Apple's A-bomb against Palm: A 358 page iPhone patent

  • Chicago (IL) - The announcement of Palm's new smartphone (dubbed Pre) has clearly sent shivers down Apple's spine; partly because several key engineers with a deep knowledge of Apple's secrets switched over to Palm, but mainly because Pre is the first iPhone rival to use multi-fingered gestures like pinch zoom. Armed with the 358 page iPhone patent awarded last week, Timothy Cook who runs Apple in Jobs' absence has now threatened Palm with legal action. Palm is not letting on that it's shaken, but make no mistake - too much is at stake here:  Both Palm's very survival and iPhone's fate. If the two companies meet in court, it could turn out to be the most interesting and entertaining lawsuit of 2009 (or the decade).

    "Boy, have we patented it!", said Steve Jobs during the world's first iPhone presentation in January 2007. Two years and several would-be iPhone killers later and the mobile industry still lacks a cellphone that would employ multi-fingered gestures like pinch zoom that made the iPhone famous. It's not that iPhone rivals lack technical expertise to engineer multi-touch-capable smartphone. On the contrary, it is sheer fear of lawsuits by one of the world's most powerful consumer electronics giant that is keeping multi-touch as an exclusive realm of the iPhone. With Pre, Palm is willing to challenge this and put its future at stake in the process as the company might find out that Jobs' words were not empty threats.

    Apple got the iPhone patent

    As revealed in Apple's mammoth 358 page patent application filed with the US Patent & Trademark Office last spring, Apple put its money where its CEO's mouth was. The patent application, entitled "Touch Screen Device, Method, and Graphical User Interface for Determining Commands by Applying Heuristics," describes all aspects of iPhone's touch screen, UI and methods in details. The patent, awarded to Apple this past week, credits no other but Steve Jobs as the registered holder, followed with 24 other named engineers like vice president of iPhone software Scott Forstall and Wayne Westerman. The latter is the key to multi-touch technology used in the iPhone.

    Apple was awarded last week a mammoth 358 page patent that covers all aspects of the iPhone's user interface, with especial emphasis on multi-touch and the way gestures are implemented.

    History of multi-touch

    Origins of multi-touch date back to 1982 when the first touch screen was engineered at the University of Toronto that could register more than one touch at a time. At the same time, Bell Labs (now part of Alcatel-Lucent) published what is believed to be the first paper dealing with user interfaces associated with touch screens and made its first multi-touch screen two years later. The technology went unnoticed until 1991 when Pierre Wellner published a paper about so-called digital desk that envision multi-fingered gestures, including pinching motions.

    It captured the imagination of University of Delaware academics Wayne Westerman and John Elias who started experimenting with possible uses through their Newark-based startup, Fingerworks. The company made keyboards and touchpads with opaque surface that could recognize gestures and Westerman even published a dissertation on the subject in 1999. Their work caught attention of Apple who was at the time researching early iPhone ideas so the company acquired Fingerworks in 2005. As part of the deal, Westerman moved in Apple's headquarters to continue developing multi-touch for Apple's handset.

    A closer look at "the mother of all iPhone patents"

    The 358 page patent is also called "the mother of all iPhone patents" with a good reason. It outlines iPhone's features and UI in excruciating detail, including the software and how gestures like finger swipe or pinch zoom are detected. The patent also provides a sneak peek at next-gen iPhones by listing several features not included with current-gen iPhones, like applications for blogging, instant messaging, digital video capturing, video conferencing, MMS, etc. Multi-touch aspects of the patent, without any doubt, are the most important to iPhone's future.

    Continued on next page: Palm Pre, Legal clash between Apple and Palm, Conclusion...

    Palm's Pre infringes the iPhone patent?

    When Palm announced Pre at the CES earlier this month, the tech press quickly dubbed the smartphone as the most serious iPhone rival to date. Analysts also think it is Palm's last chance of survival. Apple and RIM have washed away much of Palm's marketshare, while sliding profits forced the company to accept a $325 million of VC capital from Elevation Partners last year. Pre is scheduled for arrival in the first half of this year, roughly at the same time when Apple is expected to unveil an iPhone successor at its developer conference this coming July. As the two handsets go head to head in the marketplace, their vendors could go head to head in the courtroom.

    WebOS, the entirely new OS which powers Pre, sports striking similarities to iPhone's UI including gestures like pinch zoom. The way the phone implements its touch-sensitive panel could also clash with the iPhone patent. For example, Apple describes iPhone's touch panel in the patent as a "touch-sensitive area of the device that, unlike the touch screen, does not display visual output. The touchpad may be a touch-sensitive surface that is separate from the touch screen or an extension of the touch-sensitive surface formed by the touch screen." Palm's press release describes Pre's touch panel as "a gesture area, which enables simple, intuitive gestures for navigation."  Just like with iPhone, Palm's gesture area is separate from the touch screen.

    Palm's Pre announcement provoked Apple to threaten legal actions. Pre is the only handset besides iPhone that is advertise to bring multi-touch support with familiar pinch zoom and finger swipe gestures.

    Apple: "We will go after anybody who rips our IP"

    Apple's chief of operations Timothy Cook was quoted during recent earnings call with investors as saying, "We like competition, as long as they don't rip off our intellectual property. And if they do, were going to go after anybody that does." Although Cook refused to name Palm, he stressed that Apple is "ready to suit up and go against anyone," adding that the company "will not stand for having its IP ripped off." He warned would-be copycats that Apple will use "whatever weapons that we have at our disposal." The comment sent Palm's shares down 3.4% to $7.57 in afternoon trading on Nasdaq - enough to deliver the message.

    RIM: "Bring it on"

    The comment provoked Palm's reaction. The company's spokeswoman Lynn Fox told Reuters that "Apple was not the first to do multi-touch," arguing that the technology has been around for over 20 years. Indeed, Palm pioneered touch-based gadgets with the famous Pilot PDA and now has several touch-enabled products on the market like Treo and Centro. Fox stressed that Palm "has been building its own intellectual property portfolio for 15 years." Commenting on Apple's threat, she said that Palm "will defend [its IP] vigorously, if necessary." Fox also told WSJ's All Things Digital that it has the tools necessary to defend itself if faced with legal actions from Apple, citing Palm's robust patent portfolio (via Google Patent Search) and "fundamental patents in the mobile space."

    Final thoughts

    It's understandable that Apple is nervous: After all, its lead in the smartphone sector is at stake. If Apple's warning shot does not deter Palm, the company might have to take its rival to court. If Palm can challenge the iPhone patent and Apple loses the case, the floodgates will open. As a result, everyone and their Mom could copy this most unique aspect of the iPhone. Apple also got emotional because Palm recruited several of its executives with a deep knowledge of Apple's R&D process, like hardware engineer Jon Rubenstein.

    Steve Jobs recruited Rubenstein in 1990 as NeXT hardware engineer and later brought him to Apple where Rubenstein led the development of both the original iMac and iPod and became the first chief of Apple's iPod division in 2004. He elected to retire in 2005 and joined Palm late October 2007. Apple's ex finance chief Fred Anderson also jumped the boat to work as Palm's director, while Palm's software director Chris McKillop worked on the iPhone and iPod development teams.

    Since Rubenstein spent 15 years at Apple where his ranking allowed him access to many secrets, Apple obviously suspects he might have used them to build an iPhone killer. Ironically enough, it is for the same reason that IBM blocked its ex-executive Mark Papermaster from joining Apple, citing his deep knowledge of Blade serves and engineering secrets. Papermater is rumored to lead Apple's P.A. Semi engineering team and oversee the development of system-on-chips for future iPhones.

    All in all, Palm's survival and iPhone's fate are literally at stake here. With many companies around that hold patents to various embodiments of the multi-touch technology, the guy who blinks first may lose it all.

    Analysts warn that Pre is Palm's last chance for survival. But if Apple fails to hold to its multi-touch paten in court, a floodgate may open that could allow Apple's rivals to copy unique iPhone features.