Heating up further the patent dispute, Nokia has said that Qualcomm Inc is the largest user in the world of its technology and patents. The recent comment is expected to further intensify an increasingly bitter public quarrel over patent royalties. Finnish-based Nokia has rejected chip supplier Qualcomm’s public statements that it does not use Nokia patents, the world’s leading mobile phone maker has said. In the meanwhile, the licensing deadline between Qualcomm and Nokia expired without any formal declaration yesterday with a Nokia spokesperson commenting, ‘business is continuing as usual.’
Nokia in an official statement has said, ‘With its more than 200 million units annually, Qualcomm is the largest user in the world of Nokia’s technology and patents’. It went on to allege that it believes that Qualcomm is currently using over one hundred of Nokia’s GSM/WCDMA and CDMA2000 essential patents in its chipsets. The disagreement between the companies is very much still in place over how much Nokia should have to pay Qualcomm for using Qualcomm’s patented technology.
The San Diego-based CDMA developer Qualcomm has been approaching for the Finnish handset manufacturer to renew a 2001 licensing agreement under what Nokia considers as ‘outdated terms’, and has refused to reduce the amount payable in royalty fees for Nokia’s use of some WCMDA technology. Nokia has argued that it calculations value WCDMA licenses at less than three per cent of the overall cost of a handset. While Qualcomm contends that it is worth five per cent.
Earlier this month, Qualcomm had filed two patent-infringement lawsuits against Nokia. Later on Nokia paid Qualcomm $20 million; the paid amount Nokia unilaterally decided was what Qualcomm’s patents were worth for the second quarter of 2007. On the other hand, in response Qualcomm said that the $20 million was a fraction of what it would be owed for the quarter and filing a demand for arbitration. In its official statement, Qualcomm said, ‘Nokia’s attempted payment is a fraction of the royalty to which Nokia agreed in the arm’s length negotiations leading to the parties’ existing contract and for which Nokia bargained in obtaining the extension option’.
Qualcomm has gained a reputation for being a litigious company and last month it had warned a wave of lawsuits should Nokia carry on to proceed with manufacturing as normal after the date of the license expiration. A faction of analysts believes that this is just the beginning in what is an epic battle for dominance in the global cell phone market. While other school of thought argues that the California-based company is convincingly aware of which side its bread is buttered and would not actually want to take on the world’s biggest handset manufacturer.
