Consumer electronics giant Apple successfully sued rival Samsung this week over smartphone patents, driving market shares to a new high and compelling Samsung to pay $1 billion in damages. The lawsuit is far from over, of course. Samsung will appeal the decision, since any legal defense is better than a $1 billion dollar payout, but many legal analysts believe that Apple will win the appeals as well.



The battle was important because, depending on your point of view, Apple was either defending its patent rights or aggressively using its overabundance of patents to attack a competitive rival. Although Apple makes more money than any other smartphone developer, Samsung has a bigger market share. If Samsung cannot successfully defend itself, the company might not be able to innovate. We might see Samsung smartphones lose some of their most intuitive features, although Samsung might also swing back with major innovations or even a few patent lawsuits of their own.


More importantly, the lawsuit could be the beginning of the end for the Android platform. If Apple continues to successfully argue that Google’s Android OS copies features from the iPhone’s iOS, Android will need to change dramatically in order to compete.


It all sounds like good news for Apple, and investors certainly seem to think so. However, there’s a dark cloud inside of Apple’s silver lining. The decision adds fuel to the fire of Apple detractors who claim that the consumer electronics company uses patents defensively to stifle competition unfairly.


Apple’s reputation has taken a few shots in recent years. Controversy over the company’s manufacturing practices led some analysts to accuse Apple of poor business ethics, and if consumers start to believe that the company has a monopoly, there could be major repercussions. Apple will need to monitor developments closely, but for now, the company is enjoying massive stock values thanks to the court’s decision.