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Schmidt also expresses frustration with patent wars; disdain for Windows Phone

When it comes to Eric Schmidt, former Google Inc. (GOOG) CEO and his company's arch-nemesis Apple, Inc. (AAPL), the ties that bind are almost as strong as the ties that separate.

I. Victims of Smartphone War are the Little Guys, Says Schmidt

During much of Mr. Schmidt's time atop the Google throne; he also served on Apple's board of directors.  The two companies had a fruitful relationship and Mr. Schmidt was close friends with late Apple CEO Steven P. Jobs.  That relationship fast deteriorated when Google decided to launch Android, a Linux based smartphone platform that would eventually come to heavily outsell Apple in the smartphone market in unit sales.  Mr. Jobs expressed a feeling of "betrayal" at the decision, which not only spoke to his zealous feelings of ownership of the smartphone market, but also his strange relationship with Google and Mr. Schmidt.

In an interview with the Wall Street Journal Mr. Schmidt speaks optimistically that the pair can work out their differences with respect to patent litigation, commenting:

[Google's relationship with Apple has] always been on and off.  Obviously, we would have preferred them to use our maps. They threw YouTube off the home screen [of iPhones and iPads]. I'm not quite sure why they did that.

[But] the adult way to run a business is to run it more like a country. They have disputes, yet they've actually been able to have huge trade with each other. They're not sending bombs at each other.

I think both Tim [Cook, Apple's CEO] and Larry [Page, Google's CEO], the sort of successors to Steve [Jobs] and me if you will, have an understanding of this state model. When they and their teams meet, they have just a long list of things to talk about.

Eric Schmidt
Former Google CEO Eric Schmidt is not concerned Android will be hurt by the patent wars.
[Image Source: The Sydney Morning Herald]

Mr. Schmidt says that both Apple and Google are "doing fine" and that neither side has been able to gain ground in the patent war, much like the entrenched empires of the First World War.  He says that the real "loser" in the patent wars are small startups, which might look to create an innovative news smartphone operating system as Android VP Andy Rubin did when his startup made what would later become Android back in the middle of the last decade.  With all the lawsuits and junk patents, Mr. Schmidt argues such "garage" innovation is simply impossible in today's legal climate.

II. Former CEO Addresses Criticism, Says Microsoft is no Threat

The Google executive admits that his company long lagged Apple in terms of financially compensating developers.  He remarks, "Google Play [Google's app store] and the monetization just started working well in the last year, maybe the last six months. The volume is indisputable, and with the volume comes the opportunity and the luxury of time."

As for the perennial question of whether Google will or should favor new acquisition Motorola Mobility over its third-party Android partners, Mr. Schmidt says that would be a "terrible mistake".  He says that when the deal was announced he personally flew to meet with executives at South Korea's Samsung Electronics Comp., Ltd. (KSC:005930) -- the world's largest smartphone maker and foremost Android adopter -- to assure them that there would be no favoritism.

As for Microsoft Corp.'s (MSFTWindows Phone; Mr. Schmidt was dismissive of the operating system.  He blasts, "I have not used it, but I think that Microsoft has not emerged as a trendsetter in this new model yet."
 

Eric Schmidt argues Microsoft's Windows Phone is no "trend setter".

Mr. Schmidt expressed hopes that current antitrust investigations into Google's involvement in various markets would wrap up.  He says he has no interest working for the Obama administration in a government post, saying Google has always been his "home".


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RE: Interesting, very interesting
By invidious on 12/5/2012 1:35:50 PM , Rating: 3
Copying trade secrets that aren't well protected is not a crime and is not wrong. When Apple allowed the Google CEO to sit on their board they gave away their secrets. Obviously they didn't expect Google to get into the phone market, but legally that is irrelivant.

Copying is not a bad thing, it is a cornerstone of capitalism. It is essential to innovation to allow companies to copy and improve upon each other's work. Copyrights and patents need to be respected, and both Apple and Google have not been good about that.


RE: Interesting, very interesting
By Tony Swash on 12/5/12, Rating: -1
RE: Interesting, very interesting
By Rukkian on 12/5/2012 3:43:51 PM , Rating: 2
I would love to see the proof you have to show that
quote:
the Android strategy has been a total failure from the point of view of Google's business, it's still a massive cost centre
. I am not talking about them making more money off apple (as we have all heard from you numerous times), I want to see where you can show that they have lost money on android.

I am not saying you are incorrect, just would like to see your proof, as it does not seem correct from everything I have seen.


By Cheesew1z69 on 12/5/2012 3:53:25 PM , Rating: 5
He doesn't have proof, it's all in his head.


RE: Interesting, very interesting
By Boze on 12/5/2012 4:08:45 PM , Rating: 2
Unethical... but sadly not illegal.


By sprockkets on 12/5/2012 4:45:31 PM , Rating: 1
It IS illegal. The very fact that apple hasn't sued Google over it is proof enough. Heck, he even recused himself when details of the iphone were being discussed at meetings.

Why do you think he had to leave the board of apple? Hint: Cause if he didn't he'd be in trouble with the law, even if apple didn't care.


By BifurcatedBoat on 12/5/2012 5:17:49 PM , Rating: 5
If we are to get into the ethics of copying, then Apple wouldn't have a leg to stand on.

Starting with the company name, which Apple lifted from well... Apple. (It's confusing to talk about, since what's now Apple Corps was just Apple back then, while today's Apple was Apple Computer.)

So then Apple and MS both lifted their OS design from Xerox. They got away with it legally, but I guess we're supposedly talking about ethics.

Apple took most of their ideas from others as they were growing in a company, and in Steve's own words, his company was shameless about it.

Even the iPhone design itself, as revealed in the Apple/Samsung trial was Apple's attempt to copy what they thought Sony was making, but without the benefit of a picture to use as a basis point.

So a company is going to talk about the evils of copying, it should be a company that doesn't do it themselves, wouldn't you think? Although, that might be hard to find, since almost all innovations are based on something that came before, and sometimes the improvements are pretty minor.


RE: Interesting, very interesting
By bug77 on 12/5/2012 5:53:13 PM , Rating: 3
quote:
...the Android strategy has been a total failure...


Total failure? Having millions of additional devices to show ads on must be a real death-blow to Google's core business.


By CubicleDilbert on 12/13/2012 1:33:18 PM , Rating: 2
Copying trade secrets has always been one od the driving forces of human nature and business. I agree with you.
In the 1850s England was by far the most technologically advanced nation in the world. They kept everything for themselves, sanctioned every bit of information transfer.

So continental Europeans started to work in England to find out their secrets such as production processes, materials, patents and so on.

While England did continue their slow way, Europeans exploited everything in continental markets and quickly surpassed England. Then and only then England began to market their machines and equipment to other nations. But it was already too late. Machines are Made in Germany. Qulity is Made in Germany. That was the fact 50 years later.
One key advantage was that continental Europe didn't care much about patents and scientific ownership. In England it was mostly reserved for the aristocratic upper class. In France, Germany and Italy those trade and science secrets were wide spread immediately among all workers, business men etc.
Competition at its best.

And where is England now and where is Germany?

Apple had a few ideas but after some time their development stalled. Others take over and based on old ideas they improve stuff. That's competitive evolution.

If Apple doesn't change, they go the way of The Wright Brothers. The brothers invented the airplane, got a US patent and kept it all to themselves. In Europe it was replicated and dramatically improved. Wright brothers made history, but others made the business.


"Spreading the rumors, it's very easy because the people who write about Apple want that story, and you can claim its credible because you spoke to someone at Apple." -- Investment guru Jim Cramer














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