Tuesday, August 28, 2012

Apple seeks quick bans on eight Samsung phones - Reuters

Tue Aug 28, 2012 9:25am IST

* Apple shares up 3 pct in premarket trading

* Google shares down 2 pct before the bell

* Android handset makers may have to redesign products - analysts

(Adds bullets, analysts' comments, background, updates share movement)

Aug 27 (Reuters) - Shares of Apple Inc (AAPL.O) looked set to open up 3 percent to a new life-high on Monday, after the iPhone maker won a bitter patent war against Samsung Electronics Co Ltd (005930.KS) that may change the dynamics of the booming mobile computing market.

Analysts said the win strengthened Apple's position ahead of the iPhone 5 launch and could cement its dominance in the market as companies using Google Inc's (GOOG.O) Android operating system -- two-thirds of the global market -- may be forced to consider design changes.

Apple was awarded $1.05 billion in damages on Friday after a U.S. jury found the Korean company had copied critical features of the iPhone and iPad. The verdict could lead to an outright ban on sales of key Samsung products. [ID:nL2E8JOHDZ]

"While a ban would likely increase Apple's leading smartphone share in the U.S. market, we believe this verdict could lead to Samsung also delaying near-term product launches as it attempts to design around Apple's patents," Canaccord Genuity analysts said in a note.

Google shares were set to open more than 2 percent lower, while Samsung's stock slumped 7.5 percent on Monday, wiping off more than $12 billion from the South Korean company's market valuation. [ID:nL3E8JQ0CS]

Shares of Apple rose to $681.19 in trading before the bell on Monday. They closed at $663.22 on the Nasdaq on Friday.

The verdict comes as competition in the mobile device industry intensifies, with Google jumping into hardware for the first time with its Nexus 7 tablet, and Microsoft Corp's (MSFT.O) new touchscreen friendly Windows 8 coming in October, led by its "Surface" tablet.

The jolt to Android could also mean good news in the near term for Research in Motion Ltd's (RIM.TO) upcoming BlackBerry 10 mobile operating system and for Nokia's (NOK1V.HE) phones.

Shares of the BlackBerry maker, which closed at $6.94 on Friday, were up 7 percent in premarket trading on Monday, while Microsoft's stock was up 1.2 percent.

"The verdict does not come as a surprise," William Blair & Co analysts said, but added the win would ease concern at Apple that had been worrying about Samsung's market share and its leadership position in the smartphone market.

"Companies such as Samsung, who we categorize as fastfollowers, have been viewed by the industry for their ability to quickly adopt the latest handset trends ... rather than their ability to introduce fundamental innovation."

Samsung, which sold around 50 million phones between April and June -- almost twice the number of iPhones -- will have to pay less than half the compensation Apple sought. The damages are just 1.5 percent of annual revenue from Samsung's telecoms business.

While the victory does not cover new Samsung products, like the Galaxy SIII, Apple will push its case on these products in the near-term, Evercore Partners analyst Mark McKechnie said.

He added that abn all-out sales ban on Samsung products like the Galaxy S and SII, Nexus 4G and Galaxy Tab is unlikely.

(Reporting by Sayantani Ghosh and Sruthi Ramakrishnan in Bangalore; Editing by Joyjeet Das)

((sayantani.ghosh@thomsonreuters.com, within U.S. +1 646 223 8780, outside U.S. +91 80 4135 5800, Reuters Messaging: sayantani.ghosh.reuters.com@reuters.net)) Keywords: APPLE SHARES/

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