Apple vs. Samsung: The “Trial of the Century” between Two Very Different Companies

This Monday opened the patent infringement trial of Apple against Samsung, a testament to the vigorous competition in the mobile phone and tablet sector.

It is a decisive trial between two electronics giants: Apple and Samsung — two enterprises whose products are known around the whole planet or just about, historically with very different enterprise cultures and methods of management, but in direct competition in a key sector, that of mobile communication.

It is Apple, the inventor of the iPhone and the iPad, which accuses Samsung for infringement in front of the San Jose (California) federal court, accusing the defendant of having deliberately copied the concept of its leading products in mobile telephones and tablets. Samsung is not without success since the South Korean giant became number one worldwide with the Galaxy series.

Apple claims at least $2.3 billion dollars (1.9 billion euros) in damages and interest against Samsung. Moreover, the South Korean firm could, in case of defeat, see itself banned from the sale of certain models on the American market — an economic disaster.

After two years of proceedings, the trial will last a month and parade experts in intellectual property regarding the patents. Despite the dry subject matter, it is going to bring much attention, as these two enterprises are at the heart of a global technological and commercial affront that interests the whole world.

Two Giants with Different Profiles

It’s difficult to find two more different, at first sight, global enterprises:

• Apple is the child of the Silicon Valley wave of technological innovation, born in 1978 by the genius intuition of Steve Jobs, who no longer represents it, and Steve Wozniak. Apple generated a venerable passion in its users, who remember with emotion their first Apple II or Mac, and accomplished an exceptional breakthrough in MP3 players, then with the mobile phone, and finally in creating the tablet format that very quickly made a name for itself. As it grew, the company became more and more of an “owner,” creating closed and exclusive systems.

• Samsung is the antithesis: an enormous conglomerate (Chaebol) as South Korea knew to produce in accompaniment to its industrial development, and very diversified (from semi-conductors to building and civil engineering, with the household appliance industry and general public electronics in between). Samsung adopted the quirks of South Korea’s history, authoritarian and paternalist when the country was a dictatorship, then opening itself as its internationalization required — smiling global marketing. Its products were met with true success with the public.

The two enterprises meet notably on the China sub-contract. There is no longer a cultural difference to account for since Samsung manufactures, like Apple, via sub-contracts such as Taiwanese Foxconn in immense factories where the workforce is pressured to the point of suicide, or directly as Samsung does it in questionable social conditions.

Here are the basic facts of the two enterprises.

Apple

Date of creation: April 1, 1976 in Cupertino, California by Steve Jobs and Steve Wozniak.

Number of employees: 60,400 in 2011.

Sales and profits figures: $108.25 billion dollars (88.2 billion euros) from sales in 2011, and $25.92 billion in profit (21.1 billion euros).

Field of activity: personal computers, MP3 players, smartphones, tablets.

Flagship products: Macintosh computers, iPod, iPhone, iPad.

Samsung

Date of creation: March 1, 1938 by Lee Byungchui in Korea (present-day South Korea).

Number of employees: 344,000 in 2010.

Sales figures: $220 billion dollars (179.3 billion euros) of sales in 2010, and a profit of $21.2 billion dollars (17.2 billion euros).

Field of activity: conglomerate of 59 companies, in electronics, naval construction, building and civil engineering, etc. producing mobile telephones, televisions, home appliances, hard disks, etc.

Flagship products: Smartphones and tablets of the Galaxy series.

Patent War

These patent battles, of evident commercial consequence, exist since Google released its Android system to compete with Apple’s iPhone and liberally made it available to all manufacturers who wanted it. Samsung, the Taiwanese HTC and the American Motorola have thrown themselves into the chase after the dazzling success of the iPhone, which changed the manner in which one uses a phone in the world.

Last June, an American judge forbid Samsung to advertise its Galaxy Nexus telephone in the United States due to a patent violation linked to the Siri system, developed by a company bought out by Apple.

This first success boosted Apple’s spirits in its ability to defeat the greatest user of Android, which has become Samsung.

Samsung, for its part, accuses Apple of seeking to reduce the competition to protect its “exorbitant profits” attained since the release of its smartphones and tablets. The Korean firm also accuses Apple, according to The New York Times, of having in its turn created an “Android war room,” designed to analyze the innovative characteristics of its competitors’ systems.

For the users, the trial is not more than distant background noise of a fierce commercial competition. Even if, at the end, the victor of the San Jose trial could gain financial assets and non-negligible marketing, it’s on to ever more demanding customers.