Following Patent Deal, Every Time Apple Sells An iPhone, Ericsson Gets A Bit Of Money

Telecommunications infrastructure company Ericsson just announced that it has reached an agreement with Apple over an ongoing patent dispute. For the next seven years, Apple will pay a fraction of its iPhone and iPad profit to Ericsson in royalties.

Back in February, Ericsson filed suits in many different jurisdictions for patent infringement (the International Trade Commission, the U.S. District Court for the Eastern District of Texas, the U.S. District Court for the Northern District of California, as well as courts in the U.K., Germany and the Netherlands). According to the Swedish company, Apple has been violating 41 patents over the past few years with its iPhone and iPad, in particular patents related to GSM, UMTS and LTE technologies.

As expected, the two companies have reached an agreement and Ericsson is dropping all of its lawsuits. Today’s news isn’t particularly surprising as Ericsson holds more than 35,000 patents. Many of them are related to wireless technologies, and many phone manufacturers have licensing agreements in place with Ericsson. But it looks like Apple didn’t want to agree to these terms.

Apple is going to make a lump-sum payment to Ericsson for 2015 and pay royalties in the future. It’s unclear how much money Ericsson is going to make with this new deal. But given Apple’s dominant position in the mobile industry, it could be a significant sum.

Ericsson’s licensing revenue for 2015 will amount to $1.5 to $1.6 billion (13 to 14 billion SEK). According to Reuters, this number is up from $1.2 billion last year (9.9 billion SEK).

Finally, the two companies are staying in good terms as they are going to collaborate on 5G technologies, video networks traffic management and network optimization — keep your friends close and your enemies closer.

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