Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page1 of 19

EXHIBIT 14 DEFENDANT'S EXHIBIT NO. 586.001 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page2 of 19

Samsung-Apple Licensing Discussion

October 5, 2010

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Highly Confidential - Attorneys' Eyes Only APLNDC00010886 DEFENDANT'S EXHIBIT NO. 586.002 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page3 of 19

A Basic Phone has basic features ...

Camera flash

Earp ere Camera lens

Display WeP access/ Confirm key Play/Pause/ (Centre) Stop key Left soft key Right soft key Forward key Power on/ Volume keys off key 1. De'ete/Menu Backward-- ext key Camera key —54 key Navigation keys Music player- 1J Dial key (Up/Down/ key Left/Right) Nphamaneric keys Headset/ Special Microphone Adapterlack function keys' Speaker Memory card slot

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What changed? What makes an GalaxyS so different?

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Non i,no Wes! andrad • , 1aThal$M1no1lIr.. 1.1.o. 21 muR1Faerm

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DEFENDANT'S EXHIBIT NO. 586.004 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page5 of 19

... but Advanced Mobile Computing Devices are different

• Software creates the largest share of product value • Operating system, applications, user interface, and services are the key to a differentiated customer experience • iPhone became the archetype for advanced mobile computing devices • Software has always been at the heart of Apple's business and intellectual property portfolio

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Highly Con tial - Attorneys Eyes Only A DC00010889 DEFENDANT'S EXHIBIT NO. 586.005 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page6 of 19

Apple and its Computing Products have Evolved as well RF Mobile Computer

wer Po - ortable ing Music cess Pro

Portable

Modern OS

Personal Computing Miniaturization

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Highly Confidential - Attorneys' Eyes Only APLNDC00010890 DEFENDANT'S EXHIBIT NO. 586.006 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page7 of 19

Mobile Computers rely upon several key technologies principally developed in the computing industry

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Microprocessor Modern Operating System Graphics Apps w/ Graphical User Interface

MU 1418 MUSIC ;

Touch Music Video Gaming

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Mobile computers create more value for customers -- and sell for more -- by virtue of the additional technologies that enable them

Mobile Computer

Basic

Basic Phone

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Highly Confidential - Attorneys Eyes Only APLNDC00010892 DEFENDANT'S EXHIBIT NO. 586.008 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page9 of 19

We model 3 types of patent licenses to cover wireless and

computing technologies

Apple core computing

Basfc relepnonv ,11 1 ,t

• Phone license Appie advanced feature — Basic Telephony (e.g. wireless standards, java, processor, graphics, misc HW)

• "Smart" license — Apple Computing technologies (e.g. 0/S, object oriented, etc.) I

"Advanced Mobile" license — Advanced iPhone Technologies needed to create an "advanced" class device (e.g. Touch, GUI, apps, music, etc.) * Each license includes distinct technologies, so an iPhone advanced mobile class device would require all 3 licenses, while a basic phone would require only the phone license.

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Samsung adopted, embraced and imitated the iPhone archetype

• Samsung chose to embrace and imitate Apple's iPhone archetype • Apple would have preferred that Samsung request a license to 11 ` Yrtin do this in advance . . 6 + • Because Samsung is a strategic supplier to Apple, we are prepared to offer a royalty- bearing license for this category of device

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Highly Confidential - Attorneys Eyes Only APLNDC00010894 DEFENDANT'S EXHIBIT NO. 586.010 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page11 of 19

Samsung launched a major offensive, targeting Apple's Mobile Computing Paradigm with both and tablets

"Samsung could sell 10 million units of the new [Galaxy S] smartphone globally this year."' — JK Shin, head of Samsung's mobile comm. division "Samsung also expects to sell about 25 million smartphones this year"' — JK Shin, head of Samsung's mobile comm. division "Samsung is aiming for a double-digit market share for global smartphones by the end of this year... Samsung's smartphone sales are likely to double next year from this year."' — JK Shin, head of Samsung's mobile comm. division "[Samsung] expects to ship 10 million [Galaxy Tablet] units and take a third of the global tablet market next year" 2 Hankil Yoon, Samsung product executive

1 SE Young Lee, "Samsung Expects Profit Boost From Mobile Phones", The Wall Street Journal, Sep 3, 2010

2 Spencer E. Ante, "Phone Giants to Sell Samsung Tablet PC", The Wall Street Journal, Sep 11, 2010

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DEFENDANT'S EXHIBIT NO. 586.011 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page12 of 19

Samsung is a major vendor of advanced mobile computing devices such as smartphones and tablets

Year Smartohone Tablet Samsung Srnartphones (2009) Volume Volume Total: 5,872,000 (000) (000) 2009 5,900 --

2010 25,000 2,000

2011 50,000 10,000

2012 60,000 12,000

2013 72,000 14,000

2014 86,000 17,000

Samsung Phones (2009) TOTAL 293,000 55,000 Total: 235,772,000

Samsung Smartphones by OS

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80

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Source : HMC Investment Securities

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Apple Smartphone Licensing Rates

• $30 USD per Licensed Smartphone • Licensed Smartphones: touchscreen devices based on -- • Android units • Symbian units • Bada, unless Apple proprietary features avoided • Windows, others - to be discussed

• $40 USD per Licensed Touchscreen Tablet • Reducing to $30 over 2 years

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We will provide Samsung with a number of options for obtaining a cost-effective license to our patent portfolio

Like other major Apple suppliers Samsung has a Samsung substantial patent portfolio, albeit it is largely Portfolio oriented in supplier-type areas Some Samsung products may make use of an OS Apple- largely licensed to Apple patents (e.g. Windows licensed 0/S Mobile) Apple- Samsung may wish to encourage its other processor licensed manufacturers to take a license Processors Not Using Some Samsung "smartphone" products may not Proprietary adopt distinctive industrial designs, software Features platforms or feature sets Conventional Most Samsung phones are Basic Phones that are Mobile not intended to serve as advanced mobile Devices computing devices

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DEFENDANT'S EXHIBIT NO. 586.014 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page15 of 19

Samsung may avail itself of these options, and in doing so obtain an Apple patent license on the most cost effective basis possible.

Advanced Mobile Computing Devices (e.g. Android-based Galaxy S)

Devices w/ Non- Devices w/ Apple Conforming Apple Licensed 0/S Devices Licensed (e.g. MSFT) Processors

Conventional Devices (e.g. traditional handsets)

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We will provide Samsung with a number of options for obtaining the most cost-effective possible license to our patent portfolio

Samsung 20% Discount Portfolio Advanced Mobile Computing $US 30/ unit Device Apple- 40% Discount Royalty Rate licensed 0/S

Apple- licensed 20% Discount Tablet Processors Royalty Rate $US 40 unit Not Using Proprietary 20% Discount Features

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Highly Confidential - Attorneys Eyes Only APLNDC00010900 DEFENDANT'S EXHIBIT NO. 586.016 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page17 of 19

EXAMPLE 1: Windows-based non-touch device

Samsung Blackjack IITM Samsung Cross license Smartphone Portfolio • 20% discount

Microsoft licensed 0/S tech Apple- • 40% discount licensed 0/S

Apple- licensed n/a Processors Not Using Proprietary Physical QWERTY form factor tit., r$4 Features •20% discount s:,t99tittWt"' Att91:04 .td-s 4000 s 4 t$ Total 80% discount atst

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EXAMPLE 2: Android-based full touch screen devices

Samsung Cross license Portfolio • 20% discount

Apple- Completely unlicensed licensed 0/S Android OS - No discount

Apple- n/a licensed Processors Not Using Full touch screen device Proprietary - No discount Features

Total 20% discount

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Highly Confidential - Attorneys' Eyes Only APLNDC00010902 DEFENDANT'S EXHIBIT NO. 586.018 Case5:11-cv-01846-LHK Document2063-10 Filed10/20/12 Page19 of 19

Example year: 2010

Android Windows Bada, Tablet Mobile 7 Symbian & Other Samsung Est. Units (m) 10 10 5 2 Royalty per Unit $30 $30 $30 $40 Portfolio Discount ($6) ($6) ($6) ($8) Licensed OS Discount $0 ($12) $0 $0 Licensed MPU Discount $0 $0 $0 $0 Not using Apple Proprietary $0 ($3) ($3) $0 Features* Total Discounted Royalty per Unit $24 $9 $21 $32

Gross Royalties (m$) $240 $90 $105 $64 Product Impact (est. 50%) ...„_012.91_111.==m3) _a32) Net Royalties Due (m$) $120 $45 $53 $32 CY 2010 License Total (m$) $250 * Specific Apple Proprietary Features to be discussed

• Samsung launched a major offensive, targeting Apple's smartphones and tablets • Simple calculation of Apple's lost profits based on current market share yields profound lost profits •These figures pale in comparison to Apple-Samsung's balance-of-trade • Samsung should respond favorably

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