Nokia has announced that it has gotten Samsung to sign an extension on their patent licensing agreement for another five years, although the pricing of the deal hasn’t been decided yet.
The Finnish firm has taken to its new life as a patent company with gusto, pursuing litigation with those that won’t pay up with renewed vigour and tying in the Korean chaebol for another few years. Samsung has agreed to pay additional compensation to Nokia, the firm said, but the amount of the compensation has yet to be settled.
Nokia said that binding arbitration, which is expected to be concluded by 2015, would decide the figure for the licence. “This extension and agreement to arbitrate represent a hallmark of constructive resolution of licensing disputes, and are expected to save significant transaction costs for both parties”, said Paul Melin, chief intellectual property officer at Nokia.
Patents will be one area of focus for Nokia after the former mobile-phone market leader agreed to sell its handset division to Microsoft in September this year. Without phones, the company’s largest business will be network equipment, and it is also retaining its patents to generate licensing income.
“This deal demonstrates the opportunities for the new Nokia in intellectual property rights,” said Sami Sarkamies, an analyst at Nordea Bank AB in Helsinki. “It’s significant because it relates to Samsung, the client with the biggest potential in such rights. It’s good timing for Nokia and shows they will be able to benefit from the device-unit divestment from the first day.”
Samsung, based in Suwon, South Korea, overtook Nokia as the largest mobile-phone maker last year and has also become the biggest producer of smartphones, the most lucrative and fastest-growing part of the handset market.
