Apple's patent lawsuit ruling against Samsung is painful for the South Korean electronics brand. And while the judgment's inconsistencies virtually guarantee an appeal, access to the U.S. market for at least eight of Samsung's devices now seem to be on the chopping block. (Though many believe this will little hinder Samsung's overall future.) But that's just the U.S. market, which is not the world's biggest anymore.
Yes, of course, China. China is the largest market for cell phones and will soon be the largest market for smartphones. And who currently rules China's smartphone market? Yes, of course - Samsung!
So does Samsung have to worry about a similar fate in China?
The short answer, is probably not. Stan Abrams, of the excellent China Hearsay law blog, writes at Business Insider:
…keep in mind that patents are territorial, so if Apple wants to replicate its victory over Samsung here, it must first have the requisite patent portfolio, and then it would have to file in a Chinese court.
So no bans on Samsung devices in China, at least not for the moment. Consumers can therefore relax.
As is customary for the China market, many of the other details are hazy, or complete unknowns. As Abrams, a trademark attorney with more than a decade's business experience in China, concludes:
If you’re wondering why Apple hasn’t come after Samsung or other Android handset folks over here in China on the same grounds, you won’t get a clear explanation from me. There are way too many reasons why Apple decided to either wait or simply not go down that road at all. I don’t even know what sort of patent portfolio Apple has here, so that discussion is a bit of a non-starter.
Given the brand's history of beefing with China's filing system, it's unlikely that Apple may be preparing a massive lawsuit in China at this very moment. But one never knows. Nonetheless, this is excellent news for Samsung, which is on a tear in China.
For the first time, smartphone shipments in China eclipsed regular cells, heralding the beginning of Smartphone China. And while many Chinese Apple fans are awaiting the new iPhone, Apple saw its share of the smartphone market amount to just 10 percent.
Samsung, meanwhile, saw its market share come to rest at 19 percent.
While Samsung's share also slid, it did so by only two percent. Apple, on the other hand, saw its market chopped, slipping from second place to fourth. So while the wait for the new iPhone took a bite out of Apple, an influx of competitors also hurt what is now the world's most valued brand. As Apple preps its next model, brands such as Xiaomi are offering smartphones with as good or better features for far, far less. When Xiaomi recently launched its Mi-One, the brand sold 200,000 in less than a half hour. The phone, with a Snapdragon S4 Pro chipset and quad-core Krait processor, costs just 1,499 yuan ($241). Compare that to the iPhone's 5,000 yuan ($806) price tag. If you are a Chinese consumer facing day after day of dire, bearish news about a pending economic "hard landing," which one are you going to buy?
The other concern about the U.S. Apple ruling in China is how it will hit Chinese brands hoping to crack America's market. The ruling, Abrams writes, "certainly calls into question the strategies of companies that have built Android devices 'inspired' by the iPhone."
One of China's leading handset brands, ZTE, is, at least publicly, "unfazed." As ZTE's handset division VP, Luo Zhongsheng, told Reuters, "We're not worried about it. As a listed company we're very careful when it comes to our phone designs to make sure we don't violate any patents."
Mmhhhmm. Whatever you say, Mr. Luo.
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