Nokia sues Apple over patent infringements

Cellphone maker Nokia has slapped Apple, one of the world's most popular technology companies, with a $1-billion suit, claiming the iPhone maker has infringed 10 patents.

On Thursday, Nokia made an announcement that they had filed a complaint in a Delaware courthouse against Apple because of patented infringements. If Nokia’s lawsuit against Apple is successful, then the maker of the infamous iPod would have to fork over $1 billion, according to The Mirror. The globe’s number one cellphone maker, Nokia, is suing because Apple has infringed ten patents in technologies such as wireless data transfer. The company has accused Apple of hitching a “free ride” on Nokia’s technology investment. Nokia controls 38 per cent of the global handset market. Nevertheless, since the introduction of the iPhone, Apple has won 15 per cent of the smart phone industry, reports Reuters. According to Business Week, unit sales of Nokia smart phone devices fell to 8.9 million, which is a decrease from the second quarter of 2009 when they sold 9.3 million. Neil Mawson of Strategy Analytics said Apple could have to remunerate Nokia between $200 million and $1 billion for patents used in the 34 million iPhones that have been purchased so far. Apple would have to compensate Nokia a one per cent royalty, which equals $6 to $12 per phone sold. In the last quarter, Apple sold just over 7 million iPhones for an average price of $566. Nokia’s Vice President for Legal and Intellectual Property at Nokia, Ilkka Rahnasto said, according to The Wall Street Journal, “By refusing to agree to appropriate terms for Nokia’s intellectual property, Apple is attempting to get a free ride on the back of Nokia’s innovation.” Furthermore, if the lawsuit does favor Nokia’s side, this would not change Apple’s financial forecasts, writes Maynard Um, an analyst at UBS Investment Research. He believes the iPhone would slide to $525 in value and stock would rise to $280 in the future. No Apple spokesperson has provided the media a comment on the litigation lawsuit.