Patent Licensing Deals and Nokia
Ending the legal battle in Germany, carmaker Daimler has agreed to pay royalties fees to Nokia for using its patent. This marks the end of the legal battle between the technologies and car companies over the payment of royalties.
Through licensing revenues, Nokia earns $1.7 billion each year. These royalties come from the usage of navigation systems, vehicle communication, and self-driving cars in the automobile, the patent of which is with the tech firms. Instead, the automakers contend that the suppliers should pay, thereby reducing the patent fees.
[Image Source: gettyimages]
The agreement with Daimler is the latest win for Nokia. Moreover, recently Nokia too struck a deal with China’s Lenovo. The deal results in making the net balancing payment to the Finnish telecoms and resolves all the pending litigation. Also, Nokia entered a deal with Samsung for making royalty payments of the patented technologies which Samsung is using related to video standards.
No such disclosure was made by Nokia and Daimler in terms of their patent licensing deal since the carmaker has not paid any fees to Nokia. The only disclosure which was made was with effect to halt the litigation. Daimler spokeswomen said, “We welcome the settlement, from an economic point of view and because we avoid lengthy ... disputes.” The German Court’s request to the Luxembourg-based Court of Justice for its guidance will be rendered as moot.
Speaking on the deal, Danske Bank analyst Mads Rosendal said, “The revenue stream is not likely to be material but at the very least it will be very stable and high margin. Also, the ending of the dispute should save a fair amount of legal costs going forward. Slightly credit positive for Nokia, in our view,”
Nevertheless, Continental, a German car parts maker stated that it would not be dropping its legal fight in the United States. Continental along with Daimler, Bury technologies Valeo and Thales-owned Gemalto complained to EU antitrust regulators in 2019 against Nokia’s patent fees urging the EC for a binding patent licensing framework.
“It must ... define this framework otherwise European companies will face an insurmountable competitive disadvantage in the future market of the Internet of Things compared to Asian and American market participants,” Continental board member and head of its vehicle networking and information business unit Helmut Matschi said in a statement.
Nokia and Samsung Patent Licensing
Recently, Nokia initiated a deal with Samsung for licensing its patent covering innovation in video standards. Nokia released a statement ascertaining the deal with Samsung for licensing. Samsung is a South Korean multinational brand dealing in various consumer electronics gadgets.
Not much information was revealed by the company concerning the financial terms of the agreement. Samsung will be making the royalty payment to Nokia for the licensing, reports Reuters.
Nokia has been a major player in the mobile telephone industry where it was once the largest worldwide vendor of mobile phones and Smartphones in the world. While Microsoft buying its mobile phone business, the market of Nokia was hugely hit. Nokia continues to be a major player in the development of GSM, 3G, LTE, and also 5G. The patent portfolio of Nokia comprises 20,000 patent families including over 3500 declared essential to 5G.
Samsung has a stronghold over the electronic industries and even has a variety of subsidiaries in the insurance as well as advertising fields. Recently Ericsson sued Samsung in Germany, Belgium, and the Netherlands for infringing its mobile patents claiming infringement in implementation patents. Moreover, Ericsson also sued Samsung in the US over violating contractual obligations to negotiate in good faith and to license patent in FRAND terms.
The U.S. International Trade Commission said last month it would open an investigation after Ericsson claimed Samsung had infringed on some of its patents in 4G and next-generation 5G wireless cellular communications infrastructure systems. The move of Samsung getting into a deal with Nokia after already facing a lawsuit by Ericsson can be interesting. We will update the readers as and when further information on the deal becomes available.