Apple's Reply to Nokia

I felt like an archaeologist trying to formulate a theory of what had happened there. I loved the feeling of trying to put together the story from a partial puzzle.

The patent infringement lawsuit against Apple was a list of accusations and patent lists that Nokia claims that Apple infringes with their iPhone. But behind the background information provided in the legal document and the list of ways in which Nokia felt Apple had wronged them, it was difficult to put together a narrative. Scanning the discussion forums for clues did not lead to anything significant beyond the superficial analysis.

As a software developer, and in particular a Linux software developer, I have mixed feelings about this lawsuit. Apple has not been exactly a model citizen when it comes to interoperability between Apple and Linux products while Nokia has embraced Linux, embraced open source development and contributed to the universal pool of software. But I also found myself enjoying using my iPhone and building software for the iPhone.

I wanted to give both companies the benefit of the doubt. What had happened between these two companies that had forced Nokia to sue Apple?

There were various possibilities.

The lack of immediate response from Apple suggested that they were caught unprepared, but that was just a small chance. Probably the companies had been on negotiations and these negotiations broke off when they could not reach an agreement. The iPhone had taken the world by surprise, nobody had seen it coming and nobody had envisioned that Apple would not merely do an incrementally better phone, but it would be many times better than anything available at the time.

When Apple launched the iPhone, Steve Jobs wanted everyone to know that iPhone's innovations were patented and that Apple planned to prevent others from copying those ideas.

Apple's response to Nokia is a very educational document. It reads as a crash course on patent litigation when it lays out Apple's strategy for their defense. It is also a crash course on the patent system and how corporation work with international bodies to develop technology. But most importantly for me, it fills some the gaps of what happened behind the scenes.

We do not know yet which company approached the other first about patent infringement. It could have been someone on Nokia's board that decided to extract some revenue from their patents to compensate for their business losses or it could have been initiated by Apple's team notifying Nokia that their new phones used some idea from their phones.

What does emerge from Apple's reply is that Nokia tried to use the patents that they had pledged to license under reasonable terms to get themselves rights to Apple's juicier iPhone innovations. Nokia's pledged patents might be formidable patents and key to the implementation of certain cellular and WiFi communications, but by being pledged under F/RAND terms to various industry consortia they lost a significant amount of value. But what they lost in value, they made up in volume. This is in stark contrast with Apple's un-pledged, pristine, fully proprietary patents that Nokia and everyone but China are trying to get rights to.

Posted on 12 Dec 2009 by Miguel de Icaza
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