When Declining To Enforce Your Intellectual Property Rights Strengthens Your Market Position

from the well,-quite-often dept

Wed, Jan 20th 2010 6:57am — Mike Masnick

Over the years we've shown many examples of times when it makes much more business sense not to enforce your intellectual property rights, but reader Jerry Leichter sends in another example. It discusses how Apple is benefiting from not going after those who copy its iPhone UI, suggesting that Apple's aggressiveness in such lawsuits with PCs helped Microsoft win the personal computer war in the 80s and 90s:

The more different competitors Apple faces in smartphones, the better it fares. One major reason why Apple lost its pioneering position in graphical desktop PCs to Microsoft in the 90s was related to the company's efforts to stamp out rivals in "look and feel" lawsuits during the late 80s that shut down windowing products from HP and GEM, leaving Microsoft free rein to consolidate a competitive-free monopoly juggernaut around its own Windows product.

In this decade, Apple has conspicuously refrained from attacking rivals on copyright or patent infringement issues in both the iPod and iPhone markets, outside of defensive measures it has taken against patent challenges from Creative and more recently Nokia. Competing in the market has historically worked out much more successfully for Apple than trying to compete in court.

I think it's a good point -- and accurate that Apple is better off not enforcing its IP, and that Microsoft was helped by Apple's mistake last time around, but I doubt that's why Apple isn't doing it this time around. My guess is that the reason it didn't bother this time was because it lost so badly when it tried to go after Microsoft for copying the "Windows" look and feel. Still, it is a good example where sometimes it really does help to have more people recognize your user interface -- even if sometimes they're using it from someone else.

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Filed Under: business models, enforcement, intellectual property, market position
Companies: apple, microsoft

29 Comments

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The Mad (Patent) Prosecutor, 20 Jan 2010 @ 8:14am

Show me the proof - oh wait, there is none.
Or, maybe, Apple's earlier efforts saved the company. Maybe Apple would have disappeared entirely had they not been aggressive in the 80s and early 90s.

As long as we're making up unsupported assertions, maybe Apple caused global warning (or wait, are we back to predicting global cooling - check your PopSci from the 80s and 90s, when cooling was the fear du jour).

The point is, we can all make up sensible sounding statements to support our positions. Why anyone would believe Jerry's assumptions, when there is no proof either way, over my assertions, well that's simply each reader looking for the "proof" he wants to support his case.
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Hephaestus (profile), 20 Jan 2010 @ 8:18am

Re: Show me the proof - oh wait, there is none.
Just a guess ... you practice Patent Law
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bdcrazy, 20 Jan 2010 @ 8:21am

Current Events
Apple and Nokia are currently in a patent tif over the iPhone. How does this affect your current statements?
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Comboman (profile), 20 Jan 2010 @ 8:40am

Ask Psystar
Ask Psystar if Apple is no longer aggressively enforcing their IP! They may be a little more selective in choosing their battles these days, but don't think for a minute they wont sue you if they think there's a good chance they can win.
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Save CoCo, 20 Jan 2010 @ 8:58am

um, how the hell does this guy make the leap in logic that Apples IP policy of the 80's was why the OS did not become the de facto standard? It has been studied and analyzed to death.

The difference maker was that MS licensed it's os to OEM computer manufactures and Apple chose to maintain complete control of the whole platform (good call in my view) So now MS owns the market for the desktop os.
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McCrea, 20 Jan 2010 @ 9:13am

Re: Show me the proof - oh wait, there is none.
I thought Microsoft bailed Apple out. I do not think Apple's efforts saved the company.
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Anonymous Coward, 20 Jan 2010 @ 10:20am

Re:
Yeah, I doubt Apple was any real factor in helping Microsoft gain such a huge marketshare during that period. Was Apple also to blame for DOS's dominance?
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sean, 20 Jan 2010 @ 10:27am

you guys haven't noticed that the tech dirt staff do not believe in intellectual property?

they think everything should be free, as long as its good for the collective.

isn't that true comrade Masnick
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Mike's Wrong Again, 20 Jan 2010 @ 10:29am

Like the other comments pointed out, you have no proof, and the gaps in the original author's conclusions do not reflect what actually happened.

1) Apple is as litigous as ever in protecting their IP.
http://en.wikipedia.org/wiki/Apple_lawsuits
2) Apple never lost its position as a pioneer in graphical user interfaces due to lawsuits. It lost it due to offering a higher priced product (Lisa was $9,995, similar IBM-PC 5150 was $3,005) even though the lower priced product didn't have a GUI.
3) Let's pretend Apple was as open as their only real competitior at the time - IBM. IBM built a much more open hardware platform. IBM's BIOS was cloned and their subcontractor for the OS was allowed to have an open license. IBM's PC DOS died an early death and IBM is now completely out of the PC hardware business that they pioneered. Apple at least survived and now is doing well.
4) Microsoft was just as litigous as Apple and succeded for many reasons, among those stated by other responders as well as protecting their IP by copyrights, patents, and acquisitions.
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Mike Masnick (profile), 20 Jan 2010 @ 10:44am

Re: Current Events
Apple and Nokia are currently in a patent tif over the iPhone. How does this affect your current statements?

It's mentioned in the post. In that case it was a defensive use. Nokia sued first, so Apple sued back. Same with the case of Creative.
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Mike Masnick (profile), 20 Jan 2010 @ 10:49am

Re:
they think everything should be free, as long as its good for the collective.

Bizarre. In another thread I'm accused of being a lackey for big business, and in this thread I'm accused of being a communist who wants everything for free.

I guess when you have no actual argument, you just start calling people names.

For the record (which I thought was clear, except I guess, if you don't want to read), I do not believe that everything should be free, and I have no idea what "the collective is" nor do I care.

I am only explaining the economics of what actually happens, and how to take advantage of it to make more money. I don't see how that's communist in any way. Seems like the opposite.
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Anonymous Coward, 20 Jan 2010 @ 10:51am

Re: Re: Show me the proof - oh wait, there is none.
microsoft corporation and management personnel currently own about 30% of Apple. They did this to "save" Apple and to prevent monopoly lawsuits if Apple failed. Since there is an Apple there is no Monopoly.
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Mike Masnick (profile), 20 Jan 2010 @ 10:51am

Re: Show me the proof - oh wait, there is none.
The point is, we can all make up sensible sounding statements to support our positions. Why anyone would believe Jerry's assumptions, when there is no proof either way, over my assertions, well that's simply each reader looking for the "proof" he wants to support his case.

Wasn't Jerry's assertions (reading comprehension is your friend), first of all.

But, more importantly, there is some evidence to back up the claims if you look at them. Even Microsoft has admitted that its decision not to enforce its IP rights early on helped establish it as a standard.

No one said it was *the* reason why things worked out the way they did, but the point is that it was likely one of the factors that helped Microsoft -- and it certainly looks like Apple is recognizing that in some way now in the fact that it hasn't sued others over look and feel.
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Mike Masnick (profile), 20 Jan 2010 @ 10:52am

Re: Ask Psystar
Ask Psystar if Apple is no longer aggressively enforcing their IP! They may be a little more selective in choosing their battles these days, but don't think for a minute they wont sue you if they think there's a good chance they can win.

Two points on this. (1) That is basically what I said in the article (I don't think that Apple didn't sue over look and feel because it recognizes the business advantage, but because they lost the last time they tried).

(2) No one said that Apple doesn't enforce it's IP. This article was about the specific circumstance of enforcing IP over look and feel of its interface.
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Mike Masnick (profile), 20 Jan 2010 @ 10:56am

Re:
Mike's Wrong Again

Funny. Reading comprehension time. You are disagreeing with the part that I quoted -- and then explained why I didn't think it was true.

So what you are really saying is that I am right. That the claim in that article I linked to may go a bit too far -- which is exactly what I said. But instead, you use it to claim I'm wrong. Weird.

1) Apple is as litigous as ever in protecting their IP.

Indeed, but as I already pointed out (and I thought was clear from the article) this is talking just about UI look and feel stuff -- and there Apple has held back on lawsuits over the iPhone. Which is what the article says and is not disproved by your link.

2) Apple never lost its position as a pioneer in graphical user interfaces due to lawsuits. It lost it due to offering a higher priced product (Lisa was $9,995, similar IBM-PC 5150 was $3,005) even though the lower priced product didn't have a GUI.

That wasn't the claim either. The point was that there were multiple factors, and the fact that Windows became a de facto standard played into that.

3) Let's pretend Apple was as open as their only real competitior at the time - IBM. IBM built a much more open hardware platform. IBM's BIOS was cloned and their subcontractor for the OS was allowed to have an open license. IBM's PC DOS died an early death and IBM is now completely out of the PC hardware business that they pioneered. Apple at least survived and now is doing well.

Again, no one claimed it was the only factor.

4) Microsoft was just as litigous as Apple and succeded for many reasons, among those stated by other responders as well as protecting their IP by copyrights, patents, and acquisitions.

Again, no one said that any of this had to do with all IP -- just the specific case of UI look and feel IP.
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sean, 20 Jan 2010 @ 11:59am

the title of your next article should be: How to insult your readership, and lose your job. i see headlines from techdirt constantly that put down businesses for trying to protect their IP, and hating on artists for not wanting their music pirated. so, go on, continue to bash the readership. see how long you get to hang around.
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sean, 20 Jan 2010 @ 12:08pm

and, if no one believes that you are anti IP, just read through some of these. http://techdirt.com/search.php?q=Intellectual+Property+&tid=&aid=mmasnick&sear chin=stories
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What???, 20 Jan 2010 @ 12:42pm

Re: Re:
"I think it's a good point -- and accurate that Apple is better off not enforcing its IP, and that Microsoft was helped by Apple's mistake last time around, but I doubt that's why Apple isn't doing it this time around. My guess is that the reason it didn't bother this time was because it lost so badly when it tried to go after Microsoft for copying the "Windows" look and feel. Still, it is a good example where sometimes it really does help to have more people recognize your user interface -- even if sometimes they're using it from someone else."

So, when you say 'that's a good point - and accurate' you mean 'I disagree with it and it's inaccurate'
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JEDIDIAH, 20 Jan 2010 @ 1:49pm

Re:
Apple also sued anyone that might have been a competitor to Microsoft on it's own turf. They essentially took a nearly impossible job and made it even harder. They also managed to help stifle entirely alternate platforms (like the ST and Amiga).
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disagree with sean, 20 Jan 2010 @ 2:09pm

Re:
I think he does that on purpose - by disagreeing, by insulting, by making these unsubstantiated, sweeping allegations he has made me a reader over the past couple days.

It's like when market reports about Howard Stern turned up the fact that almost half his listeners hated him, but wanted to listen to see what stupid thing he'd say next.
I'm sure it will get boring after awhile, but a college grad that distorts the facts is AMAZING!

I find Mike completely

* Ignorant of IBM's demise in the PC business (directly attributed to their openness)

* Ignorant of Apple's current lawsuits (starting with the look and feel lawsuits specifically)
http://www.spotlightingnews.com/article.php?news=3405
http://www.theregister.co.uk/2 001/02/02/apple_rattles_lawyers_at_desktopx/
http://www.theregister.co.uk/2000/01/14/windows_skin_s ite_reposts_macos/
http://www.macblogz.com/2009/02/02/apple-sues-german-website-over-misuse-of-ipho ne-imagery/
http://www.techspot.com/news/37141-apple-sues-clone-power-adapter-manufacturer.html
ht tp://forums.macrumors.com/showthread.php?t=101518
http://www.macworld.com/article/50929/2006/05/law suit.html
http://iphonefreakz.com/2008/12/12/apple-sues-school-for-logo-copyright/

* Ignorant of the results of the Apple v. Microsoft lawsuit. In fact, the Apple/Windows lawsuit and the resulting negotiations kept Apple alive by forcing Microsoft to keep making Word and Excel for Apple - two of the biggest reasons why Apple lost market share prior to the lawsuit. That's very surprising that Mike didn't know that, since it was only 13 years ago. Then again - that's when he was in college learning.

So, in summary, Apple does now and always has enforced its IP.

p.s., the collective is a specific reference to the Borg from Star Trek: The Next Generation.
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Mike Masnick (profile), 20 Jan 2010 @ 2:58pm

Re:
i see headlines from techdirt constantly that put down businesses for trying to protect their IP, and hating on artists for not wanting their music pirated. so, go on, continue to bash the readership. see how long you get to hang around.

Readership keeps growing -- thanks very much.

But, no we don't bash individuals or businesses -- only the stupid ideas they put forth and we explain why they are stupid.
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Mike Masnick (profile), 20 Jan 2010 @ 2:59pm

Re:
and, if no one believes that you are anti IP, just read through some of these.

Indeed. It's no secret that I believe IP does more harm than good. That's not a surprise -- not sure why you imply it is.

But you claimed, falsely, that I said everything should be free. I did not. You claimed, falsely, that I said that what's good for "the collective" is most important. You claimed, falsely, that I supported communism.

Tough to take you seriously when you can't get your basics straight.
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Mike Masnick (profile), 20 Jan 2010 @ 3:02pm

Re: Re:
I think he does that on purpose - by disagreeing, by insulting, by making these unsubstantiated, sweeping allegations he has made me a reader over the past couple days.

Thanks for joining -- though, no, I only insult those who are making baseless statements themselves. I very much work on substantiating my ideas. Since you've just joined us, perhaps it would help to surf around a bit.

* Ignorant of IBM's demise in the PC business (directly attributed to their openness)

Ha! You might want to try substantiating that, because it's so wrong it's laughable.

* Ignorant of Apple's current lawsuits (starting with the look and feel lawsuits specifically)

Fair enough. Though, again, it was not *I* who made the original argument, and even explained why I didn't think the argument made was true. So I'm not sure why you continue to attribute that argument to me.

So, in summary, Apple does now and always has enforced its IP.

Except that it has not sued many many providers of similar UIs. So, no, not "always." But, you know... details.
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BetterFan, 20 Jan 2010 @ 4:14pm

I think some of you need to stop reading a blog written by a guy you obviously disagree with and feel the need to correct. Mike writes great articles, I come here to find interesting tech stories and see what the rest of the community has to think. This flamer/troll mentality is really quite unbecoming.

To the point, I think Apple has done a good job not defining itself by big lawsuits this time around. They're defined more by the close knit community that uses their products, and how much they've managed to profit from incubating that customer relationship. Microsoft is trying hard to emulate that model.
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alternatives(), 20 Jan 2010 @ 5:54pm

Re: Re: Show me the proof - oh wait, there is none.
I thought Microsoft bailed Apple out.

They did. It was the strong IP of Applesoft BASIC (from Microsoft) that put an end to the Apple ][ cloning market.

Both IBM and Apple felt the clones hurt them.
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The Rest of the Community, 21 Jan 2010 @ 6:54am

Re:
You don't want anyone to disagree with Mike.

You want to see what the rest of the community has to think.

So, a little inductive proof means that -

The Entire Community of People That Agree with Mike Completely Agree With Mike!!!

I'm in the wrong place.

To the point, Apple has several big lawsuits currently, the close knit community isn't close, and they have a horrid customer relationship issue with their new products (iPod batteries, remember?, lack of iPhone on any net but the poor AT&T, products that cause fires). You're confusing marketing image with customer relationship.

Microsoft is not emulating that model (if by that model you mean their model for Macs - which was a close knit community). Microsoft is going for market share by appealing to a certain price point while fending off "free" and "overpriced."

SGI was trying to emulate that model. Intergraph was trying to emulate that model (both still alive after not trying to emulate that model anymore).
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johnn Peterson, 27 Jan 2010 @ 1:48am

[I think it's a good point -- and accurate that Apple is better off not enforcing its IP, and that Microsoft was helped by Apple's mistake last time around, but I doubt that's why Apple isn't doing it this time around. My guess is that the reason it didn't bother this time was because it lost so badly when it tried to go after Microsoft for copying the "Windows" look and feel. Still, it is a good example where sometimes it really does help to have more people recognize your user interface -- even if sometimes they're using it from someone else.]

How it is..
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Newbie too, 2 Mar 2010 @ 7:29pm

Maybe the HTS patent suit is part of the strategy in the Apple/Nokia fight. Apple needs to maintain that its patents have monetary value that can stand up to Nokia patents.
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Newbie too, 2 Mar 2010 @ 7:37pm

BTW , I was talking about the HTC lawsuit not HTS.
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