Optical/IP Networks

Nokia Fires Volley at Apple's iPhone

Nokia Corp. (NYSE: NOK) is throwing the book at Apple Inc. (Nasdaq: AAPL), alleging that the über-popular iPhone infringes on a total of 10 patents tied to the GSM, UMTS, and wireless LAN (WLAN) standards. (See Nokia Throws Book at the iPhone.)

The patents cited in the suit cover wireless data, speech coding, security, and encryption. Nokia alleges that all existing Apple iPhones models, first introduced in 2007, infringe on all of them.

Apple shipped 7.4 million iPhones in its fiscal fourth quarter, a 7 percent year-on-year increase, making the handheld wonder a continuous hit for its lone U.S. carrier partner, AT&T Inc. (NYSE: T). But Nokia says it's gotten nothing in the way of compensation from Apple despite efforts to get Steve Jobs & Co. to pay up. (See Apple Reports Q4.)

"By refusing to agree appropriate terms for Nokia's intellectual property, Apple is attempting to get a free ride on the back of Nokia's innovation," Nokia VP of legal and intellectual property Ilkka Rahnasto said in a statement.

The legal volley comes as Apple continues to take a bite out of Nokia's world-leading market share. Apple's piece of the smartphone pie reportedly jumped to 13.4 percent in the second quarter, versus just a 3 percent piece a year ago. According to Gartner Inc. data, Nokia had 45 percent of the smartphone market by the end of the second quarter, down 2 percent year-on-year.

Nokia filed the suit in Delaware District Court, but did not specify any financial penalties it's seeking. Nokia claims it's spent more than €40 billion (US$60 billion) fleshing it out during the past two decades.

Nokia and Apple were not immediately available for comment on the lawsuit.

Apple shares were down $1.74 (0.85%) to $203.18 each in afternoon trading Thursday. Nokia was up 17 cents (1.31%), to $13.17 each.

— Jeff Baumgartner, Site Editor, Cable Digital News

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