Surprise Apple win may force OEMs like Samsung and LG to use Windows Phone, although they'll first try to fight it

In June the U.S. Patent and Trademark Office (USPTO) hit gadget-maker Apple, Inc. (AAPL) with an invalidation of most of the claims of its "rubber-band" animation patent.  However, upon closer examination the final ruling crucially preserved the '19 claim that Apple asserted against Samsung Electronics Comp., Ltd. (KSC:005930) in its initial federal lawsuit, which netted Apple $1B USD in a jury verdict.

I. Next on the Banned List

But if that invalidation ruling was a bit of a mixed bag for Apple's crusade to exclude top Android phonemakers' product from the market, the latest ruling from the U.S. Patent and Trademark Office (USPTO) on a key touch patent is a flat-out win for Apple, and a surprise win at that.

After an earlier pre-examination found the patent entirely invalid on the grounds of prior art, on Sept. 4 the USPTO issued a reexamination certificate that found that all the claims of Apple's U.S. Patent No. 7,479,949 to be valid.  The patent covers "touch screen device, method, and graphical user interface for determining commands by applying heuristics" a set of ambiguous UI and touch gesture descriptions.

Apple patentSwipingApple Patent
The right to "scroll", "swipe", and type on a modern touch screen are all owned by Apple.

The validation of the patent -- which Apple affectionately refers to as "the Steve Jobs multitouch patent" is dire news for top Android phonemakers and tablet makers like Samsung, LG Electronics Inc. (KSC:066570), and the Lenovo Group, Ltd. (HKG:0992), which could be faced with the choice of having their flagship products banned from sale, or crippled by Apple.

Specifically the multitouch patent covers a variety of now ubiquitous gestures on capacitive multi-touch screens.  For example if you swipe down on a diagonal downward it's interpreted as a scroll downwards -- likewise if you swipe sideways, but your finger doesn't follow an exact straight line.  The patent also covers virtually all multitouch gestures, which are composed by swipes on angles.  Last, but not least the patent covers typing on a virtual keyboard on capacitive screens.

Of course Apple didn't invent any of these things -- multitouch and heuristics for detected angular swipes were available on older resistive touch screens.  However, modern phones don't use resistive touch.  The current state of U.S. technology patents allows you to repatent virtually identical firmware on a new kind of hardware.

Since Apple secured virtually all of the early stock capacitive multitouch screens, which it used in the original iPhone, it was the first phonemaker to release a device with capacitive multitouch.  And as late CEO Steve Jobs once said...

Now the entire industry has shifted to capacitive multitouch -- so aside from those that have licensing agreements with Apple, essentially every other smartphone/tablet on the market is in violation of Apple's patent.  Last quarter the International Data Corp. (IDC) reported that Android represented roughly four out of every five smartphone sales -- so Apple now has the legal firepower to go after most smartphones sold in the U.S., including Samsung's best-selling Galaxy lineup.

II. Android's Options -- Face Likely Ban, or Drop Multitouch, Physical Keyboards

It'd be an unthinkable "solution" for Samsung and others to stop using capacitive multitouch, given that consumers today expect it.  There's no feasible technological alternative at present given that resistive touch would feel remarkably unresponsive by multitouch standards.

Dropping multitouch would be a bad blow to Android -- particularly image-wise -- but not altogether crippling (the original Android, the HTC Dream, aka the "G1" lacked multitouch).  Likewise, not being able to use virtual keyboards would be a major setback -- but not a deal breaker for Android OEMs, who could always return to physical keyboards that were popular in the pre-smartphone era.

Android keyboard
Android devices will now likely have to return to using physical keyboard to avoid being banned.

However, the worst part of the validation for Android OEMs is the validated claims regarding single-finger ("one or more fingers") scrolls/swipes.  Because of that, Android would be required to make it such that their devices would not respond to swipes or scrolls unless users made the swipe in precisely a straight, unbroken line.

Android OEMs still have a very slim hope that they could invalidate or partially invalidate the patent in federal court, especially given that many claims of the patent were invalidated in an earlier phase of the USPTO review, and later reversed.  However, invalidation in a reexamination merely requires a "preponderance" of evidence, where as invalidation in a court case requires "clear and convincing" evidence.  Federal Judges are typically reluctant to challenge the USPTO -- particularly after a patent has been examined.  And given Apple's brand image, it seems unlikely that a jury would suggest that a judge rule its patent invalid.
Apple gavel
[Image Source: CNET]

Now one Android OEM -- HTC Corp. (TPE:2498) -- is safe, as Apple agreed to a licensing pact with it.  It was generally perceived that Apple agreed to this deal as it perceived HTC as a nonthreat (unlike Samsung), but the move could prove a boost if the other Android OEMs are banned from the U.S. market.

Apple has already banned numerous older Samsung devices from shipment into the U.S., in addition to the $1B USD in damages it secured from Samsung using infringement.  Now it will likely look to move aggressively to ban shipments of newer Samsung tablets and smartphones like the Galaxy S4.

Galaxy S II, Galaxy Tab 10.1Nexus 7
Older Samsung devices are already banned in the U.S.

Samsung is forbidden from suing back, for the most part, as most of its smartphone intellectual property are part of standards -- deep hardware inventions.  But in today's patent climate, such innovations are considered diminuitive in value, compared to patenting abstract, ambiguous interface ideas.

III. The Real Winner? Windows Phone

On the other hand the verdict may have an unexpected side effect.  Android OEMs do have one clear escape route -- abandon Android for Windows Phone, a third party platform that's sheltered by Apple's licensing pact with Microsoft Corp. (MSFT).  Given that Samsung is already paying licensing fees on non-Windows Phone devices to Microsoft, such a move could also make financial sense.

So the biggest winner of this surprising development may be Microsoft.

Android OEMs -- even HTC -- also face a second threat from Nokia Oyj. (HEL:NOK1V) who is threatening to ban Android products if Android OEMs don't pay even higher licensing fees for currently unlicensed Nokia patents.  Of course, if the OEMs drop Android for Windows Phone -- whom Nokia has a licensing pact with -- the Android OEMs will have to pay nothing.  In fact, Microsoft -- eager (or desperate?) for a dominant position in the mobile market -- is even offering OEMs like Samsung and HTC money to go Windows Phone exclusive.

The HTC 8S Windows Phone

Likewise Android tabletmakers may eye a switch to Windows 8.1 as an escape route from bans.  Soon customers' choices in the tablet market may be -- Windows 8.1 tablets (various OEMs), Apple's iPad, or nothing.

So Android OEMs now will either have to pay licensing payments to Microsoft and Nokia on every device sold, plus face possible bans from Apple -- or they must drop Android and switch to Windows Phone. That's likely not the outcome Apple -- or its late cofounder Steve Jobs wanted.  But it's more or less the outcome I predicted when I wrote "Can Microsoft and Apple Kill Google's Android with Lawsuits?" back in 2011.

It will likely be a year or two before this all shakes down, as Samsung will likely have to be smacked with major bans on new product before it begrudgingly would decide to drop Android for Windows Phone.  But I'm warning you to prepare yourself now, Samsung fans -- and Android fans in general -- unfair or not, the legal recourses for keeping a modern, useable Android device on the U.S. market are dwindling fast, thanks to Apple, Microsoft, and Nokia.

So you might want to steel yourself to accept the idea of buying a Samsung Galaxy S6 or S7 Windows Phone.  Unless, that is, you want an iPhone.

Source: SBNation [The Verge] [PDF]

"When an individual makes a copy of a song for himself, I suppose we can say he stole a song." -- Sony BMG attorney Jennifer Pariser

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