Wednesday, August 23, 2006

Apple Settles With Creative Out Of Court And Then It Gets Weird

As reported by ENgadget

Apple and Creative settle, Apple forks out $100m

As some may well remember, not even four months ago Creative filed suit against Apple for violating their "Zen patent," which pertained to a hierarchical menu system for portable media players; Apple countersued Creative, and then in the true Jobsian style of raining down on his foes, launched a second suit pertaining to icons and data display and entry in such portable devices. (Apparently two other suits also went down behind the scenes.) Guess those didn't work too well, as today Apple announced they'd be handing over $100,000,000 US (would you look at all those zeroes?) to Creative to license the "technology" outlined in the Zen patent -- the exact amount Creative pledged to spend on advertising against the iPod in 2005. It also looks like Apple scored a deal wherein they'll recoup some of those costs if and when Creative leverages the patent on other media player companies. But perhaps the most bizarre bit of all, Creative seems to be jumping right into bed with Apple now that their spat's over, and is now officially a Made for iPod program partner with iPod accessories expected this year.

... gotta love the vaguely optimistic spin Jobs put on the [settlement]: "Creative is very fortunate to have been granted this early patent..."

I don't even know what to say here ... hopefully Gruber will detail this in anal detail.

[UPDATE]From MacMinute:

"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."

"We're very pleased to have reached an amicable settlement with Apple and to have opened up significant new opportunities for Creative," said Sim Wong Hoo, chairman and CEO of Creative. "Apple has built a huge ecosystem for its iPod and with our upcoming participation in the 'Made for iPod' program we are very excited about this new market opportunity for our speaker systems, our just-introduced line of earphones and headphones, and our future family of X- Fi audio enhancement products. We expect that the one-time licensing payment of $100 million will contribute approximately $.85 of earnings per share to our current quarter, ending September 30, 2006."


Anonymous said...

How does the saying go?

Keep your friends close and your enemies closer?

Sounds about right here.....

FYT said...

Good point and pertinent to this week's articles on Fix Your Thinking.