Ericsson, the former phone maker and long-time Sony partner, owns a number of patents that are crucial to the function of modern smartphones, primarily involving the use of 2G GSM and 4G LTE mobile networks. While the Swedish company has agreements with other manufacturers, the contract with Apple ended at the beginning of 2015 after talks to renew the license broke down.
Apple has now agreed to pay royalties on the wireless devices it sells to Ericsson, according to Reuters. The global cross-license patent agreement ends all current patent-infringement suits between the two companies. As per the settlement, Apple will pay an undisclosed lump sum to Ericsson, and then will pay ongoing royalties for seven years — the length of the deal.
While details on the settlement are sparse, Ericsson has predicted that revenue from its intellectual property rights will range from 13 to 14 billion Swedish krona, which comes out to around $1.64 billion. Of course, the Apple royalties will account only for a portion of this amount.
Early in the year, Ericsson filed seven lawsuits in the U.S. against Apple, and made requests to the International Trade Commission for the iPhone to be blocked from sale. Ericsson claimed that 41 patents were being infringed by Apple, and said the lawsuits arose because Apple rejected an offer of a license. Apple said at the time that Ericsson was using “abusive patent licensing practices.”
Ericsson has shifted from making phones to the infrastructure side of mobile communications, and has become pretty aggressive in managing its patent licenses. In previous years, the company has filed cases against Samsung and Xiaomi.