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The European Commission is concerned that other firms could mimic Apple and Samsung's patent war and lead to the unfair use of intellectual property rights against rivals

Much of Apple and Samsung's 2011 has been spent duking it out over patents. Apple initially went after Samsung earlier this year and accused it of copying Apple's products when creating its Galaxy line of smartphones and tablets. Now, the European Commission is concerned that other firms could mimic Apple and Samsung's patent war and lead to the unfair use of intellectual property rights against rivals.

Throughout the year, Apple and Samsung have gone back and forth with patent issues. Apple claimed that Samsung created its Galaxy line such as the Galaxy Tab 10.1 by ripping off Apple's design. Apple succeeded in killing Samsung's Australian tablet sales, banned the Galaxy Tab 10.1 in Germany, and sought to ban Samsung's phones and Android tablets in Britain. But Samsung did some retaliating of its own by filing a 3G lawsuit against Apple in France, looking to ban iPhone 5 sales (back before it was revealed that the anticipated iPhone 5 was really the iPhone 4S), and modifying its hardware and software to prevent further lawsuits.

Earlier this month, the European Commission started looking into FRAND (fair, reasonable, and non-discriminatory) violations associated with the Apple/Samsung patent war. Now, the EU's latest concern has to do with the potential misuse of patents in other areas of the IT sector. 

"We requested information from both Apple and Samsung," said Joaquin Almunia, EU Competition Commissioner. "We have not yet received the answers. We need to look at this because IP rights can be used as a distortion of competition but we will need to look at the answers.

"In particular, in the IT sector, it is obvious it is not the only case. Apple and Samsung is only one case where IP rights can be used as an instrument to restrict competition. Standardization and IP rights are two instruments that in this new IT sector can be used as a tool to abuse."

Source: Reuters

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RE: It's about time
By psonice on 11/23/2011 9:41:12 AM , Rating: 5
It's samsung that's allegedly abusing the patent system in this case unfortunately, and it's them the EU are investigating from the look of it. Whoever wrote this article totally missed that point somehow.

Check what the EU say they're investigating: misuse of FRAND patents. Apple haven't used any FRAND patents against samsung, but samsung are using them against apple around the world. What the EU are investigating then is samsung's possible abuse of FRAND patents, there's no mention of apple's use of general patents.

Also, the EU have mentioned that there may be more antitrust investigations coming. The suspect there is Motorola, who are also using FRAND patents.

The patents samsung are using are for 3G. All companies depend on this for their phones, so it's covered by special licensing - FRAND. Basically they HAVE to license these, and they have to do it on fair terms. In comparison apple's patents (that they're suing with) aren't FRAND, and they don't have to license at all. If they do, they can charge whatever they want. Samsung has to either pay up, or challenge in the courts and get the patents killed or the products cleared of infringement.

Roughly what's happened is:

- Samsung invented it + patented it.
- It's used in 3G, so they signed up to a FRAND agreement.
- Qualcom license the patent and make 3G chips.
- Apple buy the chips and put them in the phones. Note that the patent license has already been paid once.
- Samsung ask for a license from apple. This is called 'double dipping', charging twice, and isn't allowed - but it depends on the exact license qualcom has and the qualcom/apple contract.
- They ask for 2%. Not much, but there are hundreds of these patents involved, meaning apple would pay multiple times the price of the chip in patent fees. Clearly that's not a fair price, so apple refused.
- Samsung are trying to get the iPhone banned.

Really, the whole patent system is screwed. If it did its job and just protected real inventions it would be fine, but it's not really doing that. But what samsung is doing here is MUCH worse - they could enforce these patents against *any* company making products with 3G, asking for unreasonable licenses, then getting products banned if the company doesn't pay up. It's hard to call that anything other than market abuse. Hopefully their court cases will fail and the EU will bash them with an enormous fine :)

RE: It's about time
By matty123 on 11/23/2011 11:02:15 AM , Rating: 2
Intresting post but as I understand it that was only the initial impression that the media got from the EU commision. The EU antitrust chief today seemed to be suggesting that they are probing both samsung and apple.

Of paticular note and very worrying for apple is this...

Firms can gain advantages over rivals by pushing for import bans in court, using patent infringement as justification for such a measure, which could have a devastating effect on any firm its enforced on.

If found guilty they could face massive massive fines apparently up to 10% of global annual revenue, seeing as apple has pushed and won injunctions against samsung around the world they could be in serios danger if one of their patents are overturned. Also seeing as apple is suing almost all the android competition they are most at risk of violating anti-trust laws.


RE: It's about time
By Piiman on 11/23/2011 5:07:57 PM , Rating: 2
I'd call it getting even.

"We’re Apple. We don’t wear suits. We don’t even own suits." -- Apple CEO Steve Jobs

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