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An Inside Look at Apple's Role in the Patent Industry

In the seventh installment of its "iEconomy" series focused on Apple, The New York Times takes a look at patents, examining how and why Apple has wielded them in what seems to be a never-ending series of lawsuits between the company and its competitors.

The seven-page article offers an interesting glimpse into the patent process and traces Apple's aggressive efforts to a $100 million settlement paid by the company to Creative Technology over digital music players such as the iPod. As Apple worked toward launching the iPhone relatively soon after that 2006 settlement, Steve Jobs became committed to ensuring that Apple's innovations would be protected.
Privately, Mr. Jobs gathered his senior managers. While Apple had long been adept at filing patents, when it came to the new iPhone, “we’re going to patent it all,” he declared, according to a former executive who, like other former employees, requested anonymity because of confidentiality agreements.

“His attitude was that if someone at Apple can dream it up, then we should apply for a patent, because even if we never build it, it’s a defensive tool,” said Nancy R. Heinen, Apple’s general counsel until 2006.
The report describes how Apple's engineers were required to participate in monthly "invention disclosure sessions" in which they sat down with patent lawyers to discuss their efforts and determine whether any portions of their work would be patentable. The report also points to the massive costs involved in the patent industry, with Apple and Google now spending more on patent issues than on research and development.
In the smartphone industry alone, according to a Stanford University analysis, as much as $20 billion was spent on patent litigation and patent purchases in the last two years — an amount equal to eight Mars rover missions. Last year, for the first time, spending by Apple and Google on patent lawsuits and unusually big-dollar patent purchases exceeded spending on research and development of new products, according to public filings.
The New York Times shares several other anecdotes that help provide an overview of the patent landscape, including discussion of how Apple spent seven years shepherding what would become the "Siri patent" through numerous reviews before it was ultimately granted on the tenth try.

Another story centers on voice recognition company Vlingo, which was forced to sell itself to competitor Nuance after it incurred millions of dollars in legal bills trying to defend itself from six lawsuits filed by Nuance, even though Vlingo was victorious in the one trial that made it to a jury decision. During that time, Siri, which had yet to be acquired by Apple, switched its allegiance from Vlingo to Nuance, and Vlingo's fate was sealed.

Overall, the report provides a solid overview of some of the challenges facing the patent industry, where overworked patent examiners are tasked with quickly assessing the validity of numerous patent applications as teams of lawyers tweak and prod submissions until they can make their way through the system. Numerous proposals for revamping the patent system have been made, ranging from simply shortening the protection term of technology-related patents to tightening the criteria for patentability, but in the meantime technology companies will clearly continue to spend billions of dollars staking out and protecting their territory to the maximum extent possible.

Top Rated Comments

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26 months ago

Methinks you don't know what that term means.

Patent troll is a pejorative term used for a person or company who enforces patents against one or more alleged infringers in a manner considered aggressive or opportunistic with no intention to manufacture or market the patented invention.[1]


http://en.wikipedia.org/wiki/Patent_troll


Um, that's exactly what Steve Jobs told his employees to do, apparantly, as quoted in the OP: "His attitude was that if someone at Apple can dream it up, then we should apply for a patent, because even if we never build it, it's a defensive tool,"
Rating: 25 Votes
26 months ago
Like I've said before, if you're not demonstrably attempting to bring a patent to market after a certain number of years, that patent should just go public domain.
Rating: 24 Votes
26 months ago
while apple is becoming the biggest patent monster of them all
Rating: 23 Votes
26 months ago
The US patent system is completely broken. I like Mark Cuban's perspective of simply out performing the competition.
Rating: 15 Votes
26 months ago

while apple is becoming the biggest patent troll of them all


Methinks you don't know what that term means.

Patent troll is a pejorative term used for a person or company who enforces patents against one or more alleged infringers in a manner considered aggressive or opportunistic with no intention to manufacture or market the patented invention.[1]


http://en.wikipedia.org/wiki/Patent_troll
Rating: 9 Votes
26 months ago

You being Outperforming then another Samsung comes along....


How do you protect innovation?


We tend to forget that we compete in a world market and every locality has different rules.


I might be alone on this, but I think thats part of the problem. Apple's patent lawsuit with Samsung is completely ridiculous. Look at the patents Apple claims Samsung infringed on, I don't think Apple should have been given patents with such a broad description.
Rating: 8 Votes
26 months ago
The entire patent process has gotten out of hand for the tech and software industry. The idea that you can patent an idea and no one else can improve upon it seems wrong. Now I am not talking about patents that are required for industry interoperability, those are supposed to be covered by FRAND rules (though those seem to be pretty broad).

A look and feel shouldn't be something that doesn't change. You can make it better, add a new feature, and you release it. Someone else takes that idea and then improves it. Saying 'this is my idea' and you can't copy the look or feel just doesn't seem right. It would be like someone first brings out the word processor and no one else can use the idea to improve upon it.

Perhaps only give software patents only one year of protection after release before others can use the look and feel. It seems like many products are brought to market with "Patent Pending" anyway.
Rating: 7 Votes
26 months ago

Like I've said before, if you're not demonstrably attempting to bring a patent to market after a certain number of years, that patent should just go public domain.


This is exactly right. No defensive patents would solve a lot of problems in this system. Patents were supposed to be about protecting innovations coming to market NOT protecting the status quo. As is, those with the deepest pockets can leverage an every growing library of "we may do nothing with these" patents to squelch any smaller firms trying to actually bring something innovative to market. Defensive patents pinch innovation among the small, reserving innovation for the large, rich companies.

I can't blame Apple for playing the game by the rules (that actually cost them in that Creative patent scenario) but I do completely believe the game's rules should be changed. "No defensive patents" otherwise known as "use it or lose it" would be the first changed rule.

Another: if someone can innovate a medical cure from a patented treatment, the innovator who cures the problem gets half of the original patent. In short, we need cures much more than we need pill-a-day treatments. However, the latter has a forever cash stream while the former is one big blast of revenue and then nearly nothing. Think about how much one-a-day treatment revenue is made on- say- Polio, Smallpox or the Plague. "As is" the rules are such that even if a pharma actually found a cure, they are most incentivized to back it down to a treatment. I wonder how many cures might be laying in a safe somewhere because the treatment is so much more profitable. A simple rule change biased to cures over treatments and we'll get cures again. And before someone labels conspiracy theorist, note how much better all of our tools have become in the last 20-30 years. Now, how many cures of substance have come out in the last 20-30 years? With all the fantastic technology, DNA analysis, medical advances, etc, we can't find a cure for anything?

Another: software cannot be patented, only copyrighted. Else, eventually, you won't be able to code anything because a handful of companies will own all of the conceptual ways of doing anything. Software patents have always been dumb IMO.

There are several other needed rule changes but you get the idea.
Rating: 7 Votes
26 months ago


But the bigger problem is a LARGE company like Samsung and Google, who have no regard for patent laws, or intellectual property in general. They are supported by the tech teeny bops, who see no reason for any software patents at all. Samsung makes nice pieces of tech, but first they made Blackberry knockoffs, and then they made Apple knockoffs. And Google fan's talking point is that "Google was at work on Android two years before the iPhone came out!" (Yeah, but it looked like a Blackberry, see?) Or "The iPhone wasn't first! The Palm Pilot was just the same!" (And I have a bridge in Brooklyn to sell you.)


Samsung has far more patents than Apple does.

As for your history of Android - it's pretty inaccurate. But posted in this forum - that's not surprising given the amount of inaccurate information you're probably just spewing from "memory" vs fact.
Rating: 6 Votes
26 months ago

So give us what you think of the facts. If you were there, I'll take it seriously.

Regarding Samsung, one of the most damning pieces of evidence was the evolution of their phones over the years. The jury thought it was damning.

And i distinctly remember the prototype Android before the iPhone: it sure looked like a Blackberry. I guess that Eric was serving on the board, passing info to the Google board, and when Apple succeeded their iPhone project went live. And Eric stayed on the board.


You can mroogle all you want. I'm not going to waste my time (yet again) on someone who can't research for themselves vs relying on "fan" mentality.
Rating: 6 Votes

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