The seemingly never-ending patent war between Apple and Samsung came a little bit closer to a conclusion this week. But that doesn't mean either company is coming out as a winner.
After nearly two years of legal wrangling and billions of dollars worth of legal fees and fines, both companies are bending under pressure, and it looks like the the dispute might ultimately be settled by the consumer. In other words, despite Samsung's allegedly copying Apple's designs and Apple allegedly engaging in anti-competitive behavior by trying to ban its competitor's product, good old fashioned capitalism wins again.
The impasse in the patent war comes as each company suffered a setback in its quest for unrivaled dominance. Apple failed to win a permanent injunction against 26 Samsung phones that it said violated its software design patents. The judge sounded pretty reasonable when he said that the Samsung devices "contain a broad range of features, only a small fraction of which are covered by Apple's patents." At around the same time, Samsung backed down on its own request for injunctions on Apple products in the UK, France, Italy, Germany and the Netherlands. Why? They said that it was “in the interest of protecting consumer choice.” Samsung added, "We strongly believe it is better when companies compete fairly in the marketplace, rather than in court."
This pro-capitalist attitude would've been helpful about two years ago when Apple filed its first patent infringement lawsuit against Samsung. The dispute between the two companies quickly spiraled out of control, and by July of this year, over 50 lawsuits in ten different countries held the future of smartphone sales hostage. It's not just that certain models could be banned by the courts. Apple and Samsung both can always come up with new designs. But the cost of the patent war — literally billions of dollars worth of legal fees and fines — will inevitably trickle down to the consumer and could even slow innovation.
It shouldn't have to be like this. As many have pointed out since the Apple-Samsung nightmare started, the software patent system as we know it is pretty backwards. Technology companies do stand to gain from patents in the form of licensing fees and exclusive features. As The Economist points out, however, they stand to lose a lot more. "A study in 2008 found that American public companies' total profits from patents (excluding pharmaceuticals) in 1999 were about $4 billion," the magazine writes, "but that the associated litigation costs were $14 billion." This doesn't include the billions of dollars that these tech companies spend on acquiring patents in order to be better armed for inevitable lawsuits.
We'll have to wait and see what Apple and Samsung do next. The notion that they might finally let consumers decide the winner feels pretty optimistic, but you never know. However, it will take sweeping changes to patent laws in order to keep these kinds of spats from happening again.