Ericsson Wants More Money from Apple for 5G Patents

Ericsson goes to court to sue Apple again. Ericsson wants Apple to pay for its 5G technology. Apple is refusing now that it has expanded its patent treasury.

 

Since 2015, Apple had an agreement with Ericsson to use its patents around 2G, 3G and 4G for a fee. However, that agreement expired, and the two did not reach a new agreement. Ericsson says that Apple wants to pay less, Apple says that Ericsson is abusing its dominant position (through its huge patent portfolio). That led to both suing each other last year.

Now Ericsson is starting a new lawsuit in which it wants five dollars per iPhone sold, Reuters writes, for the technology used, which now also includes 5G. If Apple agrees, it also wants to give a dollar discount.

It remains to be seen whether Apple will comply with this because, since the 2015 agreement, Apple bought (in 2019) the majority of Intel’s smartphone modem business, including several patents related to wireless technology. Although Ericsson has about 57,000, Apple speaks for its own portfolio, including the acquisition of the modem division of Intel, about 17,000 patents.

Such lawsuits are a regular occurrence among telecom companies. It is important to know that it is only partly about technology and partly about the ‘right’ to demand money from a major smartphone vendor.

A smartphone contains various standardized technologies around 2G, 3G, 4G, and 5G. Therefore, anyone who makes a device also has to pay fees to the companies that have contributed to that standardized technology. Ericsson is such a company and has invested in developments that it could patent now and in the past.

This means that a company such as Ericsson, which still makes mast equipment, but has not released its own smartphones for a long time, still obtains about one-third of its operating turnover from licenses for other device makers, such as Apple.

Often such cases are also full of strong claims and demands, for example, a sales ban in a major market or a lot of money for illegal use of technology. However, in practice, it is mainly arguments that have to settle the lawsuit in their favour. For example, the court may decide that Apple now owns so many patents that it has to pay less to Ericsson. Another option is that such matters are a solid stick to settling themselves.