updated 03:35 am EDT, Mon August 6, 2012
Shown documents of Samsung studying Apple products
Apple’s fourth witness in the California-based Apple vs. Samsung trial was a Samsung employee, Samsung’s US Chief Strategy Officer Justin Denison, who was questioned about some Samsung documents as well as a deposition he gave in 2011. Apple’s attorneys tried, with mixed success, to use Denison to paint Samsung as openly copying Apple, and at two points got him to admit he could not stand by some of his earlier testimony.
Denison was on the stand representing three branches of the South Korean electronics giant: the parent company Samsung Electronics Corporation (SEC), Samsung Electronics America (SEA) and Samsung Telecommunications America (STA). After clarifying the three branches, Apple counsel William Lee asked Denison if he was under an obligation to take an instruction that came from the head offices of those divisions, or the parent company. Denison answered that communications were usually a “conversation” that involved a lot of back-and-forth but could be interpreted as directives.
Apple’s attorney asked Denison a series of questions about a deposition given in 2011 on the topic of Samsung copying from Apple. In the video deposition, Denison said that he talked to Samsung designers (some of which spoke Korean and thus were interpreted) and that they told him they hand not considered, studied, drawn or copied anything from Apple’s product designs. The Apple attorney went out of his way to add that in the context of these conversations, benchmarking should be considered different from copying, a point to which Denison agreed.
Following the playing of the deposition in which Denison claimed Samsung didn’t copy anything, Lee asked Denison if he still stood by that testimony as it related to the products contested in this case. Denison, over the objection of Samsung’s lawyers, said no, but then waffled on the answer a bit. Samsung’s request for a sidebar with the judge at that point was denied.
Apple’s attorney Lee then introduced an internal Samsung presentation called “Beat Apple Response” which was dated March 25, 2011 -- the same day the iPad 2 was introduced. Denison said that he created the presentation at the direction of Samsung’s CEO, Bill Choi. Included in the presentation are notes from another presentation Samsung gave in November 2010 called “Why [Samsung] should care about Apple.” Lee points out another section of the presentation, which dealt with strategy to compete against the iPhone at the time and had a “Recent Apple Analysis projects” page.
Lee also showed portions of a later (2012) Denison presentation entitled “Three Horse Race Becoming a Two-Horse Race between Apple and Samsung” to establish that in fact Samsung had been carefully studying Apple, in contradiction to Denison’s deposition testimony. He was shown another presentation called “Relative Evaluation Report on [Samsung’s Galaxy smartphone, known internally as S1] and iPhone” that was dated March 2, 2010. The report showed a comparison of the iPhone’s ability to zoom in on web items with a double-tap and recommended that the Galaxy’s double-tap zoom needed to be improved.
Other pages of the same presentation showed direct comparison of the iPhone and the Galaxy phone in a number of areas, including the UI and menu icons, each with directions for improvement to the Samsung phone. Denison was again asked at this point if he stood behind his November 2011 deposition, but Denison dodged the question by saying the models being discussed in the presentations and in the case now aren’t the same ones he was asked to comment on in that deposition. Judge Lucy Koh noted that she disagreed with Samsung on Denison’s ability to speak more broadly on the topic of “copying.”
Following a break, Samsung lawyers also quizzed Denison, asking him to clarify which models of phone he was speaking of in the 2011 deposition. In response, he mentioned the Galaxy Tab, the Droid Charge, the Galaxy S and the Infuse4G. Denison was asked if recommendations of the kind seen previously were made when comparing the iPhone and the Samsung Galaxy S, and he said he was not aware of any.
Samsung’s attorney handed Denison an iPhone and an Infuse4G and asked him to describe how they are different. Apple objected to this, however, so Denison simply described the Infuse4G while the two phones were handed around to the jury. The judge shortly afterwards prevented Denison from describing what the Infuse4G designers had been going for, since the designers themselves would be testifying later. The Galaxy S smartphone and the Galaxy 4G were also introduced and shown to the jury.
Samsung’s attorney asked Denison why the Samsung models have rounded corners (like the original iPhone and subsequent models). He replied that rounded corners fit better in one’s hand, and slide into pockets more easily. He added that the design is a durability issue -- if one drops a phone with a sharp edge, it is more likely to break. He was also asked about why phones have rectangular screens, black masks around the screen, and why the screen in centered, with simple explanations that painted each as a logical, inevitable option (even though Samsung itself has occasionally abandoned these concepts, for example producing phones with sharp corners and curved glass).
When asked if Samsung wants to beat Apple, Denison said that the company wanted to sell more products, but when asked if Samsung only wanted to beat Apple, he said that Samsung “monitor[s] all competition” in the market -- despite having authored a presentation that said that the smartphone market was essentially down to just Samsung and Apple.
Denison described Samsung’s strategy for dominance as being different from Apple’s, in that the company wanted to deliver “multiple products at multiple price points” unlike the strategy Apple had pursued for most of the iPhone’s product cycle. He added that copying, in his view, did not create a sustainable advantage.
He pointed out that Apple introduces roughly one new model every year and is still primarily identified with one carrier in most markets. Samsung, he said, introduced 50 models in 2011, offering different carriers different feature sets and different price points. Like Apple, Denison said STA (the US branch of the company) spent about $1 billion in marketing.
He estimated that the parent company had spent about $35 billion over the last few years on research and development, and said there are around 50,000 engineers and upwards of 1,200 designers at Samsung. He added that Samsung has been the second most-awarded patent creator since at least 2008, and mentioned that the company was the first with a camera phone, and pushed technology such as Super AMOLED displays.
Asked if he thought consumers bought phones as an “impulse” decision, he offered the oddly specific statistic (not sourced, but presumably from Samsung’s own research) that customers take six weeks to decide which smartphone to buy. Denison was asked if he’d heard of any examples of people buying Samsung phones thinking they were iPhones, and he said no.
The last report exhibited was one by Denison that came out last year entitled “iPhone 5 counter strategy” but he pointed out that as Apple surprised the industry by not coming out with an iPhone 5, the information in the document was likely to be inaccurate. Denison is expected to re-take the stand later today at noon eastern time.