SAN JOSE, Calif. — It was the $1 billion question Saturday: What does Apple Inc.’s victory in an epic patent dispute over its fiercest rival mean for the U.S. smartphone industry?
Analysts from Wall Street to Hong Kong debated whether a jury’s decision that Samsung Electronics Co. ripped off Apple technology would help Apple corner the U.S. smartphone market over Android rivals or amount to one more step in a protracted legal battle over smartphone technology.
Many analysts said the decision could spell danger for competitors that, like Samsung, use Google Inc.’s Android operating system to power their cellphones.
“I am sure this is going to put a damper on Android’s growth,” said New York-based Isi Group analyst Brian Marshall. “It hurts the franchise.”
The Silicon Valley jury found that some of Samsung’s products illegally copied features and designs exclusive to Apple’s iPhone and iPad. The verdict was narrowly tailored to only Samsung, which sold more than 22 million smartphones and tablets that Apple claimed used its technology, including the “bounce-back” feature when a user scrolls to an end image, and the ability to zoom in with a tap of a finger.
But most other Apple competitors have used the Android system to produce similar technology, which could limit the features offered on all non-Apple phones, analysts said.
“The other makers are now scrambling” to find alternatives, said Rob Enderle, a technology analyst based in San Jose.
Seo Won-Seok, a Seoul-based analyst at Korea Investment, said the popular zooming and bounce-back functions that the jury said Samsung stole from Apple will be hard to replicate.
The companies could opt to pay Apple licensing fees for access to the technology or develop smarter technology to create similar features that don’t violate the patent — at a cost likely to be passed on to consumers.
Apple lawyers are planning to ask that the two dozen Samsung devices found to have infringed its patents be barred from the U.S. market. Most of those devices are “legacy” products with almost nonexistent new sales in the United States. Apple lawyers will also ask that the judge triple the damage award to $3 billion since the jury found Samsung “willfully” copied Apple’s patents.
A loss to the Android-based market would represent a big hit for Google as well. Google relies on Android devices to drive mobile traffic to its search engine, which in turn generates increased advertising revenue.
Samsung has vowed to appeal the verdict all the way to the U.S. Supreme Court, arguing that Apple’s patents for such “obvious” things as a rounded rectangle were wrongly granted. A Sept. 20 hearing is scheduled.
