Edward J. Black: In the Trenches of the Smartphone Patent War

The beginning of August is shaping up to feature an important series of engagements in the smartphone patent war between Apple and Samsung. On Thursday, an obscure government agency, the U.S. International Trade Commission, is set to issue a final decision on whether to ban Samsung products for infringing on a number of Apple's patents, including the notorious "rounded rectangle" patent. The next day, the Obama administration faces a deadline to decide whether it will intervene on behalf of Apple and overturn Samsung's legal victory at the ITC against Apple for infringing some of its core patents.

Unlike the "thermonuclear war" promised by Apple's former chief executive Steve Jobs, the patent conflict has devolved into a WWI-style war of attrition with both sides expending massive amounts of man-hours and treasure with few tactical gains to show for their troubles. Apple and Samsung have seen legal victories quickly neutralized by legal defeats as well as the speed of technological advancement.

The current state of the patent system helps explain this stalemate. An explosion of high-tech patents, many of questionable validity, coupled with the increased functionality built into the modern smartphone has led to a situation where the sheer number of patents in the space is unmanageable. With more than 250,000 patents in play in the smartphone ecosystem, it is virtually impossible for either company to achieve a decisive victory. And for good reason. Neither Samsung nor Apple is entitled to a complete victory, as both have played an important role in developing the underlying technology on which a modern smartphone relies.

In the long run, the Administration's efforts to increase standards at the Patent Office combined with legislation currently winding its way through Congress will help minimize some of these problems. In the short run, unfortunately, these efforts will do little to settle the costly dispute between the world's two biggest smartphone manufacturers.

Despite the opinion on both sides that their patent portfolio is more fundamentally important than their opponent's, this war will drag on until both sides agree to a full settlement and a broad patent cross-license; a scenario that Samsung has long supported, but one which ITC documents show Apple has refused.

In spite of Apple's near-religious belief that it was "ripped off," it has no more rights to own the smartphone market than any other company, least of all Samsung, which helped pioneer the underlying hardware on which Apple's iOS runs. And smartphone consumers the world over have the right to a competitive ecosystem. Market-driven competition is better for economic growth than choosing winners and losers through political and legal maneuvering. A settlement that results in Apple and Samsung engineers designing products instead of courtroom exhibits is better for all involved.

Currently, the Obama administration is weighing whether to overturn Samsung's recent patent victory over Apple at the International Trade Commission. Given that a presidential veto overturning an ITC order is extremely rare -- the last time it happened was over 25 years ago -- and that Apple has its own controversial patent infringement case against Samsung scheduled to be decided this week, overturning Samsung's legal win would smack of overt protectionism. Furthermore, given recent reports indicating that Apple is stalling in global patent settlement talks with Samsung, any political intervention will likely only prolong negotiated patent peace.

Just as the reality of endless trench warfare supplanted rosy predictions of victory in WWI, so too has Steve Jobs' grand illusion of a sweeping patent victory dissolved into a self-inflicted quagmire. Apple was at its best when it was competing on the merits of its products. Whatever the outcome of this week's legal squabbles, the best scenario for all would be a negotiated settlement that brings back real competition between two technology heavyweights. After all, both Samsung and Apple have the cash reserves and the legal firepower to perpetually bring patent suits. Using political influence to tilt the battlefield to favor one side or the other will merely perpetuate a costly war and lead to more collateral damage to consumers and innovation.

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