Apple and HTC End Patent Battle

By: Tim Bradshaw and Sarah Mishkin, CNN Email
By: Tim Bradshaw and Sarah Mishkin, CNN Email

Apple has settled its first patent battle over smartphone makers using Google's Android platform, agreeing a 10-year licensing deal with HTC, the struggling Taiwanese manufacturer.

On Sunday morning in Taiwan, HTC and Apple announced a "global settlement that includes the dismissal of all current lawsuits".

Terms of the deal, which included current and future patents held by both companies, were not disclosed, but mean that both companies are spared the threat of products being barred from sale as disputes work through the courts.

Industry analysts say the move will allow Apple to concentrate its legal and competitive efforts against Samsung, which it accuses of infringing many aspects of the iPhone's designs in a range of cases around the world.

Tim Cook, Apple's chief executive, said: "We are glad to have reached a settlement with HTC. We will continue to stay laser-focused on product innovation."

Apple has previously struck patent licensing agreements with Nokia and Microsoft but remains engaged in a variety of suits around the world against Samsung, Google's Motorola unit, and others.

As HTC loses market share in the Android market to Samsung, the Taiwanese group has been developing more devices using Microsoft's Windows Phone software.

"HTC is pleased to have resolved its dispute with Apple, so [we] can focus on innovation instead of litigation," said Peter Chou, chief executive of HTC.

Apple accused HTC smartphones of infringing its patents around the type of scrolling known as "rubberbanding" and data detection -- for instance, making addresses in emails into clickable links. HTC alleged that Apple's latest iPads and iPhones violated its intellectual property around 4G or LTE high-speed wireless connections.

The licensing agreement may also mean both companies have access to patented technologies, in wireless transmission or user-interface design, that rivals such as Samsung do not, giving their future products a potential advantage in the competitive and fast-moving smartphone market.

HTC said its licensing payments to Apple would have "no material impact on the finances of the company".

HTC, whose speedy rise from relatively unknown contract manufacturing to leading Android phonemaker is now being matched, some analysts fear, by an equally speedy fall back to the status of minor player.

Although the company's phones are generally well-reviewed, analysts say its marketing efforts and ability to promote its phone through retail channels fall far short of its two larger competitors.

HTC has previously lost cases in the US against Apple at the International Trade Commission.

The settlement follows Apple's victory against Samsung in the US courts over smartphone designs, in which a jury awarded more than $1bn to Apple in damages.

Mr Cook this year bemoaned the extensive litigation in the technology industry over so-called standards essential patents. "It's maddening," he said. "I wish we could settle this stuff."

But Mr Cook has also maintained that he would continue to defend Apple's innovations through the courts.

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