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Apple v. Samsung: The Trial and the Tribulations

Apple v. Samsung: The Trial and the Tribulations

A California courtroom became the center of Apple's long-running patent battle with Samsung as the two companies hashed out their grievances in open court. Controversy quickly arose when Samsung fed evidence to the media after it had been rejected by the judge. Meanwhile, the FCC laid down the law on tethering, Facebook value faltered, and Microsoft put Hotmail under the knife.

Samsung and Apple have been battling it out in courtrooms all over the world for months, if not years, with the worldwide conflict becoming kind of a dull hum in the background. This motion goes that way, that one goes this way, lawyers keep lawyering, whatever.

But what's going on in California this week is supposed to be the case that's actually exciting, because it's come to the point of a real trial. Jurors, gavels, dramatic pointing, Dick Wolf, everything.

Alleged patent violation is, of course, what's at stake here, with Apple accusing Samsung of ripping off its iPhone when it designed all sorts of characteristics of its own handsets. Samsung's denying that, and in addition, it claims Apple's actually the real infringer -- the iPhone, Samsung says, violates various wireless transmission patents it holds.

Apple's attorneys started out by portraying Samsung as a creatively impoverished firm that glommed onto the iPhone's design from the minute it first emerged in 2007. They told jurors to look at smartphones from before that year -- small screens, a million and a half keys on tiny little keypads. Then look at designs from after -- black touchscreen rectangles, just like the iPhone.

But Samsung countered that Apple's design patents aren't unique and shouldn't have been granted in the first place. Just because the iPhone was a commercial success doesn't necessarily mean it was particularly innovative. Making money doesn't mean you invented something new.

However, attorneys not involved in the case have commented that might not be a great argument for Samsung to rely on. Sometimes commercial success and large public demand can be used, at least in a secondary way, to argue patentability.

Even before the trial began began, Samsung had a difficult time with this particular case. The presiding judge, Lucy Koh, halted sales on certain Samsung products until the matter is settled. She also denied Samsung the chance to show the jury evidence the company claims would clear it of any suspicion of patent infringement, telling lawyers they tried to enter it too late in the process.

So instead, Samsung handed that evidence over to the media. It concerns a product called the "F700," a device that looks kinda-sorta like an iPhone and was under development by Samsung prior to the launch of the iPhone.

Perhaps Samsung was trying to win the hearts and minds of the public at large by tossing that evidence over the wall after the judge rejected it. But the real job in front of its attorneys is to win the hearts and minds of the people in the jury box. Or perhaps that really is their plan -- Apple seems to think so. The jury's not supposed to read media accounts of the case until it's over, but there's always a chance some of them might anyway. Apple's already accused Samsung of trying to corrupt the jury.


Listen to the podcast (13:37 minutes).

Thou Shalt Tether

Pretend, if necessary, that you have a smartphone. You pay a certain amount of money each month to use a certain amount of data on that phone. Maybe it's an unlimited amount, maybe it's limited, but it's clearly spelled out in your contract that the carrier will pump this much data to you as long as you keep pumping this much money to it.

So why should it cost more to tether another device to your smartphone? That's when you share the cellular data signal your phone's getting with another gadget, like a laptop or a tablet. Most carriers will charge you extra -- something like $20 per month -- for the right to share the data you're paying for anyway.

OK, maybe it makes sense from the carrier's viewpoint if the customer's on a truly unlimited plan. It's probably a lot easier to suck down massive amounts of data on a notebook than on a phone. Wireless carriers probably want to avoid being anyone's 150-GB-per-month media mule.

But they still charge extra for tethering on all those limited plans they've been pushing too. That won't be the case for long, though, at least as far as Verizon is concerned.

The U.S. FCC has compelled Verizon to allow its customers -- Android users, anyway -- to download and use apps that provide tethering capabilities without extra charge. That's the result of an investigation the commission kicked off following reports that Verizon was pressuring Google to block those kinds of applications from the Android Market.

Attempting to block those apps would constitute a violation of the rules Verizon agreed to when it purchased rights to a large block of wireless spectrum recently. Using that chunk of airwaves means letting all lawful applications run free without intervention, and that includes tethering apps.

Verizon has agreed to tell Google not to block those apps anymore, as well as cut the feds a check for $1.25 million.

If you're a Verizon customer still clinging to an old-school unlimited plan, don't get any big ideas about constantly streaming Netflix to your TV via your phone's data signal. Verizon insists that the terms of its contracts state that unlimited customers still have to pay for tethering. Of course Verizon and other carriers are shoving customers as hard as they can into limited, tiered plans anyway, so, you know ... hint-hint.

Also keep in mind that for now, this affects a sub-subset of customers -- one network, one platform, and only limited-plan users. Apple's iPhones are capable of tethering too, and the iOS App Store has in the past offered a couple of apps that allowed no-extra-charge tethering. Those were pulled very quickly, though. Maybe Apple will reconsider in light of this development, at least for Verizon iPhone users.

As for other networks, they did not buy the same block of airwaves, so they didn't sign up for the same terms and conditions that Verizon did. But given what the FCC's done here, it may well decide later to try and hold other carriers to the same rules for the sake of leveling the playing field.

And it might even find that other carriers are perfectly willing to oblige. Offering free tethering may prove to be a competitive advantage for Verizon, especially if those who partake are on tiered plans. Even if some of them end up using it for digital keg stands, well, Verizon can just stick them with a nice, fat overage bill at the end of the month.

Social Hostility

Facebook arrived on Wall Street last May under a cloud. The IPO was botched, underhanded dealings were alleged, and the company and its early investors paid a huge price as share value sank like a stone and never managed to work itself out of the funk.

But just because FB shares were born under a bad sign doesn't necessarily mean the stock is a permanent loser, right? The IPO was a bad scene, and sometimes a catastrophically pooped party just puts Wall Street in a sour mood for a few months, regardless of what else the company accomplishes after that initial slip-up. So maybe Facebook is worth more than some embittered investors would have you believe.

Or maybe not. Facebook issued its first quarterly financial report as a public company recently, and the numbers weren't encouraging. Revenue was a little over $1 billion, but that wasn't enough to post a profit for the social network. It reported a loss of $157 million.

There were a few spots of sunshine. Revenue was up 32 percent. But for some analysts, that's not nearly good enough -- they want to see 150 percent revenue growth year over year, and that's not the pace Facebook is running.

Of course that revenue comes from advertising, and in that regard, critics say Facebook has become downright boring. Social is a completely different medium for online advertising, and judging by the discussions going on during its pre-IPO road show, Facebook is highly aware of that. But since its public offering, the company hasn't seemed to do much in regard to whipping up excitement and offering advertisers new and innovative angles through which the shuck their wares.

The juiciest target is mobile -- well over half of Facebook's nearly 1 billion users are mobile users to some degree. They're accessing the network through smartphones and tablets while they're on the go, and the fact that they're running around in the outside world rather than parked at a desk at home or at work is a wide-open opportunity for new ideas about how to waggle products and offers in front of their faces.

But many investors say they don't see Facebook coming up with much of a mobile ad strategy. Some say they're being prudently cautious and deliberate about it, but that doesn't really sound like it describes Facebook's general personality -- at least not the personality it had before its IPO. Others say they're just being dull.

The latter opinion seemed to win the day. Directly after the earnings were reported, investors punished Facebook by quickly driving its price down to a new low.

Pandora's Dropbox

Dropbox is the latest online service to fall victim to a mass security breach, but this time it doesn't appear to be the direct fault of a technical shortcoming -- no unsalted passwords (LinkedIn!) or SQL injections (Yahoo!) here.

Nope, this time it seems that some other website's slip-up led to the Dropbox disaster, though that doesn't mean the company itself is innocent.

When a website is breached and attackers gain access to a big list of usernames and passwords, it imperils more than just the user accounts on that one site. Lots of people use the same combination of email and password at nearly every site and online utility they use -- Netflix, iTunes, bank accounts, social networks, everything. Get a long list of emails and passwords from one site, and you'll probably find your way into a lot of private accounts all over the Web if you keep trying those logins in enough places.

Apparently hackers obtained such a list of emails and passwords somewhere and started trying some of them out on Dropbox. That's an interesting target. It's not a place to go for a direct payout, like a banking site. But you could find some very sensitive and private and embarrassing information on all sorts of people. It's like looking around under the floorboards of someone's closet.

It seems that one of the accounts those intruders tried belonged to a Dropbox employee. And that employee happened to have stored a project document that included a list of Dropbox users' email addresses. It doesn't appear that more passwords were exposed, just email addresses. But that was enough to set off a big wave of spam directed at those Dropbox users.

Dropbox has responded to the incident by looking into upgrading its security to a two-factor ID system. Even so, on a technical level, it doesn't appear that Dropbox dropped the ball. Nobody forgot to salt anything, no SQL was injected anywhere. The intruders simply knew peoples' passwords, thanks to a breach at a totally different site.

On a policy level, though, Dropbox has been faulted for playing fast and loose with user information. Those email addresses weren't being stored under best security practices. They were stored in the locker of an employee who, instead of using a unique login for that extra-special data, went around using the very same login info on other sites all over the Web.

Hotmail Warmed Over

Hotmail has for years lingered in a corner of Microsoft's closet. It wasn't forgotten and neglected, exactly, but it was certainly not a showcase product that the company paraded about and constantly buffed and sanded to maintain a cutting-edge sheen.

Nope, it was just Hotmail. It did enough to keep from looking like a leftover from 2002, but it never seemed to capture the brand cachet of upstarts like Gmail.

So in order to give Hotmail the facelift it needed to gain some heat in the world of email, Microsoft didn't just change its face -- it also latched onto the company's very popular email client and changed its name. Hotmail is now "Outlook.com."

It's much more than just a name change, of course. Microsoft has created an email system that toes the company's new aesthetic line alongside Windows Phone and Windows 8, touting the new and bold-colored Metro look. (But you can't say that word anymore.)

Beyond the skin-deep changes, Outlook.com has a load of new features as well. It's built with direct links to Twitter, Facebook, LinkedIn -- even Google. Skype, which is owned by Microsoft, is on the way.

Outlook.com is also hooked into the online versions of Word, PowerPoint, Excel and OneNote, positioning it as a direct competitor to Google's online suite, which includes comparable products in Gmail and Google Docs.

Users should be able to plug Outlook.com into their mobile devices easily -- it's built to work smoothly with Windows Phones, iPhones, Androids and BlackBerries.

Changing your email address is rarely anyone's idea of a good time, but judging from early reactions, Outlook.com may well convince a significant number of people to give it a go.




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