Apple wins $1bn case against Samsung

The more important aspects of the verdict are that it found Apple’s patents to be valid and that Samsung wilfully and knowingly copied Apple.

Apple has won a massive victory in the latest round of its dispute against Samsung. Part of the case is on patents, and part of it is on “trade dress” (the look and feel of the iPhone).

The $1bn award sounds like a lot, but it isn’t really the most interesting part of the decision. The RIM/Blackberry case was much narrower but saw a $600m+ decision some years back. The more important aspects of the verdict are that it found Apple’s patents to be valid and that Samsung  knowingly copied Apple. The validity of Apple’s patents will probably allow it to earn a healthy stream of licensing revenue from other smartphone companies into the distant future. It will also give a well-needed jolt to the rest of the industry to explore different technological trajectories and to develop smartphones that do not resemble the iPhone as much. The willful nature of Samsung’s copying is why I believe the jury reached a surprisingly quick decision while others had expected it to be a protracted case, i.e., once they decided in their minds that Samsung willfully copied Apple, it was only a step away to reach the conclusion that Samsung infringed across a broad range of its products (see this chart at TheVerge). Very bad news for Samsung.

Some people view this as part of Steve Job’s vendetta against Google, which created the Android operating system running on Samsung’s phones. While this may or may not be true, it is not the whole story. The Android operating system is quite versatile and it is possible to build quite a diverse and novel ecosystem around it without copying the iPhone. An example of this is Sony with its aesthetically elegant Xperia phone and Android-based Walkman. Another is Nikon which has just released an Android camera and is an iteration away from it becoming an actual phone.

No doubt the Samsung/Apple ruling will be appealed, but it will inevitably shape the future of smartphones.

Is Secrecy Always A Good Thing? The Tale of Apple Aperture vs Adobe Lightroom

Apple is known for its penchant for secrecy. Products are developed as top-secret projects and unveiled to the public with great fanfare. This has brought it tremendous benefit, for example with during the dramatic launch of the iphone by Steve Jobs (http://www.youtube.com/watch?v=vZYlhShD2oQ#t=2m20s). However secrecy carries costs, and in some cases the costs outweigh the benefits. Yet Apple retains this approach across a whole range of its products; secrecy is apparently “baked into the corporate culture” (http://www.nytimes.com/2009/06/23/technology/23apple.html). Consider Aperture 3.0, the newly updated photo-management product by Apple aimed at professional photographers. It was launched last week following Apple’s usual “secret till the last minute” approach. It is instructive to compare Aperture to Lightroom, a very similar product by Apple’s rival Adobe which has taken a very different approach.

There have been two effects of the secrecy surrounding Apple’s Aperture 3.0. First, the direct effect of launching poorly-tested software. Twitter and the Apple forums are full of complaints by anguished customers who have been unable to upgrade older photo libraries (e.g., http://discussions.apple.com/thread.jspa?threadID=2331026). No doubt there is a selection bias and users with a trouble-free experience are less likely to visit these forums and complain. But this is hardly the “awesome” and polished experience that is expected from Apple, a company that uses “it just works” as a tagline. Among the reports are complaints by customers whose computers have totally frozen during the upgrade, those who succeeded in upgrading but then found it unstable, and those who gave up but were unable to reinstall earlier versions of that software. It is clear from these reports that Aperture 3 was insufficiently tested before being sold, especially against real-world photo libraries in use by existing users.

A second effect of secrecy is that professionals have been increasingly adopting Adobe Lightroom. While the buzz of unveiling a new product may matter for consumer-oriented products like the iphone or ipad, Aperture is aimed at professional photographers, design companies and media organisations. For this audience, surprise may be less important and even counterproductive. Instead , advance knowledge of upcoming features and a stable product at launch time are probably more important. These allow the client to anticipate changes and plan for its integration into existing workflows and business processes.

In contrast to Apple, Adobe has taken a different approach with Lightroom. In October last year it launched the new version as a public beta, available for anyone to download and try for free (the software expires automatically at the launch of the actual product). The public beta gives Adobe precious information from real-world customers on a massive scale. In addition, customers are able to experiment with features likely to be included in the final version, rather than being kept in the dark with no way to anticipate and plan their own businesses around Adobe’s roadmap. Lightroom has its share of detractors, but generally the response online has been positive. The important thing to point out is that Adobe isn’t one of these “open source” players. Lightroom is commercial software that is quite expensive and the guts of the software are heavily protected. However, by being less secretive than Apple, Adobe is able to engage better with its customers. This applies not just to the public beta: in earlier versions of Lightroom, Adobe took a more open stance towards allowing third-party plugins and introducing user-created presets.

Looking more broadly, my sense is that Apple’s secrecy is costing it not just with Aperture but also with other recent product launches. For example, iPad developers are in a scramble to develop software for the new device which ships in about 2 months. Apparently even Apple’s close allies were introduced to the iPad just weeks before it was publicly announced. Even Apple’s new Snow Leopard operating system had its share of bad surprises after it was launched, causing some cases of data corruption. To this day, none of my colleagues are able to print from it to our enterprise-quality printer down the hallway using the Safari web browser or the Preview tool without causing the software to crash. The lesson to be learnt is that while secrecy may be useful for some products, firms (including Apple) should revisit the question as to whether they need to be secretive across all their products.

Do share your thoughts and comments on our discussion board.

—- update on 17 March 2010

A quick update – after writing this article I received a surprising number of emails. Quite a few photographers and media professionals wrote to say they agreed with my perspective. A few disagreed, including some folks who said Adobe also had its share of problems. A few people also wrote to complain that I am biased and “anti-Apple”; I contend this is untrue seeing that I personally own a lot of Apple products.

A couple of people asked what the benefits were of secrecy, and to give a quick answer, it generates greater consumer buzz when the product is launched (as mentioned). In addition, secrecy is one of the mechanisms by which firms attempt to protect intellectual property (e.g., the oft-told story of Coca Cola’s secret recipe). Keeping something secret may also help prevent competitors from hiring the relevant people to develop similar products, although this is controversial as it depends on how scarce the relevant skills are. I hope this helps give my article some balance. I’m not saying secrecy is bad in general, but that it should be used when appropriate. It may be somewhat less effective for professional rather than consumer products, especially software which involves network effects and benefits from a cohesive developer community.

A spokesperson from Apple wrote to me to say that a number of photographers did work with Apple on the beta prior to launch (but as I understand it from people in the industry, this was a private beta and a non-disclosure agreement was involved). Apple also said many of the issues have been addressed in a recent upgrade to the software, and they dispute the market share data used by John Nack which I linked to in my article. They also made a few other points. I am sharing this so that their view is represented and they are welcome to post a reply too, however I don’t think it takes away from the main points of my article. Subsequent to my post, I learnt that Apple’s secrecy was also a concern raised by various photography blogs (e.g., http://photofocus.com/2010/02/17/aperture-3-0-very-cool-but-not-ready-for-prime-time/). Moreover, the extensive fixes that were made soon after Aperture’s release shouldn’t have been needed in the first place if the software had been properly field-tested. Fundamentally, secrecy means missing out on engaging with the professional community and developers in an extensive way prior to the product’s launch. That is the price to pay, and while in some cases this is worthwhile, in other cases its not always a net benefit.