How Samsung is winning the anti-Apple iPhone wars

With two million pre-orders for the iPhone alreadyApple [AAPL] seems on target to deliver the biggest-selling consumer electronics device since the last product from the company, though this achievement is clouded by the legal battles surrounding the smartphone race: and it’s Samsung, not Apple, which is gaining the most from the litigation.

[ABOVE: Only last year Samsung's Galaxy ads lampooned Apple's iPhone fans.]

The intelligence game

While it’s true Samsung continues to manufacture components for Apple devices, its smartphone division continues to wage unholy war against Cupertino. Ingeniously, while engaged in this vicious campaign it appears to be succesful in painting itself as the underdog in the conflict, but in truth the symbiotic relationship between the two firms means the Korean firm is using the conflagration to build its reputation in the smartphone space.

That’s why it’s not at all surprising that the first thing Samsung did following introduction of the iPhone 5 has been to publish a series of directly competitive newspaper ads across the US

Under the banner, “It doesn’t take a genius” the ads claim to compare the iPhone 5 with Samsung’s Galaxy S III smartphone, with a lengthy comparison feature list which the company ends with the phrase, “The next big thing is already here”. The Galaxy III last month became the biggest-selling US smartphone, though this position will be lost this month on strength of iPhone 5 sales.

That’s following weeks of rumor during which Samsung claimed that in the event Apple introduced LTE/4G support within the iPhone 5 it was committed to laying yet another lawsuit against Cupertino, alleging abuse of industry-standard FRAND patents. These are patents which are meant to be made available to all parties interested in using a technology within a product on a non-partisan basis.

The latest ad isn’t the first time Samsung’s applied its marketing muscle against Cupertino. The firm’s been pretty consistent in its approach. It wasn’t too long ago it ran a series of television spots in which it satirized its own conceit of what Apple fans might be like. Even its most recent Galaxy II ads see the actor cast last year as an Apple iPhone fan now using a Samsung thingy.

The legal gamble

Apple recently won a key victory against Samsung in the US court when a nine-person jury declared the Korean firm had infringed the iPhone-maker’s design and utility patents across some of its products. 

The jury awarded Apple with a billion dollars in damages

While Samsung will appeal against the final judgement, Apple felt the victory justified its claims that its former close partner had copied its ideas within the iPhone.

Apple didn’t want to turn to the courts.

Apple CEO, Tim Cook explained: “We chose legal action very reluctantly and only after repeatedly asking Samsung to stop copying our work. For us this lawsuit has always been about something much more important than patents or money. It’s about values.”

While any rational person’s hyperbole alert may tickle a bit on claims a global corporation has values it wishes to cling to, a rational observer may also want to reflect on claims made during the court case that Apple met with Samsung several times in an attempt to find a reasonable settlement. These attempts failed.

The two parties have failed to find themselves a happy finish to the battle so far.

Why?

The true marketing machine

Samsung has attempted to pour derision on Apple users as “iSheep”, but who is following who across this cliff? After all, the US courts currently agree Samsung contravened Apple’s patents, proving itself to be some form of copyist. It also seems to me that Samsung is prepared to abuse the spirit of FRAND patent agreements. 

In truth, the latest “It doesn’t take a Genius” ad campaign could easily be seen as the latest in a series of highly aggressive moves by Samsung. At the same time, the multinational firm continues to find success in portraying itself not as a multinational corporation with a wide range of business interests, including arms manufacture, but as a tiny David up against Apple's great big Goliath.

A rational person may wonder at this accomplishment of Samsung’s marketing department.

What does it gain?

  • What it gains by the campaign is credibility. Even as it uses every tool in its box to make things difficult for Cupertino, it pretends to be a victim.
  • What it gains by the campaign is to create around itself a congregation of those who resent Apple. While lampooning Apple fans.
  • What it gains by refusing to agree to Apple’s peace deal attempts is visibility for its brand. Even while it chooses to exploit Apple’s hard-won brand in its own marketing.

A rational person may look to Samsung’s accomplishments in the battle so far and be impressed by its other clever achievement: to build its business on a global scale in one business sector while managing to sell huge quantities of essential components to its biggest competitor in that space.

A truth -- for those prepared to accept it -- is that Samsung is gaining much, much more from its war with Apple than the iPhone maker wins. That's why I think Samsung has seemingly avoided reaching an end to the conflct.

We’ll wait to see if this war proves to be the rock upon which the dream ship of Apple’s success sunders and sinks. But portrayal of the Korean firm as an innocent abroad is to accept a far bigger reality distortion field than Apple’s late co-founder, Steve Jobs, ever cast.

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Copyright © 2012 IDG Communications, Inc.

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