Nokia (NOK) management has said that its patent dispute with Qualcomm (QCOM) could delay the roll-out of some 3G technology. Nokia has about 35% of handset sales worldwide. Qualcomm currently collects about $500 million a year from NOK in licensing fees. But, now, Nokia claims that the fees are too high and that the US chip and IP licensing company violates some of its patents.
The new 3G standard will allow faster broadband connection speeds permitting handsets to receive services like data and video.
If the dispute continues, advocates of the rival WiMax standard could be very big winners.
Intel (INTC) and Motorola (MOT) have championed this format around the world. As it has grown, entire cities have considered using the technology for broadband and it is used for high-speed deliver throughout Seoul. In the US, Sprint (S) will roll out a nationwide WiMax network in the next two years to handle its broadband-to-the-phone service.
If Verizon Wireless and AT&T Wireless (T) run into 3G problems because of the Nokia/Qualcomm dispute, Sprint might finally get a break against it two larger competitors.
WiMax advocates have some very optimistic projections. Rethink Research has published a report that says global spending on WiMax infrastructure will move from $635 million this year to $7.36 billion in 2009. The document goes further by saying that 63% of all broadband equipment spending that year will go to WiMax.
WiMax may not hit the lofty projections that its advocates have trumpeted, but, if 3G deployments are delayed at all, it could take precious market share that companies like Qualcomm will never get back.
Douglas A. McIntyre can be reached at [email protected]. He does not own shares in companies that he writes about.
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