Daimler to pay Nokia’s patent fees, ending German legal dispute
Daimler (DAIGn.DE) has agreed to pay Nokia (NOKIA.HE) for the use of its patents, ending a dispute that has highlighted a battle between tech and auto companies over royalties for key technologies.
Nokia, which makes 1.4 billion euros ($ 1.7 billion) in licensing revenue each year, and automaker Daimler have been suing in recent years in German courts, with mixed results.
Tech companies want automakers to pay royalties for technologies used in navigation systems, vehicle-to-vehicle communications and self-driving cars, but the latter say their suppliers should pay instead, which could lower fees for patent holders.
The deal announced jointly on Tuesday marks the latest victory for Nokia, which in April struck a deal with China’s Lenovo (0992.HK) under which the world’s largest PC maker would make a net balancing payment to the maker. Finnish telecommunications equipment and would resolve any outstanding disputes. . Read more
This followed a deal with Samsung (005930.KS) the previous month in which the South Korean company agreed to pay royalties for its video standards technologies.
Nokia and Daimler did not disclose the terms of their patent license agreement, but said they would end the litigation. The German automaker has never paid Nokia for the use of its patents to date.
“We welcome the settlement, both economically and because we avoid long … conflicts,” said a spokesperson for Daimler.
The deal is good news for Nokia, said Mads Rosendal, analyst at Danske Bank.
“The revenue stream is unlikely to be significant, but at the very least it will be very stable and with a high margin. Moreover, the end of the litigation should save a good chunk of legal costs in the future. Credit. slightly positive for Nokia, in our opinion., “he said.
According to sources familiar with the settlement, Nokia charges a fee of just over $ 2 per vehicle under patent licensing agreements for similar technologies.
The end of the dispute means that a request by a German court last year to the Luxembourg-based Court of Justice, the highest in Europe, for advice on the matter will be moot.
However, the German auto parts maker Continental (CONG.DE), which, along with Daimler, Bury Technologies, Valeo (VLOF.PA) and Gemalto, owned by Thales (TCFP.PA), complained about the patent fees. Nokia to EU antitrust regulators in 2019, said it was not abandoning its complaint or legal fight in the United States.
He urged the European Commission to define a binding framework for patent licenses.
“He must … define this framework, otherwise European companies will face an insurmountable competitive disadvantage in the future Internet of Things market compared to Asian and American market players”, Helmut, member of the board of directors of Continental and responsible for its vehicle network and information division. Matschi said in a statement.
Audi, Bentley, BMW (BMWG.DE), Mini, Porsche, Rolls Royce, Seat, Skoda, Volkswagen (VOWG_p.DE) and Volvo are already paying patent rights to Nokia.
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