The agreement includes a one-time payment, as well as the continued payment of royalties, by Apple to Nokia for the term of the agreement. The rest of the terms of the contract are confidential.
While Apple joins the growing number of Nokia licensees, with this agreement, Nokia believes that their growing patent portfolio will help them to improve their growth in the mobile communications market.
In recent times, the Apple product portfolio, led by the iPad2, which is projected to touch sales of 45 million in 2011, has been eating into the share of a great number of leading smartphone players including Nokia.
In May 2010, Nokia sued Apple for infringing five of its patents for technology used in the iPad. HTC had earlier also filed a lawsuit against Apple, accusing it of infringement of 20 patents, and announced in May 2010 that it would file a complaint with the US International Trade Commission suing Apple for patent infringement. Motorola also sued Apple later in 2010 for infringement of 18 patents used in the iPad, iPhone, iPod touch and Mac. Then, in April this year, the tables turned with Apple suing Samsung for patent infringement of its iPad and iPhone being used in Samsung’s smartphones and tablets.
For Apple, it is a case of over-popularity adding to their increasing number of lawsuits. For Nokia, patent infringement is a major issue as it is facing a falling market share and tough competition, with the growing number of smartphones and tablets in the market. The partnership with Microsoft for Windows 7 on Nokia handsets may help the handset major regain some of its lost market share, but the agreement with Apple will no doubt give the Nokia brand leverage in the industry, which is crucial for the equipment vendor today.
By Beryl M
