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Will Google lose out after Apple victory?

Apple's court win saw rival phone maker Samsung ordered to pay $1bn, but the key battle is with the Android software maker

Toby Green
Wednesday 29 August 2012 12:46 BST
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The new Nexus 7 - Google's first tablet - runs on the latest Android operating system
The new Nexus 7 - Google's first tablet - runs on the latest Android operating system (Getty Images)

Anyone visiting Google's Mountain View headquarters in California will come across an eclectic collection of statues. There, on a lawn, stands oversized models of various foodstuffs, including a gingerbread man, an éclair and an ice cream sandwich in the shape of a robot.

These are the search giant's monuments to Android, with each model representing a version of the mobile phone and tablet operating system, the most recent of which, Jelly Bean, was unveiled earlier this year.

Free for manufacturers to build their phones and tablets around, the Android system – launched in 2007 – has come to dominate the mobile world. Recent figures from the research firm IDC shows more than two-thirds of the smartphones shipped worldwide between April and June were based on Android, but recent events suggest life in the future may not be such a picnic for Google.

The decision last week by a nine-person jury in California to order Samsung to pay Apple $1.05bn (£663m) in damages has not just hit the South Korean technology giant. Samsung is the largest manufacturer of Android-based phones, and the ruling that its devices copied elements from the iPhone and the iPad has seen the attention switch to what it could mean for Google.

There's certainly no love lost between Apple and Android. Apple's co-founder Steve Jobs – who died last year aged 56 – told his biographer Walter Isaacson that he was "going to destroy Android" and that it was "a stolen product". Saying he was "willing to go thermonuclear war on this", he also said he would "spend my last dying breath if I need to, and I will spend every penny of Apple's $40 bn in the bank, to right this wrong".

Yet rather than deciding to tackle Google face-on, Apple has been battling with the manufacturers who are making devices based on Android. Samsung is one of a number of adversaries, with Apple also currently taking on HTC and Motorola in the courts.

With last week's ruling finding that Samsung infringed design as well as software patents, Google's response to the verdict has been fairly calm, saying most of the "claims don't relate to the core Android operating system". However, it added that the "mobile industry is moving fast and all players are building upon ideas that have been around for decades.

"We work with our partners to give consumers innovative and affordable products."

"The ruling marks an important victory for Apple against Android," said Ben Reitzes, an analyst with Barclays. "Competitors may now think twice about how they compete in smart mobility devices with the industry's clear innovator".

He added that if Apple "forces competitors to innovate more, it could take longer for competitive products to come to market, and make it more expensive to develop them."

One winner out of all this could well be Microsoft. Its Windows Phone platform lags well behind both Apple and Google's systems in popularity, but the Samsung ruling prompted claims phone makers could now turn to the operating system instead of Android. Bill Cox, marketing director for the Windows Phone division, was certainly pleased – he responded to the court's decision by tweeting: "Windows Phone is looking gooooood right now."

Enders Analysis' Benedict Evans warned the Samsung decision would create "ripples of uncertainty for Android manufacturers", adding that it makes them "take a second look at Windows Phone, which doesn't have these problems", although he said the likelihood of them switching was "a long-shot".

Pointing out Samsung's relatively large size in comparison to other Android handset makers, he argued that while a $1.05bn damages payment is "painful for Samsung, it would be fatal for any other Android manufacturer".

Mr Evans said the Samsung ruling "will cause some redesigns and some delays and shave some peoples' margins" for manufacturers using Android, although he added that not many consumers would be prompted into buying an iPhone instead because of the difference in price.

Google has not been sitting on its hands. Little more than a year ago it announced it was forking out a huge $12.5bn to snap up Motorola Mobility, the half of Motorola which made mobile phones.

Although this part of the business is by no means the handset giant it once was, the deal did give Google access to nearly 25,000 patents.

As a result, this allowed Google earlier this month, before the Samsung ruling had been made, to itself file a lawsuit against Apple claiming a number of features such as Siri – the iPhone's voice-recognition system –ripped off its patents. If Google was to come out on top, this could pave the way to a deal being struck with Apple.

Experts have also pointed out that many iPhone and iPad users use Google technology – such as the Gmail email app – on their device, suggesting Apple has a vested interest in ensuring relations between the two don't break down completely.

Nonetheless, after the Samsung victory, the fight between Apple and Google seems to have a way to go yet.

Software features: 'Rubber-band' effect

While Samsung was found to have infringed a number of Apple's design patents, it was also judged to have copied software features such as the "rubber-band" effect, where – when the user is scrolling – the screen bounces after the top or the bottom is reached.

Manufacturers which build mobile phones and tablets around Google's Android operating system are able to adjust it, but this feature was once built into Google's Android operating system while other effects which Apple claimed had been copied still remain.

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