1 Big Change for These 2 Tech Giants
Aug 14th 2012 10:12PM
Updated Aug 14th 2012 10:16PM
On Monday, Reuters tattled on Microsoft (NAS: MSFT) : Bill Gates is now officially and legally an Apple (NAS: AAPL) copycat. Licensing what Samsung has reportedly stolen, Microsoft now holds the rights to a suite of Apple's best design patents. Here's what you need to know.
Apples and oranges
Microsoft might've bought some of Apple's design patents, but it's going to have to leave the cloning to Star Wars. Apple's agreement includes an "anti-cloning agreement" that gives its sleek curves and edge-to-edge glass to Microsoft without handing over its body.
This move might be more protective than forward-thinking. Microsoft's new Surface tablet shares some uncannily similar characteristics to the iPad, potentially paving the way for future lawsuits.
As we've seen with the recent Apple-Samsung lawsuit, Apple's not afraid to point fingers to protect its work. If you've read beyond the headlines, you know that this lawsuit has been two years in the making, ever since Steve Jobs and Tim Cook personally delivered a presentation to Samsung outlining dozens of patent infringements.
It could've ended as a $250 million business transaction, but Samsung refused Apple's ask. Tim Cook is now demanding upwards of $2.5 billion and Samsung's name has made history in the tech tabloids.
Don't create, imitate
Microsoft's new deal might seem like another lackluster attempt to tag along behind Apple's first-mover success. Investors and consumers alike cringed when Research In Motion (NAS: RIMM) unveiled its tablet BlackBerry Playbook without basic features like email and a calendar. Corporations can even suffer from intra-company copycat failures, namely Coca-Cola's botched "New Coke" of 1985.
However, Microsoft's new purchase strategy might just be its smartest move in decades. Its software/hardware identity crisis has plagued productivity as mobile devices have gained precedence, hurting the company's bottom line and creating a divisive corporate culture.
Despite its bad rap, Microsoft does actually do some things well, and this recent move will free up time and money for Microsoft to play to its strengths. Its two main revenue sources are its Office Suite and Windows OS, respectively comprising 35% and 25% of total sales. With design-focused products like the Xbox and Windows Phone responsible for only 3% of revenue, Microsoft should leave the aesthetics to the experts.
Microsoft stands to gain from this newfound partnership, but Apple's certainly not losing out. Another checkmark on its "outdo Microsoft" to-do list, Apple's got a whole lotta patents and ideas that it's not letting competitors anywhere near. Motley Fool analyst Eric Bleeker has prepared a special report outlining exactly why Apple still has plenty of room to run. It comes with a year of free updates and is chock-full of useful information. Pick up your copy today.
The article 1 Big Change for These 2 Tech Giants originally appeared on Fool.com.Fool contributor Justin Loiseau owns shares of Apple and two really old iPods. You can follow him on Twitter, @TMFJLo, and on Motley Fool CAPS, @TMFJLo. The Motley Fool owns shares of Apple and Microsoft. Motley Fool newsletter services have recommended buying shares of Apple and creating a bull call spread position in Apple and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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