Arik Hesseldahl

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A Look Back at the Second Week of the Apple-Samsung Trial

Calling the Apple versus Samsung patent lawsuit the most closely watched case of its kind in recent memory isn’t exactly going out on a limb, and that’s because the disclosures of details previously held close to the vest by both parties have been so numerous and, well, so interesting.

The trial’s first week was widely described as something of a slapfest, during which lawyers for both sides aimed to sting the other by forcing one painful bit of previously secret information after another into the record of evidence.

Though the second week had its snoozy moments, the fascinating disclosures kept on coming, and ended with nothing less than a bombshell. Here are the week’s highlights:

Apple Offered Samsung a License on Its Patent Portfolio

“Shocked” as it was by the iPhone-like look of the first Galaxy phones, Apple considered its relationship with Samsung — a key supplier of chips and other components — important, and was willing to make a deal. In October of 2010, it offered Samsung a license on its patents for $30 per phone and $40 per tablet. It also offered a 20 percent discount, if Samsung was willing to cross-license its portfolio back to Apple. By Apple’s reckoning, such a deal would have brought in $250 million in 2010. It’s now seeking 10 times that much in damages from Samsung. It was on this surprising little bombshell that the week’s proceedings ended.

Samsung’s U.S. Tablet Revenue Was Less Than 5 Percent of Apple’s

As often as they’re held up as competitive devices, Samsung’s Galaxy Tab barely moves the sales needle when compared to Apple’s iPad, at least in the U.S., according to Samsung documents that were admitted into evidence. As AllThingsD’s Ina Fried put it, Samsung sold fewer tablets during the entire seven quarters in question than Apple did in its worst quarter. Samsung recorded U.S. tablet sales worth $644 million, or less than 5 percent of the nearly $15 billion Apple generated during the same period.

Samsung Competes Better With Apple in the Phone Business, but Is Still Way Behind

The Korean electronics giant wasn’t the only one forced to pry open its books for inspection. Apple disclosed, for the first time, a U.S. breakdown of its unit sales of iPhones, iPads and iPod touches from 2007 through the first half of this year. The result: Apple sold 85 million iPhones in the U.S., worth $50 billion in sales; 34 million iPads, worth $19 billion; and 46 million iPod touches, worth $10 billion and change. For its part, Samsung disclosed that in the two years ended June 2012, it sold 21.25 million phones, generating $7.5 billion in revenue. Its best-performing individual model was the Galaxy Prevail, which sold 2.25 million phones.

Samsung Said in an Internal 2010 Report That Its Galaxy Would Be Better if It Were Just More Like the iPhone

Lawyers for Apple introduced into the record a 132-page internal Samsung report that examined, feature-by-feature, how its Galaxy S I stacked up against the iPhone. The verdict of Samsung’s product designers, who wrote it, was simple, and from the standpoint of Apple’s lawyers, pretty damning: Make it more like the iPhone. Samsung called the report a routine “competitive analysis.”

Samsung Customers Might Pay Extra $100 for Apple-like Features

If it followed the advice of its own product experts and made its phones more like the iPhone, Samsung’s customers might have to pay as much as $100 more per phone. That was the conclusion of John Hauser, a professor at the Massachusetts Institute of Technology, who conducted a detailed study of the three disputed Apple utility patents. His study found that customers said they were willing to spend up to an additional $100 on a smartphone or $90 for a tablet that incorporated all three features created by the patents. Under cross-examination by Samsung lawyers, Hauser explained that in the study, customers were asked how much they might be willing to spend on a set of features, but were never asked to weigh those costs versus other expenses they might have. This would, Samsung laywers argued, create a “reality check” on Hauser’s findings.

Patent Lawsuits, No Matter Who the Litigants Are, Can Be Boring

For all their vaunted importance, patent law is, as legal subgenres go, a pretty dry subject. Sooner or later, you wind up talking about the kind of in-the-weeds details about which only practitioners of the art give a fig. On Friday, lawyers for Apple called one expert after another to testify about patents governing features as varied as the “bounce back patent,” and others referred to only by the last three digits of their patent numbers. One of the patents, testified an expert using a technical term, is intended to help save users a lot of “fiddling around.” Snoozing yet?

Apple is expected to wrap up its case next week.

Apple versus Samsung Full Coverage


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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work