How Apple Can Win its Patent War Against Samsung
Apple (NASDAQ: AAPL) is finding it increasingly difficult to keep its competitors from cloning the firm's best products. While the Apple/Samsung lawsuits are open to debate, there is no denying that some firms will do whatever they can to copy Apple.
Thus far, Apple has not sued either company for building knock-offs. Honda's (NYSE: HMC) John Mendel might know why.
"Design is really not patentable," Mendel, who serves as the Senior VP of Honda's American division, told Benzinga this week. "How you bend sheet metal… Because it's square and it has a screen or four doors or two doors or three doors, it's very difficult to patent design. What you hope to do is get a design that people are attracted to -- kind of a moth to a flame."
Apple has created a "moth to a flame" effect with the MacBook Air, which inspired Intel (NASDAQ: INTC) to push for lighter, thinner and faster Windows-based notebooks.
Consequently, the MacBook Air has also been cloned by a number of manufacturers. One of them comes from LG and is nearly identical to Apple's creation.
Mendel's comments might explain why Apple is not suing its iMac and MacBook competitors. Nonetheless, the company continues to go after smartphone manufacturers -- particularly Samsung -- for infringing on Apple's patents, trademarks and/or designs.
Going forward, there could be a way around this -- but it will not be easy. In order to keep its competitors for following Apple's lead, the Mac maker must build products and services that are too difficult to imitate.
According to John Krafcik, President and CEO of Hyundai Motor America, that's how his firm stays ahead of the competition. In discussing Hyundai's home and office test drive service (in which the company delivers new vehicles to potential customers for a test drive), Krafcik was not worried about the risk that competitors will follow suit with a similar program.
"They can't," he told Benzinga. "They wouldn't be able to handle it."
While analysts would argue that everything can be copied, that is not entirely true. iTunes is by far the largest and most successful online music store in the world. While there are many popular services that allow consumers to stream music, iTunes is the only massive outlet for purchasing albums and singles. No other online store can compare. Not even Google (NASDAQ: GOOG), which built a stellar App Store competitor now known as Google Play, has been able to build a competitive music store.
Amazon (NASDAQ: AMZN), Apple's other major competitor, knows a thing or two about selling books. However, its music store (which pales in comparison to iTunes) has not been nearly as successful.
Thus, analysts and investors are wrong when they assume that everything Apple produces can and will be copied successfully. It is very difficult to create something of that magnitude, however.
Apple is rarely able to produce a product or service that sweeps the industry and prevents competitors from cashing in. This may be why the company is so eager to take its smartphone competitors to court: because it knows that this is the area in which it is most vulnerable.
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