Will Apples Legal Cases Lead to a Consumer Backlash?

While Apple claims that the leaks of new product details damage its sales and give competitors the chance to more quickly catch up with it, it's hard to avoid the conclusion that the leaks also build up a level of excitement-and earnings-that co

If Apple Computer Inc. pays its lawyers a retainer, then its certainly getting good value for its money over the past six months.

Despite being the poster model for freewheeling, vaguely counter-cultural values in the computer industry, the company has kept its legal team busy by suing a motley assortment of college students, journalists and Mac fans who have managed to draw its ire.

Since last December, Apple has found itself at the heart of several high-profile legal cases that center on one thing: its struggle to keep its future product plans secret.

The company argues that secrecy over its products is essential to its ability to keep innovating. Its critics claim it has launched actions which not only step over the mark of protection and into the realm of persecution, but which raise issues that go to heart of freedom of speech and the abilities of reporters to do their jobs.

In its latest move, the company last week agreed to settle a case it had brought against Vivek Sambhara, a Canadian college student who, the company claimed, had been responsible for redistributing an early developer build of Mac OS X 10.4, AKA Tiger.

Neither Sambhara nor one of his co-defendants was accused of being the original source for the leak. However, by taking part in the distribution of the files using BitTorrent, Apple claimed both had violated their agreements as Apple Developer Connection (ADC) members. As free, online-only ADC members, neither had official access to developer releases of Tiger, but because both had signed up to the scheme, Apple claimed it was within its rights to sue them. Sambhara was served with court documents on Christmas Eve 2004.

/zimages/2/28571.gifClick here to read more about the defense of journalists in these cases by the Electronic Frontier Foundation.

Sambharas case drew some high-profile defenders, most notably Apple co-founder Steve Wozniak, who promised to donate $10,000 to his legal defense fund. Wozniak later stated that "I wish that Apple could find some way to drop the matter. In my opinion, more than appropriate punishment has already been dealt out."

Other developers, while siding with Apple over the need to protect its intellectual property, called upon the company to settle the matter without ruining Sambhara and the others— a call that the company appears to have heeded.

The second and perhaps more controversial front is Apples continued suits against several Mac web sites, which have either sought to force the sites involved to reveal their sources for stories on upcoming products, or, in one case, accused journalists of publishing information covered by laws over redistribution of trade secrets.

In one case, a California judge recently ruled that AppleInsider and OGradys PowerPage must reveal their sources for stories about Asteroid, a putative audio breakout box designed to compliment the companys GarageBand software. This case has drawn a lot of attention, much of it misplaced.

Although many reports have characterized the sites as "bloggers", all are in fact long-established news sources in the Mac community, pre-dating the blogging phenomena by many years. Meanwhile, Apple is also suing Think Secret over its publication of stories on iSync, iWork and the Mac mini, arguing its trade secrets were violated by the stories.

However, as the cases have continued some large names have gradually got behind the side of the journalists, from the Electronic Frontier Foundation to the San Jose Mercury News, San Francisco Chronicle and Los Angeles Times, all of which have filed amicus briefs supporting the web sites.

Among the people that Apple is most likely to care about— the core Mac aficionados who congregate every year at events like Januarys Macworld Expo in San Francisco— the support for Apple has been considerable. At virtually every news site covering the cases the comments have been flooded with Mac fans decrying the leaking of information and supporting Apples attempt to keep its secrets until the date of its choosing— often in vehement terms.

Ironically, it is these very fans who tend to form the audience for sites such as Think Secret, who cluster around message boards and mailing lists to discuss the latest in rumored new products, and to pass on rumors of their own. And, while Apple claims that the leaks of new product details damage its sales and give competitors the chance to more quickly catch up with it, its hard to avoid the conclusion that the leaks also build up a level of excitement about the company that competitors would love to have.

So far though, outside the media and away from the hardcore Mac fans, the law suits appear to have had little effect on either Apples sales or its public image, both of which have soared on the back of the success of the iPod.

The company recently announced a big jump in profits on the back of surging sales of iPods and low-end Macs&151; something that also makes it difficult to claim that the companys sales have been damaged by leaked news of forthcoming products. If there is a consumer backlash, it doesnt appear to be doing Apple any real harm.

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