Apple vs Samsung – A tale of two rivals

Apple vs Samsung – A tale of two rivals

For many years, Apple and Samsung have faced an almost unprecedented scale in business history, their legal war costing more than a billion dollars and spanning four continents. Starting with the super-secret project that created the iPhone and the Steve Jobs fever when Samsung – an Apple supplier – invented a surprisingly similar device, Kurt Eichenwald explores the company’s patent infringement history among other ruthless business tactics and Explain why Apple could win battles but still lose the war.

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It all started six years ago in 2010, when the iPhone maker warned Samsung that the tablets and smartphones of the Korean giant infringed Apple’s patents. The company did not sue immediately because Samsung was a “trusted partner” – Apple spent billions of dollars on screens, processors and other components of Samsung.

Apple had already gone after another technology giant, HTC, in the same year. Both were settled with a cross-license patent agreement in 2012.

It is no secret that between Samsung and Apple represents more than half of all phones sold in the world [1]

 

Patent wars

On August 4, 2010, amidst the hustle and bustle of downtown Seoul, a small group of Apple Inc. executives pushed through the revolving door into a blue 44-story glass tower, ready to shoot the first shot In what would become one of the bloodiest corporate wars in history. The clash was brewing since the spring when Samsung launched the Galaxy S, a new entry into the smartphone market. Apple had picked one of the first overseas and gave it to the iPhone team at its headquarters in Cupertino, California. The designers studied her with growing disbelief. The Galaxy S, they thought, was pure piracy. The overall look of the phone, the screen, the icons, even the box looked the same as the iPhone. Patented features such as “rubber bands”, in which a screen image bounces slightly when a user tries to move through the background, were identical. The same with “pinch to zoom”, which allows users to manipulate the size of the image by pressing the thumb and forefinger together on the screen. And so on.

No one can claim a total victory in the world wars of litigation. In South Korea, a court ruled that Apple had infringed two Samsung patents, while Samsung had violated one of Apple. In Tokyo, a court rejected an Apple patent claim and ordered it to pay Samsung’s court costs. In Germany, a court ordered a direct sales ban on the Galaxy Tab 10.1, also too closely resembled Apple’s iPad 2. In Britain, a court ruled in favor of Samsung, declaring that its tablets were “not as cool” as the iPad, and unlikely to confuse consumers. A California jury found that Samsung had violated Apple patents for the iPhone and iPad, awarding more than a billion dollars in damages—an amount that the judge later ruled had been miscalculated by the jury. In the debate over setting the damages, a Samsung lawyer aid they were not disputing that the company had indeed taken “some elements of Apple’s property.”

By August 2011, Apple and Samsung were litigating 19 ongoing cases in nine countries; by October, the legal disputes expanded to ten countries.[2][3] By July 2012, the two companies were still embroiled in more than 50 lawsuits around the globe, with billions of dollars in damages claimed between them. While Apple won a ruling in its favor in the U.S., Samsung won rulings in South Korea, Japan, and the UK. On June 4, 2013, Samsung won a limited ban from the U.S. International Trade Commission on sales of certain Apple products after the commission found Apple had violated a Samsung patent,[4] but this was vetoed by U.S. Trade Representative Michael Froman.

The Market Share of Apple and Samsung

As far as the market share is concerned, Apple and Samsung owns a majority of the smartphone market while others like Xiaomi, Motorola and others have to manage what is left. As for global sales, Samsung takes the lead probably because of the varieties of phones released per year as compared with iPhone. More so, Iphones are widely ostentatious in nature while Samsung offers phones for all people.

The revenues for Samsung and Iphone are directly related.

In 2015 , Apple dropped sales but ever since, it seems they have been on the verge of a rise again. The reason is probably due to increase in phone size.
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The profit Margin – Samsung vs Apple

Pull Quote – Apple captured over 90% of smartphone profits

Michael Walkley from Canaccord Genuity estimates that while Apple’s iPhone only accounted for approximately 17% of smartphone unit sales for the year since they are premium smartphones they generated an estimated 54% of the industry’s revenues. He estimates that Apple’s iPhone captured 91% of the smartphone industry profits in 2015 (vs. 80% in 2014) and that Samsung was the only other profitable smartphone company with 14%. Even though Samsung sells more smartphones than Apple Samsung’s average selling price (ASP) is an estimated $180 vs. Apple’s $691 in the December quarter which allows Apple to blow away the competition.

Source : http://www.forbes.com/sites/chuckjones/2016/02/13/apples-iphone-profits-will-weed-out-other-players/#cc6206513e59

apple-stat

Companies are built to make money and in this area, Apple are doing far better than Samsung. One reason that can account for this is because Apple products are far more expensive than Samsung devices

 

 

Conclusion

The Apple inc. Vs Samsung Corporation war seems like a battle that will never end but the truth is that the public and consumers have benefited immensely from the situation of things while the two companies continues to produce better mobile phones over the year. Personally I love the freedom of using Samsung while Apple is great also, I find it rigid. Security on Apple is so tight that a simple task like retrieving old messages or files could be tasky.

 

 

 

References

  1. Apple Inc. Statistics, 2015
  2. Albanesius, Chloe (September 14, 2011). “Every Place Samsung and Apple Are Suing Each Other”PC MagazineZiff Davis. Retrieved August 11, 2012.
  3. Jump up to:ab Pyett, Amy; Feast, Lincoln; Davies, Ed (October 27, 2011). “Australian court to fast-track Samsung appeal on tablet ban”Reuters. Sydney: Thomson Reuters. Retrieved August 11, 2012.
  4. “U.S. ITC says Apple infringes Samsung patent, bans some products”. Reuters. 2013-06-04.
  5. Samsung Jacdaw Research Analysis, 2015

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