Why Nokia is suing Apple over iPhone GSM/UMTS/WLAN patents and what’s really at stake

12 Black Fridays of the Season“Nokia has filed suit over patent infringement on Apple’ iPhone, claiming that ‘by refusing to agree appropriate terms for Nokia’s intellectual property, Apple is attempting to get a free ride on the back of Nokia’s innovation.’ Actually the reverse is true,” Daniel Eran Dilger writes for Roughly Drafted.

“As the world’s leader in handset sales by a wide margin, Nokia most certainly does have one of the ‘strongest and broadest patent portfolios in the industry,’ as the company says. And having licensed its technology to nearly every mobile maker in the industry, it’s not surprising that Apple will have to pay Nokia to play in the phone market,” Dilger writes.

“However, Nokia is painting a picture that doesn’t doesn’t really mesh with reality, suggesting that Apple is a rogue manufacturer intent on breaking patent laws,” Dilger writes. “In reality, Apple maintains one of the most experienced legal teams in the field of intellectual property, knows how the industry works, and either pays for IP or proves that it doesn’t need to.”

Full article here.

Ashby Jones blogs for The Wall Street Journal, “It’s a fact of life that litigation is often used as a business tool — a set of flashing lights to get a competitor to sit up and take notice, or a cudgel to bring a more powerful company to the negotiating table. Analysts say such could be the case with Nokia here.

“‘I really think this is more a function of Nokia trying to compete with Apple more than anything even if it’s through the courts,’ said Shaw Wu, an analyst with Kaufman Brothers, adding that Nokia may be taking action now because the iPhone is starting to gain ground in Europe and Asia,” Jones reports. “‘It’s a non-event for Apple. It’s immaterial even if they pay a lump sum,’ he said.”

Jones reports, “Maybe so. But the NYT writes that the potential return to Nokia could be enormous. Typically, the royalties for essential patent portfolios in cellphones make up 1 percent to 2 percent of the wholesale price. The wholesale cost to wireless carriers of the iPhone is estimated to average about $600. A 2 percent royalty would represent $12 for each phone sold. In just the most recent quarter, Apple sold 7.4 million iPhones. It has sold more than 34 million total.”

Full article here.

MacDailyNews Take: Can’t compete? Litigate.

27 Comments

  1. Here I fixed it..

    “Nokia has filed suit over patent infringement on Apple’ iPhone, claiming that ‘by refusing to agree appropriate terms for Nokia’s intellectual property, Apple is attempting to get a free ride on the back of Nokia’s innovation.’ Actually the reverse is true,” Daniel Eran Dilger whines for the Macboy extreme site, Roughly Drafted.

    ” Nokia licensed its technology to nearly every mobile maker in the industry, but they’re not Apple. Apple is the best and shouldn’t have to pay anything to anyone ever” Dilger whines. Let’s face it, any company in existence sucks and theie equipment is “junky and clunky”. Apple skates to where the puck is going to be! The back of our phone looks better than the front of everyone elses! It’s soooo elegant and delicious looking!

    Roughly drafted, … about as credible as say, MDN

  2. Steve Jobs has referred to Nokia as a good company that makes good products. But it Nokia wants to play dirty, Apple will bury them—not in the courts, but in the marketplace.

  3. Why isn’t Roughly Drafted credible? Let’s see an example. Or like every other strangely obsessed member of the I Hate Daniel Eran Dilger And I Must Remind The World About It Anytime Somebody Mentions His Name Club, are you somehow always at a loss to provide evidence of the oh-so-outrageous inaccuracy of his articles?

    Also, why are you credible? Let’s see an example there, too.

  4. Ahhhhhh….Now it makes sense.

    Hire money grubbing attorneys for $2 – $5 million in legal fees and hopefully recoup $408,000,000.00. If not, just write it off as a business expense and raise product prices to cover the loss and screw the consumer.

  5. Umm, they are claiming infringement from the original iPhone from 2 years ago in the lawsuit. I thought there was something about promptly defending your patent, not waiting years then crying foul.

    The Dude abides.

  6. iCalled!!

    MDN..just make sure you don’t whine even the slightest bit when Apple sues a cell phone vendor due to infringement in the future.

    MDN are you aware that your take pretty much gives the green light for everybody else to use Apple’s iPhone patents without any worry? Apple can compete right, so they don’t need to react to “silly” patent infringments.

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