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Analysts expect things to turn out bad for Creative Labs

In an interesting turn of events this week, Apple Computer has filed yet another countersuit against Creative Labs. After Creative launched its lawsuit against Apple several weeks ago, claiming that Apple had infringed on patents it owns in regards to the interface used in iPods, Apple decided that it would stand up and fight back, throwing a countersuit at Creative. According to Creative, it owns the rights to the user interface that iPods use, saying that it had invented it several years ago for its Zen line of portable MP3 players. Upon the news, many users lashed out at Creative, indicating that Creative had acted as a patent troll.

The new countersuit from Apple claims that Creative infringed on Apple's own patents that involved displaying of data, editing of mobile data on a desktop PC and computer icons.  The number of patents total up to four currently, and Apple doesn't seem to be holding back. No information from Apple was given on whether or not the company wants to pursue even more infringement allegations but it this week, Apple's stock performance has been improving while Creative has been suffering.

Creative responded this week to reporters saying that Creative already expected Apple to file countersuits and that Creative has already allocated the necessary resources to defend itself from Apple. Lately, Apple has been in the courtroom quite often, first with The Beatle's holding company, Apple Corps. for ordeals involving iTunes -- which Apple Computer won. Later, Apple was seen in court with the Electronic Frontier Foundation; a case in which Apple ended up losing trying to obtain rights to getting source information from journalists.

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why can't just creative
By fliguy84 on 6/8/2006 8:34:34 PM , Rating: 2
Why can't just Creative spend more money for R&D instead of using it in a case where they might lose? I like Creative products very much but I just can't see why they couldn't fight with quality products vs Apple's

RE: why can't just creative
By Wahsapa on 6/8/2006 8:42:58 PM , Rating: 2
depends on what you mean by quality


r&d wouldnt help creative - an online music store would.

nobody knows what creative should do, not even creative. i guess they arnt that creative.

RE: why can't just creative
By Fenixgoon on 6/8/2006 9:04:43 PM , Rating: 2
creative supports mp3's though - they don't need a music store to push any specific format.

but yeah, creative sued aureal out of existence :(

i hope they do that to apple though ;)

RE: why can't just creative
By poohbear on 6/8/2006 9:22:20 PM , Rating: 2
sueing aureal out of existence didnt exactly help the sound card market mate, creative has a monoply over it. I fail to sue how sueing apple out of existence (as absurd as that sounds since apple is much bigger) would benefit the mp3/music player market?

RE: why can't just creative
By Tuan Nguyen on 6/8/2006 9:24:29 PM , Rating: 2
Actually, Creative acquired Aureal's intellectual property and consequently Aureal was dismantled -- not sued.


RE: why can't just creative
By ViRGE on 6/9/2006 12:32:10 AM , Rating: 2
Aureal was sued before they sold out. Creative lost, but the legal bills were immense for both sides, especially tiny Aureal.

RE: why can't just creative
By Samus on 6/9/2006 5:49:56 AM , Rating: 3
and thats why i dont own any creative products, aureal had clearly superior technology (A3D opposed to EAX) and very good 1st and 3rd party driver support (i believe the vortex/vortex2 had linux support before the live! did)

besides, my $28 envy24 (chaintech) card spits out higher quality than any creative product under $200, and the drivers are 2.5mb, not 250mb.

RE: why can't just creative
By TheDoc9 on 6/9/2006 10:48:22 AM , Rating: 2
While they did definitly have superior technology (I believe they were contractors for NASA). Their cards slowed performance often to a crawl in games. Dropping frame rates sometimes 20 - 40%.

RE: why can't just creative
By Spacecomber on 6/11/2006 4:26:04 PM , Rating: 2
That was the buzz, but I never experienced that kind of impact from using an Aureal based card. Aureal also made great strides with each driver release; so, before they were done, their cards actually had lower CPU usage than Creative's.

I always wondered if what did Aureal in was a rather successful negative viral campaign on Creative's part, since so many people seemed to hold this negative view of the Aureal card's poor performance. As best as I can tell, this conclusion was based on a kind of apples to oranges comparison, and statements derived from this situation where never placed into their proper context.

Anyway, I just find it interesting that this meme still lives on, unchanged, even after all these years.

RE: why can't just creative
By fliguy84 on 6/9/2006 1:26:58 AM , Rating: 2
r&d wouldnt help creative - an online music store would.

Why would they need it? Napster, Rhapsody, Urge etc. work just fine with Creative products. Besides, the songs are much cheaper than iTunes'.

RE: why can't just creative
By jtesoro on 6/9/2006 8:23:46 AM , Rating: 2
A well-designed online music store might help. Love or hate Apple, iTunes is one of the key pillars making the iPod so successful today. Competing music stores like Napster still isn't enough to turn the tide against them.

RE: why can't just creative
By plinden on 6/9/2006 12:38:16 PM , Rating: 2
creative supports mp3's though ...

So does the iPod. I have all my CDs ripped to my iPod and only have 20 or so songs downloaded from iTunes ... done in the first flush of excitement before I realised I'd rather just have the CDs.

It's those 20 songs that I can't play on any other nonApple player ... unless I strip the DRM by burning them to a CD and ripping them to mp3s.

Pot calling the kettle black
By cableguide on 6/9/2006 9:56:10 AM , Rating: 2
" It is about a closed architecture which lines Apple's pockets."

Microsoft's DRM (Plays for Sure) is closed also. You can't play files encrypted with it on a mac. At least Apple's DRM can be played on a windows and a Mac! Apple has publicly stated that they will license their DRM to other vendors such as Napster but no one is willing to go against the all mighty Gates. So..... they all sit on the sidelines while Apple and iTunes control 80% of the market. BTW, how's that microsoft stock doing guys? Cuz my apple stock is soaring!!!!!!

RE: Pot calling the kettle black
By ShapeGSX on 6/9/2006 4:20:16 PM , Rating: 2

Apple stock is down about $27 from its peak of $86 in January. If I owned Apple stock, I would have sold it back when it was "soaring" because it sure isn't soaring now.

RE: Pot calling the kettle black
By gramboh on 6/9/2006 4:55:32 PM , Rating: 2
I'd love to see both Apple and Creative, I hate both companies. Why buy an iPod? Buy a player that acts as a USB mass storage device and then you can copy any file you want using ANY interface you want. No crappy iTunes and DRM involved. Much better. I have an Archos player and it's great.

The hilarious thing about audio DRM is you can always play it over digital out and rip at the source at full quality. What a joke.

By michael2k on 6/9/2006 5:53:43 PM , Rating: 2
Q) Why buy an iPod?
A) You don't have the time, skill, or desire to organize your music files on your computer.
A) The iPod is a USB mass storage device that you can use as a backup and restore option.
A) You don't have the time, skill, or desire to use an interface more complicated than the iPod.
A) The iPod is cheaper (currently $269 for 30gb from Amazon)

The hilarious thing about Apple's DRM is that you don't have to play it over digital out; their "crappy" iTunes allows you to burn the DRM at full quality to CD, essentially burning and ripping at 52x, much faster than playing it and re-recording it at 1x speed.

RE: Pot calling the kettle black
By Hare on 6/10/2006 3:52:55 AM , Rating: 2
What are you talking about? iPod simply supports drm-protected music. It's not like you can't play your own ripped cds. No one is forcing you to use iTunes Music Store. It's just an option.

An option you can't use with your archos which by the way is miles away from the ipod when it comes to usability.

One more thing. You can use the ipod as a usb/fireware external hd. With third party apps you don't even have to use iTunes to move music to your iPod, just drag n drop from your OS.

RE: Pot calling the kettle black
By Trisped on 6/12/2006 1:29:36 PM , Rating: 2
From what I understand only recent iPods allow standard file storage.

Yes, iPods can use non-DRM music, but only iPod can use the preferred iTunes music store.

I have had many complaints from friends that once they installed iTunes it reorganized their music so they couldn't find anything and also voicing concern that something happened to their iTunes install or iPod and now they can't use their music.

And don't forget that for their price, the iPod is very feature lacking. For the price of a 30GB iPod I could get one of three different brands that have all the features of the iPod (except the iTunes DRM compatibility) as well as FM tuner, the ability to record FM or Mic to MP3, better battery life, and better analog converter for $50 less.

RE: Pot calling the kettle black
By michael2k on 6/12/2006 2:48:38 PM , Rating: 2
The iPod from 2001 was a Firewire Mass Storage Device; I could boot my laptop from it, backup my documents to it, and of course, play my music from it. When Windows compatibility was added, I think it was also a Mass Storage device.

So the iPods have allowed standard file storage for five years running now.

RE: Pot calling the kettle black
By drxploder on 6/10/2006 3:54:54 AM , Rating: 2
Find me the statement where apple said it'd open its drm.
Believe it or not, not everything Microsoft does is evil. Plays4Sure is good because if Creative stops making players I like I can choose Iriver, Cowon, Sandisk, etc... If Napster stops being acting how I like it, I can switch to Rhapsody or Yahoo. What happens to an Ipod user when iTunes doesn't have a song they want online?

RE: Pot calling the kettle black
By michael2k on 6/11/2006 9:49:03 PM , Rating: 2
The iTunes user will buy the CD, the exact same as when the song they want isn't listed on a PlaysForSure store.

RE: Pot calling the kettle black
By Trisped on 6/12/2006 1:11:32 PM , Rating: 2
By your own post you indicate that Apple is trying to keep a closed architecture.

Licensinge DRM to Napster is not going to increase the number of MP3 players that can read the file. It will increase the number of music vendors though, which will increase the demand/value of the iPod. Result, Apple keeps their strangle hold on the mobile MP3 market.

Apple Sure Looks Like A Patent Pirate
By rjriley5000 on 6/9/2006 8:06:22 AM , Rating: 2
For some reason I could not post. The problem cleared up when I searched for the article from the home page and reposted.

Patent Pirates like to whine when their not so reputable conduct causes inventors to sue them about patent trolls. It is a cleaver slur designed to deflect peoples attention from the fact that patent pirates are liars, cheats , and thieves. Patent pirates pillage and rape inventors and then compound the sin with massive media campaigns to paint their victims as the bad apple.

Companies who start out as real innovators gradually lose their edge. They no longer produce significant inventions. This is what has happened to Apple.

At some point such companies need to acquire ever increasing amounts of new technology from generally newer and more innovative companies. They have a choice to operate reputably, and purchase the rights to an invention or to play school yard bully and use others' inventions without permission. Apple chose the latter path long ago.

All these counter suits make me think that Apple knows that they have been caught with their hand in another's patent cookie jar. It is an attempt to use the high cost of litigation as a weapon in the hope that the other party will not be able to afford to stay in the game to the end. If they can bankrupt the other party then they get away with taking their property.

Like many once great companies Apple started in a garage. Today Apple and like minded companies are doing their best to ensure that the new inventors who are much more creative than they are do not get a chance to grow into competitors. Apple is pushing changes to our patent system which would make it a sport of kings as a means to delay their inevitable decline in the face of competition from those who are more innovative.

iPod is all about a marketing snow job. It is about a closed architecture which lines Apple's pockets. People should abandon the iPod in favor of hardware which allows the user to purchase music from sources of their choice. Apple is not an innovator, they are schemers who are taking advantage of real innovators and the public alike. It is time the public takes their dollars elsewhere.

Ronald J Riley, President
Professional Inventors Alliance
Change "at" to @
RJR Direct # (202) 318-1595


Ronald J Riley, Exec. Dir.
InventorEd, Inc.
Change "at" to @

RE: Apple Sure Looks Like A Patent Pirate
By AnaxagorasZeres on 6/9/2006 8:32:22 AM , Rating: 2
You do know Creative drew first blood, right?

RE: Apple Sure Looks Like A Patent Pirate
By Trisped on 6/12/2006 1:06:53 PM , Rating: 2
Actualy Apple drew first blood, as the act of stealing is an attack.

By michael2k on 6/12/2006 2:46:42 PM , Rating: 2
Apple stole nothing though; they merely implemented their existing "Column view" in the Finder, in existence since 1986 in NeXTStep and reimplemented in 1997 in OS X and re-released in 2001 in the iPod.

Creative can claim the patent as loudly as they want, but they didn't invent it. NeXTStep did first, in 1986.

RE: Apple Sure Looks Like A Patent Pirate
By TheDoc9 on 6/9/2006 10:59:15 AM , Rating: 2
Some of that is true. But creative is the same way, remimber Aureal...

The law suits with the apple news sites and now these will hopefully wake people up to the reality of the company their dealing with.

By Trisped on 6/12/2006 1:07:51 PM , Rating: 2
I believe the limitations of Aureal and the Creative/Aureal problems have already been discused in an earlier post.

A call to arms is great..... but
By Dfere on 6/9/2006 12:46:41 PM , Rating: 2
It , in itself, doesn't right the "injustice". Kudos to you in promoting your business and your foundation. Kudos to Apple for trying to maintain a higher rate of return for their investors (or higher corporate salaries while maintaining the current rate of return) as noone likes their 401(k) to decline in value.

But none of these moral arguments matter- this is business. Ultimately, people are waking up from the Ipod craze for all of the technical reasons posted above. I called it the 128Mhz blues a few months back in another article.

The only question is, will a smaller more efficient company, which is much more innovative and can compete with less bloated expense structure to bring these types of goods to markets?; or will another big player attempt to leverage market share by any means, to the further detriment of the consumer?

This is what the anti-trust/patent disputes are supposed to resolve, but as you mention above, often it is a case of who has the biggest war budget.

If you think this is injustice, then the question becomes is how to change this, and the answer is simple. Don't buy mutual funds, and go and vote your shares at stockholder meetings. Else sit back, listen to your stockbroker/financial planner and pay attention only to the daily swings in value on your 401(k) holdings, and demand the highest return you can get.

We can't have it both ways, people.

Would you seriously shut up?
By Sharky974 on 6/9/06, Rating: 0
RE: Would you seriously shut up?
By wil2xl on 6/9/2006 1:23:11 AM , Rating: 3
and what exactly is the spin? i see the article stated what apple won and what it lost. where does it say apple should win and apple shouldn't win?

RE: Would you seriously shut up?
By jtesoro on 6/9/2006 8:25:26 AM , Rating: 2
I didn't see the spin either.

RE: Would you seriously shut up?
By iamright on 6/9/2006 2:33:23 AM , Rating: 1
I hope apple sues creative out of existense. I think that would be a good "spin" on things. I am so smart and I can use the eff word but don't want to.

RE: Would you seriously shut up?
By Trisped on 6/12/2006 12:54:43 PM , Rating: 2
That does bring up the point that you guys seem to show favoritism to Apple (especially iPod), NVIDIA, and AMD.

By dude on 6/8/2006 10:02:58 PM , Rating: 2
Wow, talk about opening up a can of worms!

I don't see why Creative would sue Apple over something as simple as this. After all, it's been around in computers for how many years now?

For this, I'm glad Apple counter sued them.

I was always a fan of Creative, until they made the SB Live. Boy, was that card buggy or just had really bad drivers? And their software package that comes with their audio cards suck, not to mention bloated!

RE: dude
By Trisped on 6/12/2006 12:50:35 PM , Rating: 2
Creative is suing because Apple stole a very complicated and inventive GUI. Apple is sure that Creative is right, otherwise they wouldn't counter sue.

Apple is not truly counter suing, as Apple is suing for patents that have nothing to do with Mobile MP3 players. “The new countersuit from Apple claims that Creative infringed on Apple's own patents that involved displaying of data, editing of mobile data on a desktop PC and computer icons.” The validity of those claims would be difficult to determine without going through Creative and Apple patents to see who owns what. It is logical though that Creative would have made their software similar to iTunes since iTunes is the most used.

The SBLive was a little buggy, but most of the problems were limited drivers and limited software support.

There is the problem of the Creative monopoly on add in audio cards for PCs. The solution was presented that NVIDIA and a few others made audio cards to compete with Creative, but they got their buts kicked. Creative might have weak software and funky drivers, but the options and quality of the hardware is superb.

RE: dude
By michael2k on 6/12/2006 2:35:45 PM , Rating: 2
Believe that if you want. I think Apple is in the right.

You do know, after all, that Apple, with work from Xerox, invented the modern UI 20 years ago, right? And then Jobs, who left to found NeXT, continued adding additional UI enhancements to the computing landscape?

If you follow the menu structure of the iPod, it is identical to the Finder structure now featured in OS X, but first released in NeXTStep in 1986. Creative can claim the patent all they want, but NeXStep had been using it for years and can claim prior art. So the validity chain is as thus:

NeXTStep: Column browser, 1986
Apple: Purchased NeXTStep, 1996
Apple: Released iTunes, 2000
Creative: Released Nomad Jukebox, with a folder based interface, in 2000
Apple: Released iPod, with the iTunes/NeXStep interface, in 2001
Creative: Released the Zen interface, now greatly resembling the iPod, in 2004
Creative: Rebrands the patent the "Zen patent" in 2005

Bill can save the day
By kibets on 6/8/2006 11:09:12 PM , Rating: 2
Microsoft is lending a hand and is trying to rally the anti-iPod troops into a unified format. Lets hope Bill will prevail with his superior WMA format and Plays for Sure DRM functionality.

I can not stand Jobs, his turtle neck sweaters or the iPod.

Let the revolution against this evil company Apple strike hard and cause great damage to iPod and co.

RE: Bill can save the day
By Burning Bridges on 6/9/2006 7:46:51 AM , Rating: 2
.ogg ftw :P

RE: Bill can save the day
By Swaid on 6/10/2006 4:43:02 AM , Rating: 2
OGG/OGM 4 life!

Software patents
By Hare on 6/9/2006 4:45:23 AM , Rating: 2
I hope that crap never reaches the EU ! It's just ridiculous that Creative even tried to sue Apple. Patenting menus and sliders is just hilarious. How about patenting breathing? I hope creative loses and loses big time. I quess it's just competition but these kinds of law suits are so stupid it's hard to describe.

RE: Software patents
By Trisped on 6/12/2006 1:02:11 PM , Rating: 2
In the past music players just allowed you to play what was on the media in the order selected. Then CDs allowed you to select which track played next. MP3 players allowed you to select which song based on pre-made play lists and to search for files based on the file scheme and file name.

Creative took the next step, allowing you to play files not logically grouped together, like playing all the songs of one genre, by a particular artist, with a set theme, etc. Since they knew it was such a good idea they patented it. Rather then buy the rights, Apple just copied the contents of the patent and used them in their own players.

Normally this would end up with the big company (Apple due to the iPods success) either licensing the right to use the menu system, losing the suit and having to pay Creative, or Apple removing the feature. But normally the big company is one that people hate (like Microsoft). Since Apple has such a big cult following the odds are that they will get away with everything, which will be a big blow to inventors and innovators everywhere.

blah blah
By cochy on 6/9/2006 5:59:17 PM , Rating: 2
The way patents are handled is a joke. When you can patent parts of the human gnome you know there's a problem.

RE: blah blah
By Trisped on 6/12/2006 1:32:36 PM , Rating: 2
When you spend three years finding a gene responsible for preventing cancer you don't want another company to steel the info and sell the "cure" for less then you can because you have to pay back all the money spend on research.

Take the patents outside!
By 9nails on 6/9/2006 8:06:52 PM , Rating: 2
Creative's Exec's need to call Apple's Exec's and have them meet each other at some undisclosed park. No blunts, knives or guns. And just throw down like real men. Heck, I'd even concede to allowing the lawyers do the fighting instead of the Exec's! Best group of men (or wimmen) wins. I'd much rather see the video and the aftermath at youtube than read about it here!

RE: Take the patents outside!
By The Cheeba on 6/10/2006 6:27:01 AM , Rating: 2
Obligatory Simpsons quote:
Well, since there is no room for you at the prisons you came from, I going to have you all put on a garbage barge where you will bareknuckle box each other until one of you emerges as king of your floating hell.

It Seems....
By crystal clear on 6/11/2006 1:08:37 AM , Rating: 2
It appears Apple will be more occupied fighting others in court than launching new products.
EU is out to get them already.

RE: It Seems....
By michael2k on 6/11/2006 9:25:24 AM , Rating: 2
This is why Apple hires lawyers. Lawyers attack other lawyers while developers attack other developers.

I have yet
By Merry on 6/8/2006 9:03:40 PM , Rating: 2
To see a MP3 player worthy of spending £200 on.

Maybe Apple and Creative should think about making one, rather than squabling like children.

Until my CD player is perfectly adequate.

By ElJefe69 on 6/11/2006 2:51:24 PM , Rating: 2
Lawyers, the courts, and big companies suck cock.

By ipwnurmom on 6/9/2006 2:00:20 AM , Rating: 1
im posting on teh internet. my opinion matters and i know what im talking about. i know what all teh big corporations need to do because im so smart im on the internet. im a big computer whiz and i know so much more than ur mom does. lol.

By Howard on 6/8/06, Rating: -1
"It seems as though my state-funded math degree has failed me. Let the lashings commence." -- DailyTech Editor-in-Chief Kristopher Kubicki
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