Nokia sues Apple over the iPhone

News reported on the BBC news website states that Nokia, the world's giant in the manufacturing of mobile phone technology, is suing Apple for infringing patents on mobile phone technology used in the iPhone. Nokia added that this patent breach applies on all iPhones since its launch in 2007.

Nokia have said that this is due to a lack of compensation from Apple, who they are accusing of "trying to get a free ride on the back of Nokia's innovation". These alleged infringements, of which there are ten- involve wireless data, speech coding, security and encryption. Nokia have said that they hold agreements with roughly forty firms who use the technology which Nokia has worked hard to develop, including most mobile phone handset makers - allowing them to use the firm's technology. Apple however, have not signed any such agreement with Nokia and as such find themselves in this situation. During the last two decades, Nokia had invested approximately 40bn euros (£36.2bn; $60bn) on research and development. Recently, Nokia has seen its first quarterly loss in a decade amid falling sales. Analysts said that the poor results had come partly as customers turned from Nokia models to the iPhone and RIM's Blackberry. Apple's iPhone continues to remain a hugely profitable piece of technology for Apple.

In a public announcement; Ilkka Rahnasto, vice-president of legal and intellectual property at Nokia said the following:

"The basic principle in the mobile industry is that those companies who contribute in technology development to establish standards create intellectual property, which others then need to compensate for, Apple is also expected to follow this principle."

The BBC have spoken to an industry analyst who believes that Nokia may be suing Apple in order to extract royalty payments from Apple. Piper Jaffray analyst Gene Munster estimates that the Finnish company might be looking to force royalty payments of 1-2% on every iPhone sold. With more than 30 million sold, that would work out to $6 to $12 per phone sold, or as much as $400m, a very small amount in terms of Apple's complete income.

Gene Munster commented further saying: "Ultimately, the resolution is uncertain." An Apple spokesman told the BBC that the firm did not comment on pending litigation.

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