Now this is interesting. Tech giants Nokia and Apple, who mostly used to meet in courts, now have settled all their past disputes and litigation, and joined hands to work together in the areas of technology as well as business.
Further, both the companies have signed a multi-year patent license to use each other’s technologies.
“We are pleased with this resolution of our dispute and we look forward to expanding our business relationship with Nokia,” said Jeff Williams, Apple’s chief operating officer.
However, the settlement does not come without a price. Apple will give an upfront cash payment to Nokia to settle the litigation that has been running for years now. Besides, the Cupertino based firm will also make additional payments during the term of the agreement.
“This is a meaningful agreement between Nokia and Apple,” said Maria Varsellona, Chief Legal Officer at Nokia, responsible for Nokia’s patent licensing business. “It moves our relationship with Apple from being adversaries in court to business partners working for the benefit of our customers.”
Under a business collaboration agreement, Nokia will be providing certain network infrastructure products and services to Apple. Apple will resume carrying Nokia digital health products (formerly under the Withings brand) in Apple retail and online stores, and both the companies are exploring future collaboration in digital health initiatives.
The joint statement also said that both the firms would conduct regular summits between top executives from both the firms to ensure that the relationship works effectively and to the benefit of both parties and their customers.
“This agreement will strengthen our collaboration,” said Basil Alwan, President of Nokia’s IP/Optical Networks business.
The value of the agreement will be reflected partially as patent licensing net sales in Nokia Technologies and partially as net sales in other Nokia business groups. The company said it will follow its existing practices for disclosing patent licensing revenue in its quarterly announcements and expects that revenues for the agreement will start to be recognized in the second quarter of 2017, including an element of non-recurring catch-up revenue.
Due to the up-front cash payment from Apple, Nokia intends to provide a comprehensive update of its capital structure optimization program in conjunction with its third quarter 2017 results.