Wed, 23 Aug 2006

Apple's $100 Million IPod Payout

I have a Creative Nomad, and I also own an iPod. I can assure you that there's very little similarity between them - the iPod is simply the superior device, hands down. On the iPod you navigate using a wheel, on the Nomad, it's via buttons. About the only thing in common is the hierarchical structure of the collection: and if that doesn't qualify as "obvious" I don't know what does.

Note the comment by Steve Jobs:

"Creative is very fortunate to have been granted this early patent," said Steve Jobs, Apple's CEO. "This settlement resolves all of our differences with Creative, including the five lawsuits currently pending between the companies, and removes the uncertainty and distraction of prolonged litigation."

This is the business logic that drives the patent system - it was cheaper for Apple to settle for $100 million than to litigate five lawsuits on three continents and win. It's simply cheaper to pay the blackmailer than to fight.

Of course, this doesn't always have the intended effect: sure Apple gets off the hook for less cash right now. But I can assure you that scads of "intellectual property" lawyers are sharpening their pens right now, and arranging patents on the most dubious of inventions for the sole purpose of shaking down the rest of the market.

And in perhaps the most ironic effect of all: some of them are undoubtedly working for Apple.

It's a big payday for Creative Technology as Apple agrees to pony up a pile of cash to settle patent-infringement lawsuits.

(link) [Wired News: Top Stories]

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