Apple Sues Creative

boarder8925 writes "Apple is counter-suing Creative, claiming it has infringed 'four patents in its handheld digital players.' The suit was filed the same day that Creative filed suit against Apple. 'Creative proactively held discussions with Apple in our efforts to explore amicable solutions,' a spokesman for Creative said. 'At no time during these discussions or at any other time did Apple mention to us the patents it raised in its lawsuit.'"

Comments

Summary: Creative says "Waaaaaaaah"

[Whiney Mac Fanboy]

Quoting the summary:

'Creative proactively held discussions with Apple in our efforts to explore amicable solutions,' a spokesman for Creative said. 'At no time during these discussions or at any other time did Apple mention to us the patents it raised in its lawsuit.'

Waaah! Waaah! Waaaah!

What were creative thinking? That they'd get some sympathy? Play with patent fire & you're going to get burnt.

And frankly, I think Apple & Creative should be more worried about this patent then each other.

Mildly interesting to see what's happened to Apple and Creative's stock since the two announcements (looks like Apple's lost ~4% & Creative ~2.5%).

*Sighs* such a pity to see two companies that employ so many talented people wasting their time like this.

Re:Summary: Creative says "Waaaaaaaah"

[Thrudheim]

It seems to me that Apple, in contrast to the opinion of some, has priced the iPod very competitively. Creative is losing a ton of money by trying to maintain slightly cheaper prices for its competing lines. In some cases, actually, the iPod is priced just the same or slightly less. It is a losing battle for Creative because they do not have the economy of scale that Apple has with the iPod, so they lose money at these prices while Apple does well. In this case, Apple has a Dell-like supply chain.

This article, from over a year ago, says it all: "Creative Responds to iPod Price Drop." Apple took the offensive by cutting prices, and it has continued this strategy. As an analyst in the article says, "Apple has left little room for other music vendors to compete on price." Creative followed that strategy nevertheless, and the results are very clear: Creative cannot sustain a price battle with Apple and stay in business. Their third-quarter sales fell to $225.7 million compared to $333.8 million for the same quarter the previous year. Their net loss for the quarter was $74.7 million. For the past three quarters, it was $105.4 million.

Simply put, Creative is in serious financial trouble. The recent legal action against Apple smacks of a desperate strategy to use their trump card -- their GUI patent -- to shore up their finances. Their problem is that this patent is being challenged and there is a very good possibility that it will not stand. A hierachical system for organizing a music library is just too obvious to be the intellectual property of any one company. Apple has the legal team to drag out the process as long as possible. Their countersuit is just the first step in this process.

Re:Brain ..... Hurting....

[ajakk]

In the United States (and definately not Europe), there are several ways that the public use of a product can be prior art to a patent. First, if the prior art conceived of before you conceived of your invention, then you cannot get a patent on it (who came up with the idea first). Second, if the invention was publicly used more than one year prior to the date of your patent application, then you are barred from getting a patent (regardless of who invented it first). Thus, in the case of Microsoft, they could argue that they conceived of the invention before Apple did, and that they iPod was not in public use (or on sale) more than one year before they filed their patent application.

The law that describes what qualifies as prior art is 35 U.S.C. 102.