A blogger uncovers the $2 billion dispute behind Friday's bizarre back and forth
Source: FOSS Patents
Apple (AAPL) watchers were shocked Friday when the company, in response to a court-ordered injunction, removed the iPhone 4 and 3GS from its online Apple Store in Germany.
The injunction was suspended before the end of the day -- and the products restored -- but the bizarre incident left analysts and investors wondering what the hell was going on.
FOSS Patents' Florian Mueller thinks he's found the answer in an obscure legal brief filed in late January by Apple in the Southern District of California. The brief reveals -- perhaps inadvertently -- something that is usually a closely guarded industry secret: the terms of a royalty agreement to license a key piece of patented technology.
Apple needed the technology. Motorola (MOT) owned it. And it was asking, according to the document Mueller discovered, 2.25% of Apple's iPhone sales up to and including the iPhone 4.
According to Apple's SEC filings for fiscal years 2007 through 2011, revenue from those iPhone sales totaled $92.64 billion, of which Motorola seemed to be demanding a $2.08 billion cut.
It's unclear, says Mueller, whether this covered just one patent or all of Motorola's so-called standards-essential intellectual property but, he writes, "the amount still seems excessive to me."
Apple apparently agrees, and it has filed a series of discovery motions aimed at finding out how much Motorola charged Nokia, HTC, LG and Ericsson for the same technology.
If Motorola was trying to squeeze more out of Apple than its competitors, it could be in trouble. The patent in question is covered by the so-called FRAND rules. These require that technology that has become part of an industry standard be licensed under terms that are "fair, reasonable and non-discriminatory." Samsung is currently being investigated by the EU for just such an alleged FRAND violation.
Apple forced to pull older iPhones off its online store, faces an injunction on push e-mail
Yanked from the virtual shelves
UPDATE: Sales of Apple's iPhones resumed Friday. See here.
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It was a crazy day for Apple (AAPL) in Germany.
First it removed the iPhone 4 and 3GS from its German online store -- the first time, as far as we know, that the company has been forced to stop selling MORE
Philip Elmer-DeWitt - Feb 3, 2012 10:56 AM ET
Who are the 1% who are sucking up half the world's cellular bandwidth?
Data: Arieso. Chart: PED
It's tempting to blame -- as many headline writers have -- Apple's (AAPL) newest iPhone and its voice-activated personal assistant for the fact that 3% of mobile users now consume 70% of the world's bandwidth, up from 40% in 2009.
After all, the iPhone 4S with Siri consumes nearly twice as much data as the MORE
Philip Elmer-DeWitt - Jan 6, 2012 7:16 AM ET
Apple is selling iPhones as fast as it can make them, but that may not be fast enough
Chinese queue up for iPhone 4S. Photo: iWorld
A pair of analyst reports Tuesday warn that Apple (AAPL) may be having trouble feeding the demand for iPhones in advance of the holiday selling season.
In a note entitled "Limited near-term upside for iPhone," Rodman & Renshaw's Ashok Kumar alerted clients that low yields on an MORE
Philip Elmer-DeWitt - Nov 29, 2011 6:59 AM ET
Apple's latest gadget sets a new launch weekend record
L.A.'s Century City Apple Store on Saturday afternoon. Photo: Howard Kaplan
Apple (AAPL) announced Monday that it sold more than 4 million iPhone 4S units between 8 a.m. Friday and 12 midnight Sunday.
That's 135% better than the launch of the iPhone 4 in June 2010, and better than any analyst had predicted. The average estimate among the few who had ventured a MORE
Philip Elmer-DeWitt - Oct 17, 2011 10:18 AM ET
Analysts have published estimates ranging from 2 to 4 million. What's your guess?
iPhone 4S queue in Covent Garden, London. Photo: Matthew Lloyd/Bloomberg
UPDATE: We have a winner. Apple announced Monday that the correct answer was "over four million," the guess of nearly 23% of our readers.
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When the iPhone 4 went on sale 16 months ago, Apple (AAPL) sold 1.7 million in the first weekend, counting pre-orders.
The analysts MORE
Philip Elmer-DeWitt - Oct 15, 2011 5:55 AM ET
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* The initial crop of iPhone 4S reviews are out, and while the smartphone's chassis might look virtually identical to its predecessor, the upgraded components -- a dual-core processor, 8-megapixel camera, among them -- and brand spanking new software (hello, Siri) are enough to make the phone another successful Apple (AAPL) MORE
JP Mangalindan, Writer-Reporter - Oct 12, 2011 3:30 AM ET
Surpassed the 600,000 record set in 2010 with the iPhone 4
Photo: Apple Inc.
Apple (AAPL) on Monday issued the following press release:
CUPERTINO, California—October 10, 2011—Apple® today announced pre-orders of its iPhone® 4S have topped one million in a single day, surpassing the previous single day pre-order record of 600,000 held by iPhone 4. iPhone 4S is the most amazing iPhone yet, packed with incredible new features including Apple's dual-core A5 MORE
Philip Elmer-DeWitt - Oct 10, 2011 9:47 AM ET
Apple has managed to eliminate the price premium while maintaining its profit margins
Click to enlarge. Source: Deutsche Bank
"We expect customers who do the math to opt for the iPhone," writes Deutsche Bank's Chris Whitmore in a note to clients Monday.
Moreover, he adds, so will customers who don't do the math.
Whitmore's analysis involves comparing the price, features and total cost of ownership of the refreshed iPhone 4S with its leading MORE
Philip Elmer-DeWitt - Oct 10, 2011 7:34 AM ET
AT&T alone sold 200,000 in 12 hours. By Friday night, ship dates slipped to 1-2 weeks
If you had any doubts that Apple (AAPL) would be able to beat the record 1.7 million iPhones sold in three days in June 2010, you can put them to rest.
Despite early glitches that slowed down pre-orders, AT&T (T) announced Friday it had taken orders for 200,000 iPhone 4S units in the first 12 hours MORE
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