Apple vs Samsung

by David Loft posted August 28th 2012

File Under Mobile

When the iphone was release, Phone manufacturers had three choices. Do nothing, copy or build something new.

Rim and Nokia chose to do nothing and continue as they were, now look at where there are, fractions of their once former selves.

Microsoft chose to build something new, they ditched Windows Mobile and the end result was Windows Phone. It's definitely new and refreshing, but it's also three years late.

Google and many of the OEM's who chose to employ Android chose to replicate Apple's success and I have to say at least with Samsung it was the right choice. It really was Samsung's shear size and manufacturing capabilities in combination with the good timing of an open source OS from Google that enabled them to quickly pump out smartphones that did everything Apple's did, but for a fraction of the cost.

A billion dollars from Samsung will not affect them much as they have made more than ten times that on the Galaxy S line. They have also moved away from directly replicating the look of Apple. The original Galaxy S was the biggest clone, but with each generation release, they have been clearly moving in their own direction. Their latest flagship devices, the Galaxy SIII, Galaxy Nexus and Galaxy Note, look nothing like an iPhone and have taken on their own brand identity.

Apple's success has been in part due to their economy of scale as a result of their ability to source parts in quantities beyond all but one player. This has enabled them to continue to produce quality products while also being able to launch them worldwide. Samsung is the only other company that can go toe to toe with Apple and as of late have been able to beat them to market with the latest in smartphone technology.

Samsung will not be hurt by this lawsuit or any other future lawsuits because they release so many devices that by the time a lawsuit about one device gets it's day in court they will have released a dozen more.

Unfortunately it's all the other players in the market that will get hurt by all these patent lawsuits. No one else has the economy of scale to compete on technology, price or quality and maintain enough margin to keep their business profitable in the face of patent litigation or massive licensing fees.

Patent litigation will definitely push Samsung and a few other of the bigger players to innovate but it will also keep out many small players from entering the market as it will be impossible to produce a phone without bumping into someones patents.

The end result of all this patent litigation will be the ever increasing dominance in market share by Samsung and Apple leaving their competition to struggle for scraps. At least until the next major leap forward is introduced much like the original iPhone and then the shake up starts all over again.

Source: The Verge


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