Thursday, 29 November 2012

Samsung in the copying wars again. This time they're in court against Ericsson. They only have to lose once.

Fresh after Apple, Samsung now has another legal battle on its hands, against Ericsson. The Swedish company is the worlds largest marker of telecoms equipment and mobile infrastructure, going against the world's largest maker of mobile phones and is suing for breach of 24 of its patents. Ericsson say they re-invest about 15% of revenues annually in R+D so patents are real important.

You think it's a tradition in Samsung to copy? I wonder.... Have a look at The Samsung Commercial at the top of this blog and then the classic Apple Steve Jobs Ad that follows it (btw, voiceover is Richard Dreyfuss). Tell me it's not a copy? Please?

Samsung is the world's largest maker of TV's and cellphones but substantially lost a very similar legal battle to Apple in the US although won elsewhere, notably in Japan. It was claimed that South Korean Samsung, merely copied Apple designs and sold them for less. Samsung ended up paying Apple 1 billion usd and with all sorts of restrictions, following damages from patents on their mobile devices.

That Apple battle is still going on and now they have another with a company as large as Ericsson.

But South Korea doesn't have a rip-off culture? Or am I wrong there?

Ericsson is looking to block the sale of Galaxy phones, TV's, Cameras and Blue ray devices, so serious it considers the matter. If they won, all Samsung phones could be pulled from shelves. It's also a little bit more interesting because Samsung did ask Ericsson to renew licences at a much lower rate than competitors pay and Samsung say that it tried to strike a fair deal but Ericsson said no.

However, ongoing court battles like this against Samsung, have to take the sheen away from the brand which to be fair, has begun to dominate the world from nowhere. Their Galaxy 3 phone has sold more than 30 million units since its launch in May. They outsell Apple Iphones by 4:1 but they need to behave better. In this case, nearly two years of negotiation took place before the venture into court. 

Of course too, large techy companies will always be faced with continual court skirmishes - it goes with the territory - but Samsung seem to get into scraps more than most and it's mainly about copyright infringement. 

Samsung only have to lose once. Sure, fines they can pay but removal of equipment from retailers shelves will devastate the company and possibly finish it. You should never gamble with something that has the potential to collapse your company.