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Ericsson and Apple end litigation by signing patent deal

Ericsson has put an end to a year long dispute with Apple by signing a patent license deal on Monday. This deal has sent the company's shares up 7 per cent.

Although Ericsson did not reveal how much the company would earn from the deal, its estimated total revenue from intellectual property rights is set to increase by 9.9 billion Swedish crowns from what it made last year in 2014. It is estimated that Ericsson will charge Apple around 0.5 per cent for the revenue it makes on iPads and iPhones.

According to Kasim Alfalahi, the Chief Intellectual Property Officer at Ericsson, the nature of the agreement between the two companies was broad and will cover the latest 4G-LTE mobile technology along with the previous 2G and 3G technology developed by the company. Ericsson and Apple will continue to work together in a variety of areas including the development of a 5G radio network and with the optimisation of the network.

The dispute between the two companies began in January when Ericsson filed a complaint against Apple in regard to mobile technology license payments. The complaint was a response to a lawsuit which was filed by Apple during that month.

It has been estimated by analysts that Apple will have to pay Ericsson between 2 to 6 billion Swedish crowns annually based on royalty payments and handset sales.

Image Credit: Shutterstock / 360b

Anthony Spadafora
After living and working in South Korea for seven years, Anthony now resides in Houston, Texas where he writes about a variety of technology topics for ITProPortal.