The big news out of wireless technology firm Qualcomm
The settlement includes several agreements between the two companies, most prominently a new, 15-year patent license agreement. This license will have Nokia pay Qualcomm an up-front fee, as well as ongoing royalties through 2022, across a broad range of current and future technologies. Qualcomm and its investors were pleased with the deal, and shares soared nearly 20% this morning, adding almost $15 billion to the company's capitalization.
Coincidentally, the agreement came on the very day that Qualcomm and Nokia were due to walk into court in Delaware. The court announced a delay in the hearing, creating an eerie similarity to 1999. Back then, a court hearing in Marshall, Texas with Ericsson
This major milestone also has Nokia assigning certain patents to Qualcomm, and it paves the way for the two companies to collaborate in a number of areas, rather than paying millions to spar in courts around the world. It also gives Qualcomm the rights to incorporate Nokia technology into its chipsets. The alignment of a major supplier and technology partner should ease concerns from major carriers AT&T
While the dispute with Nokia is separate from Qualcomm's legal wrangling with Broadcom
While Qualcomm did estimate that the agreement will add $0.07 to $0.13 per share to fiscal 2008 earnings, it noted that it has yet to fully hammer out the financial impact of the settlement. More importantly, though, the agreement positions Qualcomm well for the next major standards battleground -- the wireless Internet battle between LTE and WiMAX.
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