Nokia & Apple Settle Patent Litigation

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Nokia just won a breakthrough, having won a settlement deal from Apple for a long-standing patent dispute involving smartphone interfaces. Nokia gets cash plus licensing for every iPhone sold, and both companies get to use each other’s patented technologies.

If you can’t win ‘em, then sell licenses. This seems to be part of Nokia’s strategy, in the face of Andoid and iPhone rising to the top positions in the smartphone market. Nokia had been in a patent dispute with Apple since 2009, alleging that Apple was infringing on 10 Nokia patents relating to smartphone user interfaces such as touch scrolling and device illumination. When the iPad came out in 2010, Nokia claimed additional infringements. Most recently, the count was up to 46 patents.

Apple sued back, claiming Nokia was likewise infringing on several of Apple’s patents. Complaints were thrown back and forth, with the US International Trade Commission as arbiter, as well as similar oversight authorities in the UK, Germany and the Netherlands. Finally, though, the two parties agreed on settlement. While no exact figures were disclosed, the deal involves Apple paying Nokia a lump sum for past infringements, plus royalties for future smartphone (and tablet) sales.

Meanwhile, since Apple also holds patents that Nokia uses in its products, the deal is supposed to have been fair to both sides, with either party using these on somewhat of an ex-deal basis. In the end, though, Nokia got the net benefit, and so Apple ends up paying. Nokia CEO Stephen Elop made a statement stressing the importance of Nokia focusing on its core business, rather than busying itself with expensive and time-consuming litigation.

We are very pleased to have Apple join the growing number of Nokia licensees … [The settlement] enables us to focus on further licensing opportunities in the mobile-communications market.

Apple has issued a statement, stressing that the two companies are at peace (for now), but not without underscoring the iPhone’s technological advances.

Apple and Nokia have agreed to drop all of our current lawsuits and enter into a license covering some of each others’ patents, but not the majority of the innovations that make the iPhone unique.

We’re glad everything turned out all right between Apple and Nokia. Now the real battle to be waged is whether Nokia and Microsoft will, indeed, be able to take the #2 smartphone spot in five years time, edging out Apple’s iPhone to third place.