Samsung and Ericsson finally ended their lengthy dispute over global patent licenses. The results of the agreement landed Ericsson with $650 million in addition to royalties. The signing of the cross-licensing deal covers a wide range including GSM, UMTS and LTE standards for both networks and handsets.
The origins of the disagreement date back to 2012 when Ericsson claimed Samsung was seeking to significantly reduce what it pays to license patents that are essential to meeting global standards. On the flipside, Samsung felt the royalty rates Ericsson was seeking for the same patents were extreme and considerably higher than the prior royalty rate from the previous license.
“During the litigation we continued our conversations with each other because we wanted to find an amicable solution,” said Kasim Alfalahi, Ericsson’s chief intellectual property officer.
Ericsson is the world’s largest network equipment vendor while Samsung is the world’s largest handset maker. Although these powerhouse companies have been butting heads, the feelings from both sides are that they are happy to put this issue behind them. Clearly it’s better to have negotiations rather than litigations.
With deals struck, it appears that both companies are in a much better place. Ericsson currently has a patent portfolio of more than 30,000 patents while Samsung has now reached agreements with Ericsson and Google.