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Nokia, Qualcomm settle long-running dispute
(Agencies)
Updated: 2008-07-24 15:02 The stakes were especially high for San Diego-based Qualcomm, which gets about two-thirds of its profits from licensing fees on its patents. Nearly all the rest of its profit comes from making chips. Carriers and equipment makers will also be spared having to worry how legal uncertainties hanging over two influential companies might hamper their ability to deliver products and services, said Michael King, an analyst at technology researcher Gartner Inc. "It's a huge weight off everyone's shoulders," he said. "It was a game of brinksmanship. ... I think they both had to realize that continued litigation was only going to damage the entire industry." The agreement was announced after a judge in Wilmington, Del., delayed the opening day of a trial to address the licensing fees and Nokia's complaint that Qualcomm has ignored its commitment to license its patents on fair terms. A licensing agreement between the two companies expired in April 2007. The new pact covers a host of technologies that didn't exist or were in their infancies when the two companies signed their initial agreement in 1992 and renewed it in 2001. Qualcomm delayed the release of its fiscal third-quarter results for several hours to first announce the agreement with Nokia. Profits fell 6 percent to $748 million, or 45 cents a share, during the three-month period ended June 29, down from $798 million, or 47 cents a share, the same period last year. Revenue grew 19 percent to $2.76 billion from $2.33 billion. Excluding per-share charges of 4 cents from its strategic investments unit and 6 cents for stock-based compensation, Qualcomm earned 55 cents a share during the latest period, matching the estimate among analysts polled by Thomson Financial. |
