It was bound to happen—Steve Jobs mentioned a while back that he wanted to go nuclear on Google’s Android. Android is the little idea that became huge. Shortly after everybody in the tech world realized how big the Apple iPhone was going to be and the profound changes that it would cause in the tech space, Google got together with some hardware manufacturers and other players and launched a free operating system rival to Apple’s IOS and the rest, as they say, is history. The latest market share figures for smartphone devices pegs the Android’s market share at eighty one percent. Eighty one percent! Can you imagine that? Nobody can imagine that two years ago, much less when Android launched. That is phenomenal!
Based on that growth trajectory, unless Apple does something, it will be relegated to a tiny bit player in the market. This tiny bit player might still be racking up a lot of money. Remember: people will pay two to four hundred dollars above and beyond this similar hardware just to have that cool looking Apple logo at the back of the device. Apple has a dedicated fan base that is why it will always make money but that is not the problem. The problem is market share determines who controls the direction of the technology. If Apple gets sidelined again and marginalized into being a tiny player with maybe eight and five percent market share, developers wouldn’t even bother making applications for the IOS. Why? It’s only five percent of the market. The real market would be the ninety five percent. Just ask the developers that got sidelined because Microsoft’s Windows system dominated the OS market. It looks like Apple is no longer taking this lying down. It already hit Samsung with lawsuits before with regards to its allegations that Samsung copied Apple’s design. Now, a consortion of hardware companies that include BlackBerry, Ericsson, Sony, Apple and Microsoft filed a huge lawsuit against manufacturers of Android devices. These are ZTE, Asus Tech, Huawei, LG, HTC and of course, the granddaddy of them all, Samsung.
The lawsuit is very interesting because it also targets Google indirectly by saying that it’s bread and butter Adwords ad platform violates a patent from 1998. It is beginning to look very serious and the legal paperwork does read at first glance like a scary message. The truth here is that many tech industry observers are saying that Apple is failing in the marketplace. The Android apps are picking up while Apple is looking like it’s going to be declining. Just look at who filed the lawsuit? It’s basically anybody who lost out to Google Android. Ericsson? They don’t even register. Sony? Not even a major player. Microsoft? A tiny player and a distant third. This lawsuit is really about Apple trying to figure out a way to stop the Google Android juggernaut.
Many critics are critical about this because they are saying that Apple cannot compete in the market place so it’s now it’s trying to compete in court, in other words, they are trying to get from a lawsuit what they cannot get through market mechanisms. They are saying that this is kind of unfair. It will really be very interesting to see how this patent war pans out. It’s all about patents acquired by Apple, Microsoft and others who went bankrupt. This patent litigation really reiterates why many people are saying that patent law should be reformed because a lot of companies take out patents not because they want to protect their intellectual property per se but they are going to use the patent protection to deflect their competition. There’s a lot of good policy arguments for and against this lawsuit. It’s definitely one that is worth observing.