Apple Inc. (AAPL) has filed a countersuit in a U.S. District Court in Delaware against Nokia Corp. (NOK) alleging that the latter has infringed 13 of its patents. Apple said that Nokia is using its patents for functions such as display graphics, power conversation, teleconferencing and real-time signal processing in several of its phone models.
Apple also said that Nokia’s delay in adjusting to consumer preferences had forced it to copy the iPhone. Apple is seeking a dismissal of all Nokia’s claims as well as damages for infringement and other costs including expert and attorneys’ fees. In Oct, Nokia filed a complaint against Apple with the Federal District Court in Delaware, alleging that Apple’s legendary iPhone has violated as many as ten Nokia patents from 2007.
Nokia said that Apple is using its wireless technology in iPhones. Nokia claimed that Apple will have to pay Nokia a 1%-2% royalty per phone, implying approximately $6-$12 per iPhone sold. However, Apple said that Nokia’s claims were invalid. The ten patents are related to technologies fundamental to making mobile handsets, which are compatible with one or more of the GSM (2G), UMTS/WCDMA (3G) and wireless LAN (for Wi-Fi connectivity) standards.
Technically these patents cover wireless data, speech coding, security and encryption for smartphones. We expect this infringement war between Nokia and Apple to continue for a while. We expect the patent litigation dispute will culminate in a cross-licensing agreement between the two.
In our opinion, Nokia has lost significant ground in the smartphone market and is trying desperately to rebuild its lost supremacy in the smart phone market and take market share from Apple’s iPhone. The current scenario shows that the battle for supremacy in the global smartphone market is getting intense by the day. According to Gartner Inc, Apple’s market share continues to soar and is edging close to rival Research In Motion (RIMM), while Nokia’s share continues to decline.
Read the full analyst report on “AAPL”
Read the full analyst report on “NOK”
Read the full analyst report on “RIMM”
Zacks Investment Research
