Nokia Beats Apple in Patent Law Suit

June 14, 2011

Apple has settled a patent dispute with Nokia that has been going on since 2009. The struggling Nokia giant sued Apple, claiming that it had infringed on 10 patents, and then added another 36 to the the suit in the following years. These patents covered everything from touchscreen scrolling to Wi-Fi to “multitasking operating systems, data synchronization, positioning, call quality and the use of Bluetooth accessories.”

Apple of course counter-sued, but it appears that it wasn’t in as strong a position as it would have liked and was finally forced to back down. Both companies have now settled all legal action against each other.

The terms of the deal are a secret, but we know that Apple will first pay a cash settlement and then an ongoing license fee to Nokia. If the troubled Nokia’s business continues to go downhill, this could become quite a significant source of income.

In fact, Nokia CEO Steven Elop hinted that patent-trolling might be big business in the future. “We are very pleased to have Apple join the growing number of Nokia licensees,” he said in a statement, continuing that it “enables us to focus on further licensing opportunities in the mobile-communications market.” If that doesn’t signal patent-trolling, I don’t know what does.

The lack of official figures hasn’t stopped analysts from guessing at the amounts involved. Speaking to the Wall Street Journal, Swedbank’s Jari Honko pulled the figure of €500 million (around $722 million) out of the air.

Meanwhile, speaking to MarketWatch, MKM partners’ Tero Kuittinen also had a crack at guessing the numbers. “I am assuming that the licensing fee would be probably 4 euros per iPhone” he said. And the Globe and Mail reports that “Analysts said Nokia could be estimated to get between 1 and 2 per cent of iPhone revenue.”

We may get an idea of the amounts involved when Nokia makes its second quarter earnings announcement, the targets for which it lowered two weeks ago. Of course, this probably won’t make a huge difference to a company whose shares have fallen by 43% already this year. To really bounce back, Nokia needs to concentrate on making a kick-ass phone that uses all of its clever patents, instead of whining when somebody else does it.

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