Nokia, Apple Settle Patent Dispute
Apple Inc. (NASDAQ:AAPL) and Nokia Oyj reached a patent deal that settles the two year lawsuit between the Finnish mobile phone manufacturer and the manufacturer of iPhone and iPad.
Nokia Corp. (NYSE:NOK) won a major victory over the patent lawsuit against Apple, with the latter agreeing to pay the world’s largest mobile manufacturer a onetime payment along with royalties for the disputed patents.
The announcement for the first time raised the value of the stocks of Nokia since Stephen Elop, the Chief Executive Officer of Nokia announced their shift to Microsoft’s (NASDAQ:MSFT) smartphone operations system instead of their own developed Symbian and the MeeGo OS being developed along with Intel (NASDAQ:INTC). The stocks increased by 4.1 percent on the Finnish, Helsinki stock exchange after Nokia made the announcement through a statement released on Monday. The deal favoring Nokia Corp. will bolster the second quarter profitability of Nokia‘s Devices & Services unit.
In the released statement, Nokia failed to mention the complete terms of the agreement between the two companies, which are termed to be confidential. The only terms of the agreement that were unveiled were that Apple will pay Nokia an undisclosed sum along with certain royalties for the term of the agreement.
Nokia and Apple have been in a patent litigation since October 2009, when Nokia first filed a patent lawsuit accusing Apple of infringing on its patents in its iPhones. Nokia demanded from Apple millions of dollars in royalties on behalf of all the iPhone units sold since the launch of the device in 2007. In March this year, Nokia said that it has lodged complaints against 46 patents in the United States International Trade Commission. Eventually Apple had to succumb to the pressure from Apple, which led to the settlement of the lawsuit in favor of the Finnish handset manufacturer who has been hit hard by the launch of Apple’s iPhone smartphones. Since June 2007, when the iPhone was first announced, Nokia has lost more than three quarters of its market value.
Elop has been strategizing a move to combat increasing popularity of the iPhone by shifting the smartphone operating system from its own Symbian operating system to the Microsoft Windows operating system. It is however uncertain if Nokia will be able to gain its market dominance in the smart-phone market as it one had.
