Who are the Gainers & Losers After Apple’s Patent Win Over Samsung

Apple’s patent suit victory over Samsung has a domino effect in the highly competitive booming smartphone market, which will affect many players, some losing and some gaining.

The Losers

(A) The first and biggest loser is obviously the South Korean giant Samsung. Samsung’s reputation takes a hit worldwide as the company has been branded a ‘cheat’ by the trial verdict. In addition to the $1.05 billion compensation to Apple, its stock value will also be affected by a likely downward turn. The requirement to make design changes in the upcoming gadgets will also require heavy financial inputs.

(B) The second loser will be Google as the company uses the Android platform to push its search ads on the mobile platform. If manufacturers become risk averse and shy away from Android and seek other operating systems, Google’s reach as the native search engine on its mobile OS may be decreased by a substantial margin.

Android is the world’s most popular mobile operating system and has a huge marketplace with over 600,000 apps. Google will have to find alternatives to features like pinch-to-zoom, rubber band effect during scrolling and double tapping to zoom features on this platform, as these violate Apple’s patents.

Moreover, Android will suffer heavily if smartphone manufacturers become wary of Apple’s potential lawsuits against companies making Android-based phones.

(C ) The third loser will be the Smartphone manufacturers who use Google’s Android as the operating system of choice for their smartphones. They will be worried about litigation from Apple. Many may decide to hold off new launches till Apple makes its next move. They will be concerned that if Apple decides to file a case against them, they would end up paying billions like Samsung.

The other alternative will be to license the patents from Apple and pay a certain amount for each device sold. This will push the price of Android devices higher, thus hitting their profits.

The Gainers

(A) Of course, the biggest winner of the patent battle is Apple. This victory will once again propel Apple to be confident of asking licensing fee from Android phone manufacturers, which will help it boost profits. Moreover, if top end Samsung phones are banned by judge Lucy Koh in the coming weeks, Apple may even see slightly higher sales in the US market.

(B) There is a possibility of a gain of another kind for Samsung, though it is cost intensive. Now Samsung will have to reinvent some of the features that will ensure consistent user experience on its Galaxy range. This will provide Samsung the opportunity to show that it is not a copier, but can also innovate.

(C ) This verdict will help stimulate the development of mobile operating systems that have been sidelined by Android’s robust growth. OSes like Bada, MeeGo, Windows 8, Firefox OS etc are likely to get more attention from manufacturers who will be concerned about Apple’s patent violated by Google’s operating system. This will mean more options for the buyers, even though developing thousands of apps for each platform will take a lot of time.

(D) Nokia’s new flagship phones running on Windows 8 will give stiff competition to the South Korean company’s line-up. In case Samsung Galaxy phones are banned in the US, Nokia will get a new lease of life as its smartphones operate on Microsoft’s Windows Phone OS and thus will be unaffected by Apple’s pursuit of Android phone manufacturers.

(E) Microsoft will soon roll out the Windows Phone 8 mobile operating system and this verdict against Samsung may make mobile phone manufacturers worried about lawsuits from Apple may opt for this OS. If this happens, the company’s mobile OS will be invigorated and may emerge as a strong competitor to Android.

(F) Research In Motion has a healthy patent portfolio that will help any manufacturer take on Apple when it comes to new technologies. The value of the beleaguered company’s patent portfolio will get a boost from the trial’s verdict as manufacturers may consider buying the company in a bid to ward off litigation threats from Apple.

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