Apple's Simple Workaround for VirnetX Royalty Claims

Apple's (NASDAQ: AAPL  ) extremely simple workaround for VirnetX's (NYSEMKT: VHC  ) networking patents reveal how easily the company's claims can be ignored. Add in a recent court victory by Cisco Systems (NASDAQ: CSCO  ) over many of the same VirnetX claims, and the cracks in the patent trolling strategy start to show.

In this video, Fool contributor Anders Bylund explains why these developments are bad news for VirnetX.

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Read/Post Comments (16) | Recommend This Article (7)

Comments from our Foolish Readers

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  • Report this Comment On April 12, 2013, at 9:49 PM, asdasdasdasdasd1 wrote:

    How does this in anyway relate to apple "working around" infringing Facetime and iMessage?

    Did you also talk about the repercussions for users such as the corporate world and the government who will no longer have an AUTO VPN security?

    Also, to your "patent troll" comment, Its hard to sell your own products when apple gives them away for free (FaceTime).

    See my most recent article concerning VirnetX here.

    http://seekingalpha.com/article/1332291-virnetx-comes-out-wi...

  • Report this Comment On April 12, 2013, at 10:26 PM, CallMeSizzle wrote:

    You are either completely illiterate in technology or you are a shill for someone. Is this video meant to be taken seriously?

  • Report this Comment On April 12, 2013, at 10:40 PM, vhcstrong101 wrote:

    its states that you write articles for a living. The first thing you need to do is get the facts and then take some classes on speaking. Why dont you stop spreading lies and why didnt you state that you were short VHC and long apple? Why is it that apple has not came out and stated that they have a work around if it "just that simple"? You make me sick!

  • Report this Comment On April 13, 2013, at 9:22 AM, tjavatarici wrote:

    Simple workaround? For whom? They did nothing but disable needed user functionality. This is not a "workaround".

    You are seemingly unaware that VHC developed and OWNS this softwaret--just like the Apple patent suit against Samsung for their stuff, This may be a huge pain in the rear for those of us with iOS at our companies. Read this article at Security Week, then make a new video with the facts.

    "Patent Lawsuit Against Apple Forces Enterprises to Scramble Over iOS VPN Functionality"

    http://www.securityweek.com/patent-lawsuit-against-apple-for...

    Cash-fat Apple needs to pay user fees for this service or buy VHC, but get past this or lose business--especially with future 4G advanced on the horizon. Simple? No way.

  • Report this Comment On April 13, 2013, at 12:01 PM, andbegin wrote:

    Anders, telling lies about technology to create fear, uncertainty, and doubt when you are short the stock you are writing about is the same as stealing. Long investors invest their hard earned money only to have it stolen by crooked shills like you. What you do should be a felony and I would love to see you behind bars.

  • Report this Comment On April 13, 2013, at 12:07 PM, TMFZahrim wrote:

    I don't own Apple, don't short VirnetX, and never held either position. I'm just trying to help investors avoid a massive trap.

    As for Apple's workaround, here you go:

    https://support.apple.com/kb/TS4550?viewlocale=en_US&loc...

    Anders

  • Report this Comment On April 13, 2013, at 2:25 PM, alphaprime47 wrote:

    The link you provided is NOT a work-around! A work-around would provide the same level of security with the same level of functionality. What Apple is proposing is a LOSS of functionality and security for its enterprise users --- those who need external access to secure internal site, such as corporate email.

    Do you really think that Apple will go down this path and extremely irk tens upon tens of thousands of users? Just so it can avoid paying (for it) a miniscule amount of money to VHC. This 'announcement' is simply a ploy, a ruse, to try and convince Judge Davis (who oversaw the Apple - vhc trial) that he should lower is forward looking royalty rates for VHC. This is typical Apple behavior, 'cleverly' thought up by its lawyers and engineers. If this work-around was such a good thing, why didn't Apple incorporate much earlier? Why didn't Apple demonstrate it at trial?

    I'm rather surprised (perhaps I shouldn't be, come to think of it) that you fell for the ruse as well. I don't think the clear-sighted judge will, though.

  • Report this Comment On April 13, 2013, at 5:51 PM, andbegin wrote:

    Hey Anders, I would like to hear your "expert" opinion on the following article. This particular author seems to understand the technology better than what was presented in your piece and in addition, his understanding and explanation of this technology is in complete opposition to what you wrote. Please take the time to read it and tell us where he is wrong.

    If you don't respond, your audience will most likely come to the conclusion that your article was indeed a hit piece. Please prove him wrong so you can preserve your reputation.

    http://www.securityweek.com/patent-lawsuit-against-apple-for...

  • Report this Comment On April 13, 2013, at 10:52 PM, BlyndDaDoush wrote:

    For someone that is simply "trying to help investors avoid a trap" you have written a significant amount of articles with immense negativity regarding VHC.

    If you were simply staying your opinion, then I think one one article would suffice. But at least once a week you write yet another article, with the same BS, incorrect statements, simply giving a different title to the article.

    Just last week you wrote an article regarding CSCO/VHC and you are in fact long shares of CSCO.

    I am anxious for the day the SEC will find out whose payroll your on and put you down for good like a rabid dog.

    People in a public position such as yours have a responsibility to make statements based on facts.

    You should give it a try some time.

    "The truth shall set you free"

  • Report this Comment On April 14, 2013, at 2:59 PM, andbegin wrote:

    {{Crickets}}...Just as I expected. Anders is not only a liar, but a coward.

    Shame on you, you crook.

  • Report this Comment On April 17, 2013, at 9:27 AM, franksmartin wrote:

    Anders,

    As someone who has subscribed to several fool newsletters in the recent past, I can say this is one of the most uninformed articles I have ever seen. You clearly don't understand the story here.

  • Report this Comment On April 17, 2013, at 8:06 PM, InetPO wrote:

    In full disclosure I own VHC stock and plan to own more. With that said, I am also an expert networking.

    I think the Anders analysis is wrong for the following reasons. VPNs, unlike stateless connections and pooled resources, require computing overhead and dedicated resources to setup and establish a secure private network connect which protects IP packets as they move over the VPN. Making these connections dynamic will add a great deal of extra overhead and latency to network infrastructure equipment and the VPN host. Attempting to pool these resources would require significant changes to network infrastructure configurations to businesses other than Apple, and could also cause serious security risk for un-managed connections. Apple has demonstrated in the past they don't really care about this impact because they do everything proprietary. However, companies like Cisco, AT&T and other rely on standard VPN solutions will likely resist.

    Imagine a large part of your workforce not able to connect to your company’s private network until the company upgrades its network infrastructure and configuration to support Apples proprietary VPN solution. Don't believe me, did you ever try to integrate EhterTalk from Apple, watch flash content, view Google Maps, and charge your iPhone with a standard mini or micro USB charger. How about connect Apple to corporate email. However, Apple will comply with standards when they can't get their own way which is why they use TCP/IP, POP, and other standards today.

    Secondly, I disagree with the term Patent Troll in this instance. Having authored many patents and licensed or sold a number of them, patent trolls are companies who aggregate many patents in many industries for the sole purpose of enforcing them. Interestingly, Apple, IBM, Micrsoft, Cisco, Google and many others all have investments in patent licensing companies who sole purpose is to seek out companies that could revolutionize technology or services at their peril and effectively stifle innovation that they can’t control. VirnetX is simply protecting its IP the way you might protect your front year when Apple, Microsoft and others were infringing by setting up shop on your front lawn. Like all disputes that cannot be easily resolve, VirnetX asked for legal mitigation and won. Does Anders disagree with that? I bet his position would be different if he invented VPN. I might also note that Apple was more like the neighbor who released its Pit-bull on the neighbor when it went after Samsung...would you call them a patent troll. If not, you should listen to TED discussion regarding Steve Jobs and robbing, remixing and reusing.

    For me, I think where there is smoke there is fire. The courts said to Apple, you lost. Now it seems they are attempting to bully others and cause others discomfort, inconvenience and cost to get their own way. People hate bullies and I would not be surprised to see loyal Apple users jump ship to Android or Microsoft. I know if I had an iPhone I would, but I threw my Apple garbage out a long time ago.

  • Report this Comment On April 17, 2013, at 8:08 PM, InetPO wrote:

    Correction: "..an expert in networking...". Apple's new VPN solution must have dropped a few packets there :). Get used to it if Apple tries a workaround.

  • Report this Comment On April 18, 2013, at 8:41 AM, franksmartin wrote:

    This should clarify things for Anders. It's all about facetime and iMessage and the "workaround" does nothing to address this.

    http://www.investorvillage.com/smbd.asp?mb=8852&mn=44095...

  • Report this Comment On April 27, 2013, at 9:34 AM, sfv44 wrote:

    And...... Just two short weeks later, Apple has reversed course on their plans for a "simple workaround". Guess it wasn't as simple as you thought eh Anders? Sure points to an agreement being struck.

    http://support.apple.com/kb/TS4550

  • Report this Comment On April 28, 2013, at 1:10 PM, andbegin wrote:

    "And...... Just two short weeks later, Apple has reversed course on their plans for a "simple workaround". Guess it wasn't as simple as you thought eh Anders? Sure points to an agreement being struck."

    Like I said. This fraud, known as Anders Bylund, consistently writes hit pieces against Virnetx that completely distort the truth. This has been going on for quite sometime. He claims he is not short the stock, which may be true, however I am sure he is a paid shill for someone that is heavilly short Virnetx.

    If this "con" man continues to write hit pieces I will make sure to be the first to comment on each piece with a link to this page, so the less educated regarded Virnetx technology will understand that Anders Bylund intent is to beguile them.

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