Fight With Qualcomm: Nokia's Turn

Telecom & Wireless

Published: April 13, 2007 5:45 am

Some observers think that now that the deadline has passed for Nokia (NOK) to renew its license with Qualcomm (QCOM) for using its IP and hardware in NOK handsets, that both companies would begin to settle their differences quickly.

Not so. Nokia now claims that Qualcomm is the world’s largest user of its patents. Nice reverse play.

According to Reuters: "With its more than 200 million units annually, Qualcomm is the largest user in the world of Nokia’s technology and patents," Nokia said in a statement. Not just a few patents, but over a hundred.

Since Qualcomm is seeking royalties from Nokia for each handset it sells, the new claim complicates that debate.

The fight has done Qualcomm’s shareholders no favors. Its stock is down about 17% over the last year, while Nokia’s is up over 12%.

Qualcomm’s management has been stubborn about settling claims with Nokia and chip rival Broadcom (BRCM). The is unfortunate, because its stock is not likely to do well until these matter are resolved.

Douglas A. McIntyre does not own securities in companies that he writes about. He can be reached at [email protected].

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