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Analysts: Apple vs. HTC could be long, protracted battle

updated 12:25 pm EST, Wed March 3, 2010

Aimed at undermining rivals in multi-touch, UI

The Apple patent lawsuit filed against HTC could take a long time to resolve, analysts argue. Needham's Charlie Wolf suggests that it could be a "long and bloody battle," in part because Apple has surrounded the iPhone with a "patent moat" meant to be difficult or impossible to cross. "Apple invested heavily and imaginatively in designing a unique, disruptive smartphone," adds Wolf. "In our view, the company has every right to protect the iPhone's unique features."

Kaufman analyst Shaw Wu remarks that the lawsuit could take "years," although Apple has millions to spend on the prospect if it wants to enforce its will. The eventual outcome is predicted to be an out-of-court settlement, in which HTC will be forced to remove features from its phones and/or pay licensing fees to Apple. HTC and other companies will have to work on alternatives, says Wu.

Both analysts point out that the lawsuit implicates other phone makers and designers, such as Nokia, Motorola, LG, Samsung and Google. Wu adds that Apple is likely motivated by the recent arrival of multi-touch on Google and HTC phones, which eliminates one of the reasons for buyers to prefer an iPhone. The HTC lawsuit may ultimately represent both a direct and a proxy conflict.

Risks of the lawsuit are said to include a negative affect on Apple shares, although dips could represent a buying opportunity for investors. Wolf observes that while Apple should have a "better than a 50-50 chance" to win its case, iPhone sales could start to slip in 2011 and subsequent years if accusations are defeated. Neither analyst has altered their financial forecasts.



By Electronista Staff
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Comments

  1. appleuzr

    Fresh-Faced Recruit

    Joined: Aug 2006

    +4

    comment title

    Apple is filing this lawsuit knowing it's going to win. They hold the patents and know what is going to hold up in court and what to let slide. Google and HTC have saturated the market in a short amount of time with dozens of cheap iPhone knock offs. Trying to fight this will only cost HTC more in the end. Apple will spend millions defending their patents and rightfully make HTC and others pay for the defense efforts.

    I would like to see HTC die a slow and painful death.

  1. MacMan2000

    Fresh-Faced Recruit

    Joined: Aug 2008

    +1

    Ok just a thought

    i know this is a bit off topic but a thought arose while reading this article.... We all know that apple lost in court vs ms back in the day on the OS lawsuit. But in the last 2 years apple has been winning suits that pertain to thier intellectual property.. thus making the OS intellectual property that may not be hacked, just wondering how the courts would rule in this case today

  1. testudo

    Forum Regular

    Joined: Aug 2001

    -2

    right....

    Apple is filing this lawsuit knowing it's going to win.

    Sorry, but no one ever knows they are 'going to win' when they file a lawsuit. OJ should have taught you that. And all you need is one piece of prior art and 'poof', up goes the patent.

  1. rtamesis

    Dedicated MacNNer

    Joined: Jan 2000

    +4

    $40 billion goes a long way

    Apple can turn HTC into ground meat in the courts; they have more than just millions to spend on legal and court fees. Can HTC last that long before they decide it's in their best financial interest to avoid a costly battle in the courts?

  1. driven

    Addicted to MacNN

    Joined: May 2001

    +3

    OS lawsuit?

    Apple didn't "lose in court" on the OS lawsuit. They settled out of court for a huge sum of money after Jobs returned to Apple. (At the time they were on the balls of their a**.) Seems to be they settled and got cash early. I was a Windows/OS2 - anti-mac guy back then and even I knew that Apple had a damn good case.

  1. ff11

    Fresh-Faced Recruit

    Joined: Apr 2004

    +2

    re: $40 billion goes a long way

    It does, but that is not a good thing. I am not comforted by the fact that the depth of your pockets is the primary factor in deciding who wins and who loses such a case.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    +2

    Re: OS lawsuit

    Apple didn't "lose in court" on the OS lawsuit. They settled out of court for a huge sum of money after Jobs returned to Apple.

    Don't know what internet site you read, but that's completely wrong. They lost in court before Jobs even got back to Apple.

    (At the time they were on the balls of their a**.) Seems to be they settled and got cash early. I was a Windows/OS2 - anti-mac guy back then and even I knew that Apple had a damn good case.

    The only case Apple was going to win was on Quicktime. That they settled with MS by selling stock to MS, getting them to agree to produce office, and in return MS got to use quicktime patents. The Office part was critical in making sure the beleaguered Mac OS was still seen as at least a little bit relevant (being that Apple had spent over 5 years trying to make a new OS, and even after they bought Next, it still took them another 4+ years).

  1. ggirton

    Fresh-Faced Recruit

    Joined: Nov 1999

    -3

    Nexus One rules!

    So there!

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