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Bonfire photo by Janne Karaste, via Wikimedia Commons

Nokia and RIM: The bonfire of the vanities

Posted By TelecomTV One , 29 November 2012 | 0 Comments | (0)
Tags: Nokia RimWLAN r technology patents money

Like squabbling clones of the Roman Emperor Nero, Nokia and RIM fiddle about whilst the markets they used to dominate burn around them. Meanwhile, Apple and Samsung are laughing all the way to the bank. By Martyn Warwick.

Yes, it's yet another rib-tickling round of that most entertaining of parlour games, Patent Absurdity. This time Nokia wants the sale of Research in Motion's once all-conquering BlackBerry devices banned in the whole of the US, Canada and the UK, unless, that is, the bedraggled RIM coughs up huge sums in licensing fees that will allow it to manufacture and sell mobile devices featuring a particular wi-fi connectivity technology - WLAN. RIM's already battered share price fell by 10.8 per cent as the news hit the markets.

RIM is betting the farm on its much-vaunted and long delayed new operating system - the, by now, close to mythical BlackBerry 10. The company needs a war with Nokia about as much as it as it needs a touch of the bubonic plague. According to the latest set of figures, RIM's global market share in Q3 was down to just 4.3 per cent. How are the mighty fallen.

That said, it is difficult to have any sympathy for either side in this latest farrago. Nokia is a shadow of its former self and, despite apparently excellent sales of the Lumia 920 smartphone in some markets, it will never again be the power that it once was.

However, the Finnish company does own a lot of patents, (as indeed does RIM) but in this particular instance RIM is the author of its own fate. It was RIM that decided to take its patent argument with Nokia to arbitration, by, of all things, the Stockholm Chamber of Commerce (!).

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That august body duly found in favour of Nokia, opining, much to RIM's chagrin, that the Canadian company "is not entitled to manufacture or sell products compatible with the WLAN standard" until and unless it agrees a royalties regime with Nokia.

RIM has not done so and now, a couple of months on, Nokia has filed court actions in North America and the UK to have extant BlackBerry models withdrawn from sale.

The origins of this bit of bother go back close to ten years. Back in 2003, RIM agreed a cross-licensing agreement with Nokia for what are referred to as "standards-essential cellular patents". I don't know about you, but I'm not at all sure what "standards-essential cellular patents" are or what the phrase actually means but the brainy bods at the Stockholm Chamber of Commerce seem to understand it, so that's alright then.

The 2003 agreement between the two parties was tweaked in 2008 and then, last year, RIM, claiming that the agreement "extended beyond cellular essentials" demanded that it be taken to arbitration. It was and, as we know, the arbitrator found against RIM. However, having come off worst, RIM ignored the ruling and blithely continued to operate as though the arbitration hadn't taken place at all. In other words, it's fingers in its ears, its head in the sand and whistled "Dixie" - and that's really quite a tricky thing to do.

As is par for the course in these cases Nokia has filed for legal enforcement of a Swedish arbitration body's ruling on an argument between a Canadian company and a Finnish company in, hazard a guess?, yup, spot on, California in the US. Why? Well, according to Nokia it is because the New York Convention of 1958 which governs instances of international arbitration, was signed by the US as well as Finland, Canada and Sweden. There couldn't be anything more to it than that, could there?

 

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