Google backs HTC in what could be 'long and bloody battle' with Apple
Analyst Charlie Wolf, in a note to investors with Needham & Company Wednesday morning, said he believes Apple has a good chance to win its suit against HTC. A victory could result in patent violators being forced to change the user interface on their devices, or be forced to not sell their phones in the U.S.
"Apple invested heavily and imaginatively in designing a unique, disruptive smartphone," Wolf wrote. "In our view, the company has every right to protect the iPhone's unique features."
It was on Tuesday that Apple filed complaints with the U.S. International Trade Commission and in a U.S. District Court in Delaware, accusing rival phone maker HTC of infringing on 20 patents related to the iPhone's user interface. Apple also specifically named a number of handsets, including some powered by the Google Android operating system, as being in violation.
Following the news, Google reached out to TechCrunch to weigh in on the matter: "We are not a party to this lawsuit," a spokesperson said. "However, we stand behind our Android operating system and the partners who have helped us to develop it."
Wolf said Apple's main issue with Android likely lies in the application of multi-touch functionality, originally pioneered by the iPhone. HTC and Google partnered to create the Nexus One handset, which received a software update adding multi-touch support after its January release. A year ago, HTC also introduced an Android phone with an iPhone-like virtual keyboard.
Apple's lawsuit specifically stated that the alleged patent violations pertain to "software architectures, frameworks, and implementations, including various aspects of software used to implement operating systems." Apple has asked the ITC to ban the sale of all HTC handsets in the U.S., and also to issue a permanent cease and desist order preventing the company from selling, distributing, licensing or advertising its smartphones.
Wolf said he believes Apple has fired the "first salvo in what could be a long and bloody battle" with rival HTC. The analyst sees Apple's aggressive approach with both HTC and Google as a positive for the company. Needham & Company has maintained its buy recommendation for AAPL stock with a price target of $280.
Also weighing in Wednesday, analyst Shaw Wu with Kaufman Bros. said the lawsuit is likely to take years, but Apple's "very large war chest" will likely force some competitors to either take out features or pay royalties to Apple.
"While we are not surprised with this lawsuit as AAPL has said that it intends to vigorously defend its intellectual property, we do find the timing somewhat curious," Wu wrote. "From our conversations with industry sources, we believe the recent introduction of basic multi-touch capability by HTC and (Google) likely triggered this. While the lawsuit doesn't name GOOG, we believe it is indirectly aimed at the company as well as at others including (Nokia), (Motorola), Samsung, LG, etc.