Published October 24, 2009

Nokia hurls a rock at iPhone, no ripples here

It accuses Apple of stealing its innovations

By ONG BOON KIAT

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A POTENTIALLY market-shaking legal fight has broken out between Nokia and Apple, but the feverish demand here for Apple's iPhone is unlikely to be doused by the news. Nokia, the world's biggest mobile-phone maker, on Thursday sued Apple for alleged infringement of 10 patents, which cover wireless data, speech coding, security and encryption.

In its complaint filed with a US federal court in Delaware, Nokia said it was seeking compensation for Apple's use of the patents, as well as a declaration that Nokia is entitled to an injunction until Apple pays compensation, along with interest, for past infringement. It has accused Apple of seeking 'a free ride on the back of Nokia's innovation'.

Both firms have reportedly been locked in long-running talks to agree on a deal for Apple to pay a licence fee to use technologies developed by Nokia that are already used in the iPhone.

The threat of a clash in court between the two handset titans and a possible injunction on Apple should not have an immediate impact on iPhone sales in Singapore.

'Consumers would be pretty much oblivious to these legal spats,' said Aloysius Choong, a research manager with technology analyst firm IDC Asia-Pacific. For one thing, the typically long-drawn nature of such patent lawsuits means consumers aren't likely to worry at this early stage about the future viability of the iPhone, he noted. Moreover, 'the iPhone is a profitable product, so it wouldn't be in Apple's interest to let it go to the extent of having an injunction on them'.

'The other thing to note is when it comes to announcements like this, typically the companies have been involved in negotiations for a while. So the fact that Nokia has announced it is suing Apple for these patent issues doesn't mean that both parties will stop negotiating,' he added.

Singapore Telecommunications, which until recently held the exclusive rights to sell the iPhone in Singapore, declined to comment when asked about the possible impact on iPhone sales that the lawsuit might bring. MobileOne, which will be selling iPhones in the next two months, also declined to comment. The iPhone has been a runaway hit in Singapore since its debut last year, with one estimate putting sales of the previous-generation 3G iPhone models at over 60,000 units. According to SingTel, 'tens of thousands' had signed up for the current iPhone 3GS before it started selling in July.

In their previous fiscal quarters, Apple shipped 7.4 million iPhones while Nokia delivered 5.7 million touch-screen devices and 108.5 million phones in total. Last week, Nokia said its share of the global smart phone market fell to 35 per cent in the third quarter from 41 per cent in the second, as Apple and Research In Motion gained.