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Tech Check
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] conference call: A not-so-veiled threat by Apple COO Tim Cook against Palm [PALM
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] about now standing around watching its intellectual property "get ripped off." Even though Cook didn't name Palm, the widespread understanding was that Cook was talking specifically about Palm and its new Pre touch screen smart phone that helped the company's shares double in value since the phone's unveiling at the Consumer Electronics Show.
The saber rattling is not just bluster, either.
Apple was talking specifically about patents it had already received when Cook made those comments. But then, even worse news for Palm last week came in the form of yet a new patent with the title “Touch screen device, method, and graphical user interface for determining commands by applying heuristics.” Heuristic is a fancy word for "discovery."
Either way, I've had a chance to skim through the actual patent (you can read it here) and it sounds like there might be reason for some sweaty palms at Palm.
For its part, Palm has stayed true to its defense that the technology on which the Pre is based is its own. A spokeswoman told me the night of Cook's comments that "We have patents, too."
Today, the rhetoric gets beefed up a notch: “Palm has a long history of innovation that is reflected in our products and robust patent portfolio, and we have long been recognized for our fundamental patents in the mobile space. If faced with legal action, we are confident that we have the tools necessary to defend ourselves," says spokeswoman Lynn Fox.
None of this seems to be doing the trick, however, as far as Palm's stock is concerned.
I wrote in the days after the Palm spike that shares had outgunned the news, and seemed to be rising too quickly, especially since we are still awaiting a release date and price for the Pre. Is this thing ready for prime time or not? Nonetheless, following news this morning of Apple's newest patent, and of course the Tim Cook language, Palm shares promptly dropped 7 percent before recovering slightly toward the end of the day.
Fox also maintains that the Palm Pre "will come to fruition, and we have no plans to change the schedule." That should come as welcome news for nervous investors wondering whether they should still be giving each high fives, or whether they should be sitting on their hands instead.
Also, one other thing to consider: Some analysts tell me that Apple's bluster is just that, pointing to the concept of so-called "prior art." That's the idea that if a device or invention has been described to or used by the public prior to the patent being approved, a subsequent patent based on that technology may not be valid.
Palm won't comment on that aspect of this at all, choosing to stick by the statements it has made and the patents it has won on its own. It seems this might not be as cut and dry as some might think, but I suppose that's why we have courts.
Somehow I get the feeling we haven't heard the last of any of this. One thing is certain: this will continue to hang over Palm shares.
Questions? Comments?
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