{"id":6385,"date":"2012-08-27T09:44:21","date_gmt":"2012-08-26T23:44:21","guid":{"rendered":"http:\/\/blogs.unsw.edu.au\/knowledgetoday\/?p=6385"},"modified":"2012-08-27T09:44:21","modified_gmt":"2012-08-26T23:44:21","slug":"appleinnovation","status":"publish","type":"post","link":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/blog\/2012\/08\/appleinnovation\/","title":{"rendered":"Patent Truth for Apple: Innovate to Stay on Top"},"content":{"rendered":"

From the\u00a0Knowledge@Wharton today\u00a0blog<\/a>.<\/strong><\/p>\n

Apple\u2019s innovation model is being challenged in its patent spat with Samsung, even as its recent stock price climb made it\u00a0the most valuable company in the U.S.<\/a> Wharton legal studies and business ethics professor\u00a0Kevin Werbach<\/a> says the patent system in software and IT is \u201cbroken,\u201d but the maker of the iconic iPhone, iPad and iPod devices has to keep innovating to stay ahead of competitors.<\/p>\n

After a three-week trial in the U.S., the Apple-Samsung patent case went to jurors earlier this week, and a verdict is expected in the next few days. Apple has accused Samsung of copying its patented designs and software, and an adverse ruling for Samsung could result in a ban on some of its products in the U.S. In a countersuit, Samsung has also accused Apple of patent infringements. Today,\u00a0a court in South Korea ruled<\/a> that both companies violated each other\u2019s patents, and ordered the firms to pay damages in addition to imposing a ban on sales of some of their products.<\/p>\n

According to Werbach, the dispute raises bigger questions about innovation, competition and patents. The patent system has become \u201ca competitive weapon rather than a means of fostering innovation,\u201d he says. The devices, services and systems in the Internet ecosystem depend on other parts of the system, and build on established foundations, he adds. \u201cIf restrictive licensing and relentless patent warfare become endemic to the Internet economy, growth and innovation are bound to suffer.\u201d<\/p>\n

Many core technological innovations \u2014 such as the communication protocols that underlie the Internet and the Unix foundation for Apple\u2019s OS X operating system \u2014 are available to anyone for free, thanks to the involvement of governments, academic institutions and far-sighted innovators, Werbach points out. \u201cVast amounts of money have been made on top of the innovations they gave away.\u201d<\/p>\n

Apple\u2019s growing rivalry with Samsung seems understandable. Samsung has the largest share of the global smartphone market \u2014 21.6% in this year\u2019s second quarter, compared to 16.3% in the same quarter last year, according to research firm Gartner. Apple\u2019s market share for its iPhone also grew in the same period \u2014 from 4.5% to 6.9%, which places it third in the sector, behind Nokia with 19.9% share.<\/p>\n

However, Apple made history when its market capitalization crossed $623 billion on Monday. That makes it worth 17 times as much as Ford Motor Company, seven times as much as McDonald\u2019s Corporation and 13 times as valuable as Facebook, according to a\u00a0Los Angeles Times<\/em> report<\/a>. Microsoft had until now held the crown of being the most valuable U.S. company, based on a $621 billion market cap in 1999.<\/p>\n

Werbach says he isn\u2019t surprised about Apple\u2019s valuation peak, although its continued dominance isn\u2019t guaranteed. Market cap honors can be transient because they fluctuate based on investor expectations. Ultimately, innovation will remain the key for the company to stay ahead of its competitors. \u201cApple makes real things that people pay real money for, with consistently strong margins \u2014 which requires huge resources to compete against in a growing global market. That\u2019s a good place to be.\u201d<\/p>\n

This blog was previously posted in Knowledge@Wharton today blog:\u00a0Patent Truth for Apple: Innovate to Stay on Top<\/a>
\n<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

From the\u00a0Knowledge@Wharton today\u00a0blog. Apple\u2019s innovation model is being challenged in its patent spat with Samsung, even as its recent stock price climb made it\u00a0the most valuable company in the U.S. Wharton legal studies and business ethics professor\u00a0Kevin Werbach says the patent system in software and IT is \u201cbroken,\u201d but the maker of the iconic iPhone, […]<\/p>\n","protected":false},"author":336,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[14659],"class_list":["post-6385","post","type-post","status-publish","format-standard","hentry","category-innovation","tag-apple"],"_links":{"self":[{"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/posts\/6385","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/users\/336"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/comments?post=6385"}],"version-history":[{"count":2,"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/posts\/6385\/revisions"}],"predecessor-version":[{"id":6387,"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/posts\/6385\/revisions\/6387"}],"wp:attachment":[{"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/media?parent=6385"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/categories?post=6385"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.unsw.edu.au\/BTOpinion\/wp-json\/wp\/v2\/tags?post=6385"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}