According to documents filed by Creative with the United States International Trade Commission in mid-May, Steve Jobs approached a Creative employee at MacWorld 2001 to talk shop about Creative’s then flagship product, the Nomad Jukebox. What begun at this innocuous meeting may well have led to the creation of a digital audio empire that could have rivaled what Apple has put together on its own. On the other hand, it may have also led to stunning failure for both parties.
In the past few months, one of Apple’s biggest rivals in the digital audio player space, Creative, has begun competing with Apple using legal tactics. Looking back before the birth of the iPod, Creative had a significant lead on Apple, with almost a full year’s experience in developing and selling hard-disk-based players. What is almost completely unknown, however, is that Apple was willing to work with Creative to develop an Apple-licensed player as opposed to building their own from scratch.
According to Creative’s legal filings (available via PACER) with the US International Trade Commission, Apple had originally sought to license Creative’s IP and create the iPod on Creative’s platform. The filings reveal that Apple was unsure that this scheme was going to be profitable in the long run, and proposed the radical (for Apple) idea of partnering with Creative to create a digital audio player. Creative decided against joining forces, and the rest is history.
While one might be quick to assume that a merger between the two companies would have led to a marriage punctuated with hundred dollar bills falling from the mirrored ceiling of their honeymoon suite, it may also be that a mating of these two wildly different corporations would have been destined for failure. Apple’s reckless abandon coupled with Creative’s bulky hardware and stodgy corporate culture would likely have resulted in clashes of personality, among other things.
As it stands, Apple scored big when Creative turned down their proposal, freeing them up to engineer the iPod as they had envisioned it, rather than working off of one of Creative’s prototyped designs—or using Creative’s patented IP, as the lawsuits allege.
Creative and Apple’s relations were dotted by pithy remarks and under-the-belt jabs until this lawsuit business reared its head. Apple was able to take a radically different approach to marketing, growing their market while making a lot of money. As a result, the iPod has become synonymous with the portable digital audio player market. Today, Creative and Apple stand with patent lawsuits loaded, waiting for the other to flinch first—unless they can come to a settlement themselves.