. So those who think Google are nice people who don't sue people or try to restrict competition should think again.

http://www.theinquirer.net/inquirer/news/2199745/motorola-mobility-seeks-bans-on-the-apple-iphone-and-ipad

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Re: Win Win for everyone

... and this is definately not a response to Apple suing everyone and everything remotely able to compete with their products?

So to sum it up: Apple suing everyone because of rounded corners or a software version of a sliding lock is good for innovation? Google and Motorola responding to it, is bad?

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Google sticking it to Apple?

I had to giggle at this:

http:= http://www.informationweek.com/internet/google/google-enhances-patent-search-service/240005483

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Re: Win Win for everyone

This is exactly what Samsung should have done ages ago. They should never have waited until apple took them to court before they upped the ante for apples failure to license their patents (yes I know they are frand but they still need to be licensed). Motorola and apple have been at logger heads for ages, predating google's aquisition by far and Googles really need to be seen doing something about the uncertainty of android,

Hopefully something will come out of this that provides some stability to the android ecosystem rather than just motorola. Maybe one or two conflicts like this between huge companies is what is required to either force everyone to cross license or get the US government to address the mess. It's helping nobody but lawyers, who probably don't spend most the cash and just dump their money into some tax saving scheme.

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Re: Win Win for everyone

"Motorola are now in on the act. So those who think Google are nice people who don't sue people or try to restrict competition should think again."

I have thought again. And my thoughts were "Awww, shame, poor Apple."

Closely followed by "HA HA!" in the voice of Nelson Muntz.

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Re: Win Win for everyone

Though my understanding is that Apple started this case, not Samsung. And it's Samsung devices that are banned in the US in the meantime, not Apple's. So it's not really as case of "they're as bad as each other" - it's rather one-sided, and Samsung are just quite reasonably doing their best to fight against this.

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Re: Win Win for everyone

Google are suing in an attempt to protect their platform. Apple has gunned at Android for long enough and even nice guys are entitled to defend themselves.

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Re: Win Win for everyone

Motorola want to be paid for their work, Apple want to stop anyone using ideas similar to their own. So only 1 of them is using the patent system to restrict competition. But if Apple decides not to pay for other's work then the only option is the courts, and threats of a ban.

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Headmaster

@KjetilS Re: Win Win for everyone

If you are going to bold-face one word to draw extra attention to it, you might want to spell it correctly.

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Sammy overcharging Apple over patents. ROLF.

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Sammy overcharging Apple over patents. ROFL

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Coat

I object to this post. It's a blatant rip off of the previous one with only minor cosmetic differences!

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Happy

@Allicorn

You've won the internet :)

\o/

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Joke

I'm beginning to like the BOFH solution

We take representatives from Apple and Samsung, and while we're at it, representatives from the Patent office and other litigious patent holders. We lock them in a room with a half brick each and declare the last man standing as the winner.

The sad thing is that the outcome would be no worse than the current situation.

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Re: I'm beginning to like the BOFH solution

"We take representatives from Apple and Samsung, and while we're at it, representatives from the Patent office and other litigious patent holders. We lock them in a room with a half brick each and declare the last man standing as the winner…”

…and then engage the halon system.

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Re: I'm beginning to like the BOFH solution

Well looking at the olympic medal tables for armed and unarmed sports I think I know who my money would be on.

South Korea 22 Medal 12 Gold

USA 16 Medals 7 Gold

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Joke

Re: I'm beginning to like the BOFH solution

Why settle for half measures? Let's round up everyone who bought a Samsung phone because it looked like an iPhone and shoot them. I think Samsung would settle for a 0.1% loss in future revenue to have the matter settled once and for all.

Then, in the interests of fairness, we can do the same thing to everyone who bought an iPhone because it looked like an iPhone. Apple have plenty of cash, they can stand to lose 75% of their customers.

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That anybody could keep a straight face in the courtroom

While all of this crap is going on is little short of a miracle.

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Facepalm

Re: That anybody could keep a straight face in the courtroom

The jury were too busy falling asleep to laugh. That's why judge Koh regularly asked if anyone needed caffeine throughout the jury days.

Don't know what to read into that but I really hope it's because they found Apples design patents so ludicrous they couldn't maintain any interest in the horse shit Apple were shovelling ;)

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Paris Hilton

2.4% is unfrandly?

These essential patents that Samsung are massively overcharging for...

Several articles around the web mention that Sammy already have licencing deals with intel etc for these patents. If the complaint from Apple is that Sammy are charging too much for it to be Fair, Reasonable and Non-Discriminatory - surely the total cost if everyone charged the same (50% of phone value as reported above) is irrelevant. The only thing that would make Unfair, Unreasonable or discriminating is if they charge Apple more than Intel (or whoever) to licence the same patent.

Or am I missing something?

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Re: 2.4% is unfrandly?

I don't think Samsung managed to show anyone was paying 2.5% of the RRP of a completed device. Most companies get their license as part of the cost of their baseband chip. These sell for about $10. I'm sure Apple would have no problems with paying a fixed 25 cents per phone (they were getting this via Qualcomm until Samsung cancelled their cross-licensing deal with them), but the idea that anything with 3G needs to pay Samsung 2.5% of RRP is against FRAND principles.

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Re: 2.4% is unfrandly?

cant just consider the cost of the patent on its own. Samsung had put in an offer for cross-licensing patents.

the cost of the frand patent might be lower to other vendors, but if theres cross licensing then the cost is being lowered as a result. apple not being willing to share anything means it gets an unsubsidised rate and they're not happy.

curiously enough apple want to cross license now with their $30/40 fee per handset (resulting in a 20% "discount") for their rectangle with rounded corners BS,

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Not the way that accountants think

They don't treat the cost of a cross-licenced patent as zero, something that adds nothing to the cost of their devices. They had to forgo charging for their own patents, and that lost them money. The profit margin of completed chips includes this factor.

If you extend the argument, should Samsung be due 2.4% of the retail cost of a car with a built-in phone? What about a jet airliner with built-in phones? By convention only the module that provides the functionality attracts the fee.

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Re: Not the way that accountants think

Apple charges $100 for the 3g chip once it's been put in an ipad. 2.5% of the value created by Samsung's work seems fair, not 2.5% of whatever the cheapest chip can be made for.

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Re: Not the way that accountants think

Even if you assume that Apple charge $100 for the 3G chip (wildly inaccurate, the BOM shows a mark-up of about 3x on cost, which would put the 3G chip at around $30-50) then Samsung would only be due $2.50 per phone. They are asking about $15, i.e. they are basing their prices on RRP.

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Re: Not the way that accountants think

There's no need to assume but yes, I was wildly inaccurate.

Without cellular: 16Gb: $499, 32Gb: $599, 64Gb: $699.

With cellular: 16Gb: $629, 32Gb: $729, 64Gb: $829.

So Apple charge $130 for the chip when it's in an Ipad. How much have they offered to the people who did the work which adds $130 to the value of their product?

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