An agreement between Nokia and Apple to settle all patent litigation between the companies may mark the beginning of a more aggressive shift into intellectual property rights (IPR) for Nokia.
The struggling mobile phone maker brought its chief legal officer into its main management team as part of a recent reshuffling and CEO Stephen Elop has stated that Nokia will do more in terms of monetizing its IPR.
Nokia alone, or in some cases along with Microsoft, could push harder to secure licensing and royalty income from new entrants in the smartphone market, according to Rod Hall, an analyst at J.P.Morgan.
“The patent license agreement with Apple highlights the strength and breadth of Nokia’s patent portfolio in the wireless communications market,” he said in a research note.
Existing players infringing on patents could also be targeted since Nokia has a very broad portfolio in the mobile market, Mr. Hall told clients. He added that newer entrants won’t be able to fight back with IPR of their own.
So while the one-time licensing payment and on-going royalties Apple will pay Nokia for the term of the agreement will have a positive financial impact in the second quarter of 2011 and beyond, the analyst said Nokia’s market share and execution challenges as it transitions to Windows Phone OS remain very high in the near term.
J.P.Morgan’s rating on Nokia remains at Underweight with a €4.30 price target.(
The struggling mobile phone maker brought its chief legal officer into its main management team as part of a recent reshuffling and CEO Stephen Elop has stated that Nokia will do more in terms of monetizing its IPR.
Nokia alone, or in some cases along with Microsoft, could push harder to secure licensing and royalty income from new entrants in the smartphone market, according to Rod Hall, an analyst at J.P.Morgan.
“The patent license agreement with Apple highlights the strength and breadth of Nokia’s patent portfolio in the wireless communications market,” he said in a research note.
Existing players infringing on patents could also be targeted since Nokia has a very broad portfolio in the mobile market, Mr. Hall told clients. He added that newer entrants won’t be able to fight back with IPR of their own.
So while the one-time licensing payment and on-going royalties Apple will pay Nokia for the term of the agreement will have a positive financial impact in the second quarter of 2011 and beyond, the analyst said Nokia’s market share and execution challenges as it transitions to Windows Phone OS remain very high in the near term.
J.P.Morgan’s rating on Nokia remains at Underweight with a €4.30 price target.(
