Nokia Fires Latest Salvo In Patent Fight With Qualcomm

Never mind the technology, Qualcomm’s real focus these days is on intellectual property. It’s involved in a number of disputes with several different companies, reflecting not only its strong patent portfolio, but also widespread unease in the mobile industry with how it licenses that portfolio. Broadcom has been one legal foe of Qualcomm’s, as the two companies have had several separate patent-infringement cases and allegations of antitrust violations. Following a win for Broadcom in one case earlier this year, and the settlement of another last week, the two companies have also agreed to drop two other patent suits. Even after all that, they’ve still got a few more suits, as well as a case at the International Trade Commission to work out, so don’t feel sorry for the lawyers just yet.

A bigger potential problem for Qualcomm, though, is its ongoing spat with Nokia. The big issue here is the expiration next month of a Nokia licensing deal for some of Qualcomm’s CDMA technology, which it needs to sell 3G and some other types of handsets. For Qualcomm, there’s a significant amount of royalty revenue at stake, and it also has some patents it licenses from Nokia that are relevant to some of its chips tied up in the deal. In reality, neither company can let the deal expire — but they have vastly different ideas of how much it should cost Nokia to license the Qualcomm patents. Against this backdrop has come a litany of antitrust complaints about Qualcomm’s licensing practices and patent lawsuits, all of which are little more than bargaining chips.

Now, Nokia has made its latest move by filing two more suits in Europe against Qualcomm, asking courts in Germany and the Netherlands to rule its patents “exhausted” in the EU, with relation to products sold there under a Qualcomm licenses. What it boils down to is that Nokia is using chips from Texas Instruments, which has the relevant licenses from Qualcomm for the intellectual property in question. It’s asking the courts to rule that because TI has those licenses, it doesn’t need to have them (and pay Qualcomm for them) as well. Such a ruling would significantly undermine Qualcomm’s bargaining position, but it seems like little more than a preemptive strike against a Qualcomm suit for patent infringement against Nokia soon after the licensing deal expires.

Despite all this activity, things are really just getting started, particularly in the spat with Nokia. But given the way things have gone in the Broadcom cases, as well as the recent indefinite stay ordered by an ITC judge in a patent case with Nokia (which itself came after Qualcomm withdrew three of its six patents from the case), it would appear things may not be going Qualcomm’s way. If that is the case, coupled with an industry that’s tired of paying the company royalties, it looks like Qualcomm could be in for a bumpy ride.

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Comments on “Nokia Fires Latest Salvo In Patent Fight With Qualcomm”

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Alaric says:


“GSM IPR holders are, as you point out, a fairly closed group, from which the Koreans and the Chinese are excluded. However, no single GSM player collects the percentage or magnitude of royalties that Qualcomm does. A big number. A big difference.”

This is actually wrong on several levels. GSM IPR holders charge more on a percentage basis than qualcomm, a lot more. Most claims in the Korean press allege its on the order of 15% to 25% which vastly surpasses Qualcomm’s roughly 5% fees.

The difference is that the GSM market is dominated by GSM IPR holders (gee i wonder why?) so most firms (nokia, alcatel, siemens, ericsson, sony-ericsson, motorola) don’t actually pay them.

I’m not trying to defend Qualcomm. They’re abusing the IPR stance as well but abuse is not limited to qualcomm. GSM IPR has long been used as a vehicle to keep asian producers out.

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