Samsung

In July, a 10K filing showed that Apple acquired security company AuthenTec for $356 million. At the time, we noted Apple was presumably after the company’s various fingerprint-related technologies, while companies such as Samsung, Motorola, and others entered in deals with AuthenTec for its secure VPNs, encryption algorithms, and security-related products. Today, NFCWorld (via TechCrunch) reported Authentec has now sold its embedded security solutions division to NFC company Inside Secure. The sale would seem to indicate that Apple was indeed specifically after the company’s fingerprint and NFC solutions:

The sale suggests that Apple’s interest in acquiring Authentec lies with the company’s innovative combined fingerprint and NFC solution, which is not part of the division being acquired by Inside Secure, and will lead to renewed speculation that Apple will include NFC in future iPhones and other devices…. NFC and contactless chip provider Inside Secure is to acquire the embedded security systems division of Authentec, the fingerprint and secure solutions specialist which Apple agreed to buy for US$356m in July 2012. The transaction is valued at up to US$48m.

To get a hold of AuthenTec’s Embedded Security Solutions Division, Inside Secure will reportedly pay $38 million in cash and another $10 million “subject to completion of certain post-closing transactions.” Products the division is responsible for are currently used in hundreds of millions of mobile and networking devices worldwide, with customers ranging from Samsung, Nokia, LG, and Motorola to HBO, Cisco, and Texas Instruments. Last year, the division brought in sales of $25.3 million.
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Worldwide Mobile Device Sales to End Users by Operating System in 3Q12

Gartner is out with its quarterly report for worldwide mobile device sales by vendor and OS for the third quarter. While reporting an overall 3 percent decline in mobile phone sales, the smartphone category hit 169.2 million units in Q3, a 47 percent increase from the year-ago quarter. While Apple is still third to Samsung and Nokia for total mobile device sales, Samsung and Apple remain the top smartphone vendors collectively, capturing 46.5-percent of the market. Meanwhile, Nokia slipped from No. 3 smartphone vendor in Q2 to No. 7 in Q3. This made room for RIM and HTC behind Apple and Samsung in the third and fourth positions.

With sales of 23.6 million units in the third quarter for Apple (up 36.2-percent year-on-year), Gartner reported Samsung widened its lead on Apple with almost 55 million smartphones in the quarter and strong demand for its Galaxy line. Samsung once again takes the top vendor position for smartphones with 32.5-percent of the market:

Samsung’s mobile phones sales continued to accelerate, totaling almost 98 million units in the third quarter of 2012 (see Table 1), up 18.6 percent year-on-year. Samsung saw strong demand for Galaxy smartphones across different price points, and it further widened the gap with Apple in the smartphone market, selling 55 million smartphones in the third quarter of 2012. It commanded 32.5 percent of the global smartphone market in the third quarter of 2012.

As for the race between Android and iOS, Gartner’s numbers show Android increased its marketshare nearly 20 percentage points in the quarter to 72.4-percent of the market, up from just 52.5-percent in the year-ago quarter. In comparison, Apple now accounts for 13.9-percent of the market, down from 15 percent last year, but Gartner expects that to change in Q4 thanks to the continuing iPhone 5 roll out:

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Following the $1 billion verdict in the Samsung vs. Apple case, Samsung has been attempting to get the courts to investigate juror Velvin Hogan. It claimed Hogan “concealed information” about his past history with Seagate, a company Samsung is now a shareholder in. CNET reported Federal District Judge Lucy Koh will consider Samsung’s claims in a hearing set for Dec. 6. At the heart of the allegations is whether Hogan disclosed that his former employee Seagate had previously sued him:

As part of her inquiry, Koh said she will require Apple to disclose what information the company’s lawyers knew about the jury foreman…Samsung argued that jury foreman Velvin Hogan didn’t disclose during jury selection that he had been sued by Seagate, his former employer. Samsung pointed out in court papers that Seagate and Samsung have a “substantial strategic relationship.” The litigation with Seagate led Hogan to file for personal bankruptcy in 1993. Samsung maintains Hogan should have informed the court about the case.

The Register reported today that Apple called Samsung’s argument a “convoluted theory,” adding it was Samsung responsibilities to interview jurors members during jury selection:
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Apple allegedly plans to one-day abandon Intel to implement a version of chips into Macs that currently power its mobile devices.

Bloomberg first reported the story, citing “people familiar with the company’s research,” and said Apple believes mobile device chips will eventually run its computer lineup. Apple previously mentioned semiconductor development during its management shift announcement on Oct. 29.

Bob Mansfield, senior vice president of Apple’s new “Technologies” group, is apparently leading the chip research, and Apple specifically said its semiconductor teams have “ambitious plans for the future.”

The Cupertino, Calif.-based company first began using Intel processors for Macs in 2005, but two of Bloomberg’s sources noted Apple would continue to rely on the tech for at least a few more years:

As handheld devices increasingly function like PCs, the engineers working on this project within Apple envision machines that use a common chip design. If Apple Chief Executive Officer Tim Cook wants to offer the consumer of 2017 and beyond a seamless experience on laptops, phones, tablets and televisions, it will be easier to build if all the devices have a consistent underlying chip architecture, according to one of the people.

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[youtube=http://www.youtube.com/watch?feature=player_embedded&v=pHuoDqcIyqk]

Google is making some big product announcements today, despite having to cancel its event due to Hurricane Sandy. Among the announcements: a new Nexus smartphone from LG, a Samsung-built Nexus 10 tablet, and updates to Google’s 7-inch Nexus 7 lineup.

LG Nexus 4: Google is launching the much-rumored LG Nexus 4 on Nov. 13 starting at $299. Much of the specs were confirmed previously, but Google has interestingly decided to not offer an LTE-capable model of the device. It is, however, including a wireless charging dock. T-Mobile is Google’s premier launch partner for the Nexus 4. Full specs on 9to5Google.

Samsung Nexus 10: Clearly, Google’s iPad competitor, its new 10-inch offering, is a Samsung-built tablet that packs in iPad-like specs starting at $399. The Verge said its 10-inch 2,560-by-1,600-pixel resolution (same as 13-inch Retina MacBook Pro) display is “on par with the iPad’s Retina display, with sharp text, excellent color fidelity, and great viewing angles.” Full specs and more here.

Nexus 7: Google has also confirmed today that its 7-inch Nexus 7 lineup is being refreshed. Google’s iPad mini competitor will now start at $199 for 16GB, and it will offer a 32GB model for $249. Those are both Wi-Fi-only, but Google will also offer an HSPA+ 32GB model for $300, $30 less than Apple’s entry-level iPad mini. The 8GB model is gone. That 32GB HSPA+ Nexus 7 is going up the bigger iPad mini that starts at $329.

Head over to 9to5Google.com for more coverage of Google’s leaked product announcements. Oh, and Microsoft is launching Windows Phone 8 as well.

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Last week, Apple lost an appeal in the U.K. that forced Apple to apologize to Samsung publicly and state that its Galaxy Tab does not infringe on Apple’s patents.

Britain Court of Appeal upheld a previous ruling that Samsung’s Galaxy Tab does not infringe on the iPad’s patents because it is not “as cool.” Reuters reported that after losing the appeal this morning, Apple has been instructed by the court to apologize to Samsung by running ads on its website and in newspapers saying Samsung did not infringe on patents in at least Arial 14 font.

Hidden at the bottom of Apple’s U.K. website this morning is the required link to the apology, but the apology is more like one your big sister would give you after being reprimanded by your parents. After mentioning Samsung did not infringe, Apple nicely sliced out some complimentary quotes from the ruling:

“The extreme simplicity of the Apple design is striking. Overall it has undecorated flat surfaces with a plate of glass on the front all the way out to a very thin rim and a blank back. There is a crisp edge around the rim and a combination of curves, both at the corners and the sides. The design looks like an object the informed user would want to pick up and hold. It is an understated, smooth and simple product. It is a cool design.”

Apple goes on to say German and U.S. courts ruled otherwise.

However, in a case tried in Germany regarding the same patent, the court found that Samsung engaged in unfair competition by copying the iPad design. A U.S. jury also found Samsung guilty of infringing on Apple’s design and utility patents, awarding over one billion U.S. dollars in damages to Apple Inc. So while the U.K. court did not find Samsung guilty of infringement, other courts have recognized that in the course of creating its Galaxy tablet, Samsung willfully copied Apple’s far more popular iPad.

So there!
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Apple and Samsung’s legal fight continued on the world stage this morning, where the Britain Court of Appeal upheld a previous ruling that Samsung’s Galaxy Tab does not infringe on the iPad’s patents because it is not “as cool.” Reuters reported that after losing the appeal this morning, Apple has been instructed by the court to apologize to Samsung by running ads on its website and in newspapers saying Samsung did not infringe on patents in at least Arial 14 font.

As we all know, other courts around the world have ruled otherwise. On the ruling, Samsung gave the boilerplate: “We continue to believe that Apple was not the first to design a tablet with a rectangular shape and rounded corners.” A California court ruled this summer that Samsung owes $1 billion to Apple. Additionally, some of Samsung’s devices could be in jeopardy from being on the market.

Today’s ruling in Europe prohibits any other legal course regarding tablets and the iPad specifically. While the Court of Appeal denied Apple’s appeal today, the company can still appeal with the Supreme Court. The global legal battle is far form over, as it continues in roughly a dozen countries, with more trials scheduled for 2014. 
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Just before we heard Apple was not using an ARM-designed processor and instead its first custom CPU design for the new iPhone’s A6, we also heard reports that Apple was reducing component orders from Samsung due to the two companies’ ongoing patent disputes. While we knew Samsung was still—at the very least—manufacturing the new chip, a report from KoreaTimes gives more insight into the company’s involvement directly from a Samsung official. According to the report, the A6 is the first of Apple’s iPhone chips where Samsung did not contribute to development of the technology:

According to industry sources, Apple has not collaborated with Samsung in the process to develop its A6 microprocessor used in its latest iPhone 5. Samsung has handled the manufacturing of the processors used in previous iPhones and believed to have contributed in their design to some degree… It now appears that the structure of the deal has been dramatically adjusted…Apple is still relying on the Korean firm to manufacture its chips but has made it clear it will no longer use its rival’s technology.

We heard conflicting reports in September regarding Apple’s decision to reduce component orders from its biggest supplier, Samsung. Reuters claimed the reduction in orders was an attempt to simply “widen its supply chain,” while others reported Apple is actively reducing orders of displays, memory chips, and batteries specifically due to increasing tension between the companies. According to the report’s source, an unnamed senior Samsung official, Samsung is now only manufacturing the A6 chips on a “foundry basis”:

“There are three kinds of chip clients. Some want us to handle everything from chip design, architecture and manufacturing. Some want us to just design and manufacture. Some want us to just make the chips. Apple is now the third type,’’

Related to today’s report: Apple’s recent hiring of Samsung chip designer Jim Mergard. The report claimed the hiring of Mergard, who was working specifically on ARM chip designs at Samsung and prior, increases the “mutual tension”…
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