Apple sues Ericsson over royalties dispute

Apple has sued Ericsson to reduce royalties on phone patents. Apple sued the company to weaken its hold on wireless technology that it licenses for use in cellular phones across the industry.

Apple said that “Ericsson seeks to exploit its patents to take the value of these cutting-edge Apple innovations, which resulted from years of hard work by Apple engineers and designers and billions of dollars of Apple research and development — and which have nothing to do with Ericsson’s patents.”

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Ericsson sued Samsung Electronics in 2012 for infringement, saying the South Korean phone maker failed to extend a licensing deal after years of negotiations.

Both company’s settled in January 2014 with a new licensing deal over wireless technology in smartphones, televisions, tablets and Blu-Ray disk players.

This deal was expected to increase Ericsson’s Q4 sales by 4.2 billion kronor ($520.4 million) and net income by 3.3 billion kronor.

Ericsson also sued Xiaomi in India claiming that the Chinese company hasn’t licensed its inventions.

Ericsson said, at the time their company holds essential patents for 2G, 3G and 4G mob wireless technology, which means any seller of products compliant with those standards must secure licenses.

Apple’s reason for disagreement is that Ericsson wants Apple to pay royalties based on percentage of the price of the entire device.

Apple argued it should be set on a smaller base and called Ericsson’s demands unreasonable. Apple’s largest revenue source is the iPhone, which it began selling in 2007.

‘‘We’ve always been willing to pay a fair price to secure the rights to standards essential patents covering technology in our products,” said Kristin Huguet, an Apple spokeswoman.

“Unfortunately, we have not been able to agree with Ericsson on a fair rate for their patents so, as a last resort, we are asking the courts for help.” added Kristin

 

editor@gizmolead.com

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