Apple’s HTC lawsuit is the first public manifestation of a series of private warnings Apple has been issuing to handset makers for a while now, says Yair Reiner of Oppenheimer in a note for clients, picked up by Philip Elmer DeWitt.
Here’s the story:
- In January 2009, Tim Cook said on an earnings call, “we will not stand for having our IP ripped off and we’ll use whatever weapons we have at our disposal.”
- LG, Samsung, and Nokia, etc. thought that warning meant stay clear of multi-touch. So they did. Notable exception — Palm, which Philip Elmer DeWitt writes “didn’t represent a strategic threat to Apple.” (Ouch!)
- At the end of 2009, the Motorola Droid and the HTC Eris appeared with multi-touch capability.
- Other handset makers waited to see Apple’s reaction. If it didn’t stop either company, then the handset makers would assume it was OK to use multitouch.
- Apple’s chief officers began telling other top level mobile phone manufacturers in January that it was not happy with these multitouch phones.
- Says Yanir, Apple let the world know it “was ready to press its case along a number of axes that had made the iPhone experience unique, from the interpretation of touch gestures, to object-oriented OS design, to the nuts and bolts of how hardware elements were built and configured.”
- Then Apple filed suit against HTC because it was the highest profile Android partner and served as the best proxy for Apple’s real enemy — Google.
The effect of the warnings, and the lawsuit, are huge, says Yanir.
- Until now, smartphone makers were trying to match Apple’s user experience, and not thinking about patents. Now all the companies are checking patents before proceeding.
- Says Yanir, “We believe a lot of software and hardware is being sent back to engineering departments for work-arounds.”
- Apple’s legal actions have “temporarily left competitors playing catch-up with their shoelaces tied.”
- Even prior to the lawsuit, some handset makers were cooling to Google because it released the Nexus One. Post-lawsuit, handset makers are wondering if Android is the best way to topple Apple.
- That’s leading to a renewed interest in partnering with Microsoft, and its new Windows Phone Series 7.