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Hell..Apple could of bought Creative for $100 million and still have change leftover.

Check off another lawsuit off the list.

Excellent indeed.. now if we can just get all this stock-option ugliness behind us.

Wow! I know Apple has 9 billion in the bank or whatever but I didn't think they would cough up this kind of cash. Creative must have actually had a real case here for Apple to back down.

On the other hand, it's sounds like Creative finally wised up and realized, that patent or no, they weren't going to even make a pinprick in Apple iPod business. So take the money and get in bed with Apple and start cranking out iPod accessories.

I think that the iPod accessories announcement is a sretty strong sign that the Creative is going to drop their own players. Competing in this market is costing them too much in marketing expenses (and inventory writeoffs when the units dont sell)

Steve pulls out the $100M dollar bill from his jeans left little pocket...(the other has his nano in it)...and says, "Let's move on"...by the way, Steve's face is on the $100M bill.

I guess they were afraid of litigation going on forever.

I think Apple is being generous here. It gives Creative the chance to make money because after the iPod and the Zune coming up there won't be much market for them.

creative is the scummiest of all scummy bottom-dwelling companies. I wish it didn't end with $ in their pocket, they don't deserve it.

Everyone else will be filing their Lawsuits in short order to get a piece of the iPod fortune.

Apple made a big mistake settling for that much money.

I agree with MDN take. With all the pressure Apple is under with NASDAQ delisting threat (pay attention to this, it's not nothing), disappointing Intel first edition machinery, and a very, very weak new cat (so far), Apple needs to get some breathing room and work on quality, performance improvements and customer care.

More blood on the click wheel? Blood, not from a fatal blow but a crippling injury...

BOYCOTT CREATIVE

Don't buy their stuff, they will spend millions of dollars to make absolute junk that will ruin any iPod stuck in them. Creative don't play nice.

There is a company called 3DLabs which Creative owns, they make awesome and affordable 3D rendering video cards, but won't make any for Mac's.

For many years Mac users have begged the company to make cards for Mac's because rendering on the Mac's suffered compared to their PC versions.

3DLabs wrote nasty emails back to Mac users telling them to get a Windows PC and that the Mac "was dead" and that the parent company (Creative) hates Apple, see's them as a competitior and will not associate with Apple or it's products.

CREATIVE IS NO FRIEND OF MAC USERS.

BOYCOTT CREATIVE

This was a savvy move on the part of his-Jobness. There's no "moral highground" to be awarded here so, pay Creative royalties, let them make iPod accessories and watch their branded players vanish from the marketplace. This is win win as far as I can tell. Hopefully we'll see some cool accessories come out of Creative's camp and Apple can focus on the next generation of kick ass stuff.

Well I guess Creative has to make money somehow. Obviously, it's not through the sales channel.

Nobody hands out 100 million unless they think that the other guy has a solid claim and that they're going to loose.

Wow, I'm shocked that Apple paid so much! In fact, I'm shocked Apple paid at all! I thought that Apple had a strong case that heirarchical menus applied to music players was not a patentable process.

I guess that works out to $2 an iPod. Pretty sweet deal for Creative, seems to me.

SWH of Creative is one lucky SOB!

Sorry to disagree with your take Pete, but I haven't encountered any sort of groundswell of support for your contentions of "disappointing Intel first edition machinery", or "a very, very weak new cat".

Seems like it was very recently that I read an article suggesting that Apple can't meet demand on the Macbook, in fact.

I've also read some fairly positive articles about what Apple (appears) to be readying with Leopard.

Also works out at about 12 cents per Apple share.

Hmmmm. Both side of the thought have merit. But . .
The lawsuit is done.
All apples for all time have NO issue.
Creative just jumped into the Apple camp. Maybe a sign of things to come as MS plays so dirty.
100 million is not so much when its used to decrease your TAX burden.

Looks like the next year will be an interesting place.

N.

Steve was quoted as saying Creative was very lucky to have that patent... It's about the only thing that'll save their arses. I love the tie-in to licensing - if Creative issues licenses on their patent, then the settlement is reduced. Rather interesting. Almost suggestive that the patent really is hooey. I wonder how many licenses they'll get at Creative?... Anyone who licenses is essentially a competator of Creative more directly than Apple. What a chess game!

Seems like Creative is eating lots of sand, lately...

From Beleaguered Creative reports revenue slide - August 11, 2006:

MacDailyNews Take: For those counting, the word "loss" was used in beleaguered Creative's earning press release was used one dozen times. Craig McHugh, beleaguered Creative's president also states in the press release, "we are targeting our return to profitability by the end of this calendar year and continued profitability going forward." McHugh should go into comedy full-time. Return to profitability? Yeah, if you forget about MP3 players and start making iPod accessories, maybe.

Seems like the $100M is funding Creative's R&D;into iPod accessories of which Apple gets a cut...

Checkmate!

Holy crap that's a lot of money.

This was on Apple Press Release at the bottom.

"About Creative
Creative (NASDAQ: CREAF) is a worldwide leader in digital entertainment products for PC users. Famous for its Sound Blaster sound cards and for launching the multimedia revolution, Creative is now driving digital entertainment on the PC platform with products like its highly acclaimed ZENª MP3 players. Creative's innovative hardware, proprietary technology, applications and services leverage the Internet, enabling consumers to experience high-quality digital entertainment -- anytime, anywhere."

"highly acclaimed". Since when did apple praise a competitors product. I'm with "creativebasher". I have always boycotted their products.

"Steve's face is on the $100M bill."

Actually, it's not his face which makes it MUCH more funny. There's also a cryptic motto under the picture, "YCKSJA." The watermark features Mike Markkula.

and the stupid IP patent system continues to reap the rewards for the litigators. lovely. not!

Gil,

That's just Creative's standard boilerplate for press releases. Apple's didn't praise Creative. That's just Creative praising themselves.

Hmmmmm,

I just had this very WEIRD thought.

Apple paid the Beatles 100 Million and later, the Beatles can't touch Apple and iTunes due to the wording of the settlement.

Apple sold Microsoft 150 million in stock and gave up the desk top looks war. Recently Apple runs Windows on a Mac and Microsoft says nothing. Wording of the settlement again. ?????

I don't know, but there sure is a weird connection.

N.

CreativeLicense said:

"if Creative issues licenses on their patent, then the settlement is reduced. Rather interesting. Almost suggestive that the patent really is hooey. I wonder how many licenses they'll get at Creative?... Anyone who licenses is essentially a competator of Creative more directly than Apple."

I have to wonder if Steve is goading them to pursue more lawsuits. If they can sue others into paying them licensing fees, they will spend part of $100M in legal fees, thus reducing their profits from the agreement. If they win, Apple gets even more of that settlement money back, further decreasing their profit from Apple. Not to mention this will distract Creative from actuall doing anything competitive (not that they really could) against the iPod. Their induction into the Made for iPod program makes perfect sense as it is the only way they will make MP3 money. If you make money on something, you also have a vested interest in making sure it stays around.

All in all, this seems like a very smart move on the part of Apple and that Steve is thinking several steps ahead, not just about the money right now. Go Steve!

OUch!!! 100,000,000 ouches.

Apple loses big.

Time to focus on The Beatles' lawsuit.

Everybody wants a piece of Apple.

That Apple even gave a dime to these crooks makes me want to vomit.

"Time to focus on The Beatles' lawsuit."

The one that was tossed out of court?

Microsoft's ZUNE interface appears to be very similar to iPod and Creative's patent.

Steve Jobs could be getting his US$100 million back sooner than some think!

So…I guess that now, MS and the Zune will have to pay a licensing fee to Creative for their menu system too, huh? It should be apparent that there is only one way to navigate anything reasonably, and that is as a hierarchical structure. Any fool can see that, except those in the patent office. Its getting really tiresome seeing everyone trying to patent the obvious. I feel like were drowning in legalism. Help!

For its third fiscal quarter ended July 1, 2006, Apple generated $1.954 billion in iPod and iTunes Music Store sales, iPod services, and Apple-branded and third-party iPod accessories.

That's $1.954 billion in just a 90-day period.

$100 million is a drop in the bucket for Apple.

MDN MW: "price" - how do they do that?!

The only better news would be that apple won the lawsuit. But between saved litigation costs and the avoided potential damages this is a 100% win for AAPL Investors such as myself.

MDN: My stock in apple will be "greater" than I bought it for for a long time.

The settlement has rather interesting timing since the Zune is going to be selling soon and, as StooMonster mentioned, it does have a very similar hierarchical interface... Maybe they have some plan of stopping the Zune from even coming to market or forcing MS to license the interface to Creative (and hence partially to Apple). That would be an ingenious plan for both Apple and Creative, but more so to Apple.

this means....iPod updates coming very fast and soon....with this behind Apple, my guess is that what ever plans they had for future iPod's can now set sail....next up "ZUNE" (Dead Man Walking)

"That's $1.954 billion in just a 90-day period.

$100 million is a drop in the bucket for Apple."

You're confused about the difference between revenue and profit.

The 100 million comes straight off the bottom line.

So Creative got about 1/4 of Apple's total profit for last quarter.

"100% win for AAPL Investors such as myself. "

No, it's a loss of $0.12/share. But you may be right. had the case gone to it's conclusion, you could have lost more.

Some of you people are idiots. Do you not realize that Apple has almost $9 BILLION in cash on hand?!? For Apple to give Creative a mere $100 million dollars is like you or I tossing a Quarter into a fountain at the mall!! It's absolutely nothing, plus Creative now has to pay Apple licensing fees for making iPod accessories. This was an absolutely brilliant move on Jobs' part.

Watch for all Creative Zen mp3 players to be suddenly discontinued between now and the upcoming holiday season as well...

I'm not sure that this point has been made clearly enough, but...

By licensing the patent Apple helps to validate it.

With a stonger defense of the patent in place and a war chest for legal costs, Creative can seek to enforce the patent against anyone else in the industry that infringes (which should be just about everyone).

The chances that anyone else can beat the patent in court are slim to none based on past hisotry.

Apple wins twice every time Creative goes after a competitor. First life gets harder for the competition (and more expensive whether they fight or license). Second, Apple shares in a slice of the pie if they license.

In effect, Apple has "bought" this patent (or at least a share in it) and it now becomes one of Apple's weapons as well.

As pointed out by previous commenters StooMonster and RePlay, do not be surprised if one of the first targets is Microsoft -- just add another $100 million to the launch costs (losses) of the doomed Zune. I am sure that Sony and SanDisk are not far down on the list either.

This is an unqualified brilliant move by Apple that further locks up the mp3 player market for themselves and builds yet another barrier to entry for the competition.

canis.major....

you got it! Apple bought this patent for $100 million.

They will slap Zune.

Funny thing is M$ Zune entry is probably what caused Creative to settle.

Now we know why Steve looked "sick" at WWDC keynote. They were probably working out this settlement then. It's not the money, I'm sure, it's just the priciple of handing it over to that loud-mouth Sim Hoo.

SirROM, you beat me to it. This settlement seems to be a way for Apple to indirectly sic Creative on the iPod's other would be "iPod Killers." Clever, isn't it? Apple keeps out of harm's way -- from the anti-trust shysters -- by allowing its paid for bitch to attack Apple's wanabee competitors. Brilliant, Steve, just brilliant.

This is actually a great win for Apple. They pat out to Creative but have aalso locked-in Creative and locked out the competition.

Creative can sue anyone, like M$, now and win damages but it won't be intheir interest to offer the same deal that Apple gets as they would have to pay Apple back.

So Creative sues X; Wins damages; collects royalties; X has paid out to creative but can no longer use heirarchical menus in their player.

As Creative will be making a pile as an iPod accessory maker it's also not in their interest to license the menus to any other player. The iPod has 75% of the market so who's bed would they rather be in?

Win for Apple as competition can't use the same or similar iPod interface. iPod stays unique. Creative makes money, unfortunately but it's the price we pay to screw the competitors in the player market.

Apple admits guilt, pays a huge fine, and they are lauded for their brilliance in here.

LOL

smartguy wrote: "creative is the scummiest of all scummy bottom-dwelling companies. I wish it didn't end with $ in their pocket, they don't deserve it."
Wrong. Lawyers dwell lower. A bunch of lawsuits could easily consume such amount and lawyers would be the only winners.

Excuse the typos in my post above. Trying to type too quickly. And not re-reading before I post. Bad.

Uh, excuse me, but $100m is still a lot of money. When you consider how "tight" Apple is with advertising dollars, keep in mind that that coin could have purchased a lot commercials that actually advertised what Mac OS X is and looks like.

/bored with PC and Mac guy ads

New headline:

Creative gets $100 Million welfare check from Apple

Creative Tech will recieve a $100 million dollar corporate welfare check from Apple and a mandatory re-training program in Apple accessories sweatshop in central China.

After stamping "Made For iPod" logos on million of iPod accessories, Creative is to pay the $100 million back to Apple is small incremental payments in the form of fee's to use the "Made for iPod" logo on anything they sell.

If Creative earns any other income during this time, by licensing their patent to others like Microsoft, it's to be applied to the $100 million debt to Apple.

So basically if Creative decides to change corporate welfare providers, namely from Apple to Microsoft, then Creative needs to pay off Apple first before using Microsoft welfare payments for it's own use.

Creative has been thrilled to avoid bankruptcy from their failed buisness practices and leveraged the only chip they had to recieve the handout.