The Apple and Samsung battle continues to rumble, and less than a week after a proposed ban on the sale of iPhones and iPads was overturned, another ruling has -- at least for the time being -- gone Apple's way. The US ITC has upheld a previous ruling dating back to 2011 that found Samsung has infringed various Apple patents, potentially leading to a US ban on various devices from the South Korean company.
The ruling found that Samsung had violated two patents relating to Apple's iPhone. The first patent (often referred to as the "Steve Jobs patent") relates to the use of a touchscreen interface as means of interacting with a device using one or more fingers. The second patent relates to the design of an audio socket that can determine the type of microphone or headset that has been plugged into it.
In a letter to the International Trade Commission chairman, the Honorable Irving A Williamson, the Obama administration vetoes an earlier ITC ruling that was due to block the sale of a number of Apple products. The original ruling came in June and was to prevent the sale of various products including certain models of the iPhone 4 and the iPad 2.
The letter from Ambassador Michael Froman explains that having reviewed the information surrounding the patent dispute between Apple and Samsung, he had decided to "disapprove the USITC's determination to issue an exclusion order and cease and desist order". Under section 337 of the Tariff Act of 1930 the President is obliged to evaluate decisions made by the Commission during a 60-day review period, and in this instance the authority was passed to the USTR.
You will reads lots of dribble today about Samsung first quarter phone gains compared to Apple. Most will ignore something fundamental to the numbers: What they represent. IDC and Strategy Analytics separately put out data, for shipments, which mean handsets going to carriers, dealers and other sellers. That's very different from sales to businesses and consumers, Gartner's measure and the more accurate one (that data isn't ready yet).
For few quarters is the difference between shipments and sales likely to be so pronounced, actually even more so in Q2. Apple comes off its second full quarter of iPhone 5 sales and global distribution, and so shipments into the channel, nearly complete. Meanwhile, Samsung ramps up for Galaxy S4's launch, while achieving full global availability for the S III. Second quarter is the more likely bloodbath for Apple, but actual sales will foreshadow much. Still, shipments hint something now, and iPhone faces serious challenges.
What's wrong with Samsung? That's the question I asked in newsroom group chat today after seeing specs for Galaxy Note 8.0. Screen resolution diminishes the otherwise noteworthy feature list. Sorry, but 1280 by 800 is inadequate -- little more than matchup to Apple's iPad mini, which is similar size. For a company that makes such great-looking displays, lower-res is an endemic problem across Samsung's entire tablet line.
I really expected more from Galaxy Note 8.0, which as the same suggests has an 8-inch screen; iPad mini is 7.9. Samsung unveiled the tablet in February, and I wrote the news story. But in the rush of Mobile World Congress news didn't consider screen resolution, in part on possibility specs would change. The electronics giant has done it before, announcing one thing but shipping something slightly different months later.
Only T-Mobile can save iPhone now. Apple's U.S. market share, as measured by smartphone operating system, retreated in February, according to data Kantar Worldpanel ComTech released today. With the iPhone 5 initial release sales glow gone, and a rapidly saturating market for a product feature set now three models old, share isn't sustainable. Meanwhile, Android gains -- as does Windows Phone.
iPhone share, based on sales, fell to 43.5 percent for the three months ended in February. That's down from 45.9 percent in January and from 47 percent a year earlier. By comparison Android is up -- to 51.2 percent from 49.4 percent sequentially and 45.4 percent annually. By the same reckoning, Windows Phone rose to 4.1 percent from 3.2 percent and 2.7 percent share.
Early this evening, during a New York soiree, Samsung launched the Galaxy S IV smartphone. The venue is atypical. The South Korean electronics giant usually starts from home, offering new smartphones globally before reaching the United States. Now, in a dramatic change, a flagship Galaxy phone lands on Apple's home turf first.
The companies are in a struggle for smartphone supremacy, with Samsung leading in most countries. With one glaring exception: The United States. Today's venue clearly marks the South Korean manufacturer's intentions to take the share lead from its American rival.
One measure of any brand's success is how much people talk about it. By that reckoning, Apple's star is fallen, while Samsung's rises. Consider the amount of rumors the past month or so about Galaxy S IV, which launches this week, and contrast that against near silence about anything Apple. Turn back the clock a year and you'll see modest buzz about the S3 but ongoing Apple rumors that stole the thunder from the Consumer Electronics Show, Mobile World Congress and just about every single new mobile product launch. (Yet this year, Apple efforts to overshadow CES failed.)
Then there was the noise, noise, noise from Apple's patent lawsuit against Samsung, which hundreds of bloggers and journalists used to repeatedly label the South Korean company the world's worst worrisome copycat. In the end Samsung's image is no worse for wear, while Apple rumors wear thin. The most prominent recent one is about a watch. For the wrist? What Citigroup analyst Oliver Chen calls a $6 billion business for Apple. Let me make that clear, because shorthand lacks the impact: $6,000,000,000! That's more than iPod generated in fiscal 2012 ($5.6 billion). Yeah, right.
In the highly saturated U.S. smartphone market, Apple's dominance grew, while iPhone nipped upwards towards Android, for the three months ended in January, according to comScore. The analyst firm, unlike most of its competitors, measures actual subscriber share rather than number of units shipped. Like Gartner's counting actual sales, comScore gives a clearer view of real-world dynamics.
During iPhone 5's first full three months of sales, Apple's share reached 37.8 percent -- up from 36.3 percent in December and 34.3 percent in October. By comparison, second-place Samsung nudged up to 21.4 percent share, from 21 percent sequentially and 19.5 percent for the same three months. HTC, Motorola and LG followed, with respective shares of 9.7 percent, 8.6 percent and 7 percent. All three lost share from December, with LG up ever-so slightly from October. Motorola's loses strongly suggest that at Verizon, carrier with the highly-visible Droid line of smartphones, subscribers shift allegiance to other brands. Good thing Moto has a new evangelist.
Apple's patent case against Samsung took an unexpected turn today. Judge Lucy Koh cut the damages, citing jury errors, removing some devices previously found to infringe the fruit-logo company's patents. Jurors had awarded about $1.05 billion in damages, which now are just $600 million (rounded up slightly). The South Korean electronics giant isn't off the hook by any means. More than a dozen devices remain infringers.
Judge Koh's order is a blow to Apple, but not one that invalidates any real part of its patent victory. The judge found that the jury had inappropriately calculated damages for some products, based in part on their acceptance of arguments made by Apple expert witness Terry Musika.
Samsung might have received a $1.05 billion bloody nose in its battle against Apple last year, but the South Korean giant is coming back fighting, by launching the next version of its flagship smartphone on US soil next month. The first such launch in three years.
Confirmed today at the Mobile World Congress in Barcelona, and in a tweet, Samsung will be unveiling the Galaxy S IV in New York as part of the Samsung Unpacked event on March 14.
Late February means another Mobile World Congress, and the rush to make big, splashy product announcements before the show starts. Samsung jumped in early today, by announcing an 8-inch tablet with stylus -- Galaxy Note 8.0. The slate is about the same size as Apple's iPad, with comparable screen resolution, but features the S Pen and supporting software. Why just touch and type when you can draw, too?
Samsung's slate joins the Galaxy Note II smartphone and 10-inch tablet, with stylus being the compelling feature that market leader Apple doesn't offer on any iOS device. Like the recent update for its siblings, Galaxy Note 8.0 comes with a split-screen, multi-window function. The tablet runs Android 4.1.2 customized with TouchWiz UI.
Bloggers the globe over report today -- and you can hear the snickering -- that Apple's flagship handset outsold Samsung's during fourth quarter. That's because Strategy Analytics director Neil Mawston told them so and they didn't really look carefully at the data: "Apple’s iPhone 5 overtook Samsung’s Galaxy S3 to become the world’s best-selling smartphone model for the first time ever in the fourth quarter of 2012".
Tsk. Tsk. Strategy Analytics mixes "bestselling" with "shipments". They are not the same thing. Shipments refer to units going into the channel (carriers and dealers), while sales refer to product purchased by users (businesses and consumers). Only Gartner measures actual phone sales, so why does Mawston use bestselling in one sentence referring to shipments in another?
"We're No. 3!" will be BlackBerry's and Microsoft's rallying cry this year. Android and iOS so dominate the smartphone market, the best -- and quite honestly dismal -- hope is third; distant at that. Combined, based on actual phone sales, Android and iOS had 90.1 percent share during fourth quarter, up from 74.9 percent a year earlier, according to Gartner. BlackBerry and Windows Phone are neck-and-neck, with lowly 3.5 percent and 3 percent standings, respectively.
Upstarts want third place, too. Anshul Gupta, Gartner principal research analyst, explains: "2013 will be the year of the rise of the third ecosystem as the battle between the new BlackBerry10 and Widows Phone intensifies. As carriers and vendors feel the pressure of the strong Android’s growth, alternative operating systems such as Tizen, Firefox, Ubuntu and Jolla will try and carve out an opportunity by positioning themselves as profitable alternatives".
Americans love their iPhones, finally enough to topple Samsung's long-time leadership. During fourth quarter, Apple nudged ahead of the South Korean electronics giant, with 34 percent share, based on shipments, according to Strategy Analytics. To be clear, the numbers are for all mobiles, not just smartphones. The distinction is important for several reasons. The American company only ships smartphones, for which demand rages. Related: Overall phone shipments fell for the year.
"Apple has become the number one mobile phone vendor by volume in the United States for the first time ever", Neil Mawston, Strategy Analytics research director, says. "Samsung had been the number one mobile phone vendor in the U.S. since 2008, and it will surely be keen to recapture that title in 2013 by launching improved new models such as the rumored Galaxy S4".
On 24 August 2012, after a thirteen day trial and three full days of deliberation, a California jury found Samsung guilty of infringing on several Apple patents and awarded the American company $1.05 billion in damages. The jury also found that Samsung had willfully stolen design elements from Apple, a damning finding which could have seen the amount of damages significantly increased.
Fortunately for Samsung, following post-trial hearings held over the past few months, US District Court Judge Lucy Koh last night issued a ruling overturning the jury’s willful infringement finding, a move which prevents Apple from being able to seek additional damages.