Apple's $100m in legal costs are tiny - expect more lawsuits in 2012

Apple's $100m in legal costs are tiny - expect more lawsuits in 2012

Summary: Apple's huge legal fees are a very cheap insurance policy helping to protect massive profits.

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Apple has been waging legal battles against rivals such as Samsung. It may have spent more than $100 million on legal bills in 2011.

Tim O'Reilly, the influential CEO of book and conference company of the same name, tweeted:

He isn't the only critic, you can see others here:

It might seem like a lot of money is being wasted by Apple, but is it?

It looks like cheap insurance: $100 million represents just 1/460th of just three months' sales — $46 billion in its most recent quarter. It's an even smaller fraction of total annual sales.

Companies take legal action to protect their business, and in Apple's case it's a very big business indeed: $112 billion in 2011. That would make that $100 million in legal costs less than 0.1% of total revenues.

That's a tiny cost to hedge against competitors. And Apple can't be accused of using patent lawsuits instead of innovating, like Interval Research -- most agree that it continues to bring out unique and useful products.

It's easy to see why Apple won't be pulling back in its legal claims. In fact, it'll probably "lawyer-up" even more in 2012.

Apple has an opportunity to go even further: protect Apple iPhone and iPad app developers from lawsuits. An important key to the success of the PC platform was the cross-licensing that Intel and Microsoft engaged in with other large tech companies. This created a safe development environment which led to a mass of applications and devices that propelled PC popularity and reduced prices.


Topics: Apps, Apple, Enterprise Software, Hardware, Software Development

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6 comments
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  • apple is going down

    at the hands of foss
    LlNUX Geek
    • if this is the mark of failure.... Sign me up;)

      @Linux Guru Advocate ... Just saying

      Pagan jim
      James Quinn
    • RE: Apple's $100m in legal costs are tiny - expect more lawsuits in 2012

      @Linux Guru Advocate You've said that for years and yet here they are year after year making more and more money.
      athynz
  • apple pisses away money

    it's futile and foolish for apple to piss away this kind of money. innovators react to competition by further creativity; apple thinks creative _litigation_ counts.
    markhahn
  • Wow!!!

    3 posts deleted because apparently some people can't handle the truth re blatant copying and the right by some to protect their IP
    MacCanuck
  • RE: Apple's $100m in legal costs are tiny - expect more lawsuits in 2012

    From what I read, the $100 million figure only applies to the HTC action(s)?

    I read elsewhere that Samsung spent $60 million so far defending and retaliating against Apple.

    Who knows, but IMHO regardless of how much money is thrown at it, if you're wrong, you're wrong. Meaning it doesn't matter (or does it) if $100 million spent so far against HTC (only) with 84 claims, and only one sticking. What a pyrrhic victory? In the sense that whatever was deemed infringed upon, is already fixed by HTC. Meaning, no injunction. Result = zero = 0.

    What was the goal already?

    Now, that was only HTC. What about Samsung? Does anyone really believe they alone cannot repel Apple's initial attack? A diversified company the stature of Samsung? We're not talking a weakling or pushover here by any measures. And they obviously got the deep pockets and intellect to engage in a protracted defensive war against Apple. Just wait until Samsung becomes offensive...

    Oh, and Google / Motorola? Small fry too?

    Since we're only talking about Android here, what about all 84 members of the OHA simultaneously? http://www.openhandsetalliance.com/oha_members.html
    [quote]What would it take to build a better mobile phone?

    A commitment to openness, a shared vision for the future, and concrete plans to make the vision a reality.

    Welcome to the Open Handset Alliance???, a group of 84 technology and mobile companies who have come together to accelerate innovation in mobile and offer consumers a richer, less expensive, and better mobile experience. Together we have developed Android???, the first complete, open, and free mobile platform.

    We are committed to commercially deploy handsets and services using the Android Platform.[/quote]

    Methinks: At what cost?

    Well there are risks other than money after all?

    One that comes to mind is having all of Apple's patents claims legally invalidated in various jurisdictions around the world?

    Then who would be a sitting duck, without any ammo for their war machine?

    Stranger things have happened...

    Oh another risk is being completely locked out of various markets across the world, due to patent infringement of other's (non Apple) patented technologies. One can't expect to throw punches, without any strong responses after all.

    Risky business...

    [i]~~~~~~~~~~
    The man who strikes first admits that his ideas have given out.
    {Chinese Proverb}

    There is no such thing as an insignificant enemy.
    {French Proverb}

    What goes around, comes around.
    {Karma 101}

    Education's purpose is to replace an empty mind with an open one.
    ~ Malcolm Forbes, 1919-1990

    There is only one boss. The customer. And he can fire everybody in the company from the chairman down, simply by spending his money somewhere else.
    ~ Sam Walton[/i]
    WinTard