HTC and Apple end patent dispute with 10-year licensing deal

In a move that could signal a shift in the so-called smartphone patent wars, HTC and Apple have reached a settlement that shelves current legal disputes in favor of a 10-year licensing deal between the two companies. The exact details were not disclosed, but the agreement comes at a time when HTC desperately needs to stop bleeding money quarter after quarter and after Apple scored a $1 billion victory over Samsung this past summer.

Both parties issued similar statements from their chief executives, saying the settlement will allow the focus to remain on “innovation instead of litigation,” as HTC’s Peter Chou phrased it. The disagreement between the two goes back to 2010, when Apple sued HTC for allegedly infringing upon patents relating to the iPhone. Later, Apple was able to secure a ban on the import of certain HTC handsets based on the rulings of the International Trade Commission.

HTC’s shares saw a spike Monday morning after news of the settlement broke, though the licensing agreement is not expected to have a direct impact on the company’s short-term financials. Analysts also warn that HTC still has plenty of other challenges to overcome in order to turn around a trend that has seen the company become less and less profitable over time.

While the deal has given HTC a boost, it is the implication it could have for other current patent disputes pertaining to Apple that is perhaps most intriguing. Apple has long taken a stance that it would simply use its money and muscle to crush the competition both in and out of the courtroom. Coming to terms with HTC could mean Apple finally sees such legal wrangling as a waste of both time and money, with licensing deals and settlements a much better alternative for all involved. It will be interesting to see if Samsung, Motorola, and Apple all follow suit.

[via Reuters]

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  • DavidVarghese

    I’m happy for HTC… they make great products and with this licensing deal, they don’t have to worry about Crapple ruining their already great products…. I wonder what the details were

    • Jinwon Sung

      http://www.phonearena.com/news/HTC-will-have-to-pay-Apple-6-to-8-for-every-Android-handset-sold_id36517

      If this is true, not good for HTC and android overall at all. Apple is not stupid and they still have every intention to destroy android makers, squeezing out all the profit out of them, making them cost way more for developing android phones. HTC probably didn’t have any choice but to agree with it as they can’t afford to keep fighting in the court.

      • Johnny Garcia

        yeah i hear htc will pay up $6 to $8 for every phone they sell!!

  • Blkegk

    htc must have paid a lot to get apple of their back.

    • Blkegk

      off*

    • Jeffrey Evans

      I’m betting they share their LTE patents, the same ones they were going to sue Apple over. Apple will in turn use them as a defense against Samsung’s LTE lawsuit.

      We don’t know the fine details but it looks to me like Apple’s lawyers bullied HTC into a compromise that benefited both parties, but mostly Apple.

  • Albert Naranjo

    Good for you HTC. Learning from SamSUCK. You don’t want to be on the wrong end of a billion dollar lawsuit.

  • http://twitter.com/macavely Macavely

    So now HTC can start making phones with rounded corners??? And Apple can start working on a making something new..

  • blest

    About time

  • IronHorse01

    I see this happening with every other oem around except for Samsung, it’s pretty clear their war is with them

  • Robert Manser

    Finally Apple can be an innovative company and HTC can still be innovative without Crapple suing them.

  • bmg314

    Ok, Im guessing that htc is essentially saying that they need to focus their efforts on getting back into the game and can’t waste time and resources on litigation. But what about Apple? I would’ve thought anything but total destruction of their competition would be unacceptable…what are they playing at?

  • bos

    Seems like this is more about hurting Samsung and Android than anything else. With HTC’s plummeting sales, they are no threat to Apple. No reason for Apple not to cut a deal with them, especially since it might be useful as leverage in the Samsung lawsuits. HTC has just set a precedent that Android manufacturers owe Apple money.

    • Pnutt916

      How can you say that when we don’t know the terms of the deal? And to say that HTC is not still a threat is just plain false. HTC is first to market with a lot of Android’s innovative hardware. HTC had a bad year but they will bounce back in 2013.

      • http://www.swornbrotherhood.com/ nemesys06

        I really would like to see htc make a comeback next year but they don’t seem to go too much when it comes to innovation. I have used htc phones all the way from the hero to the evo lte and they all seem to me to be falling behind. Samsung has been adding features here and there, nothing major but in the end makes a difference. I feel the s3 and evo lte are very similar just different ui. The extra memory does help the s3. But the note 2 is where Samsung is really pushing the innovation. nothing comes close to that. I think htc and Motorola need to follow a trend set by Samsung and Apple though, craft one flagship phone and release it across all major carriers. I thought the htc one x was supposed to be that flagship but it was a joke. One phone, one set of specs, all carriers. No renaming, re branding or changing any specs (except carriers specific radios). Then maybe they can focus on catching Samsung

        • Pnutt916

          I totally agree in the one flag ship phone! That needs to happen immediately next year.

      • bos

        It is being widely reported that HTC will pay Apple between $6 and $8 per phone.

        If HTC has anything truly innovative in the pipeline it’s a well kept secret. A slightly larger version of the same phone that didn’t sell in 2012 isn’t going to save them. They lost their customer base when they decided to prioritize form over function. IMO LG has a shot at a big 2013, but HTC doesn’t.

        • vikings football

          why is htc paying apple 8.00 to 10.00 per device when apple declared it would not pay a penny over 1.00 per device for a license recently?

    • http://www.swornbrotherhood.com/ nemesys06

      you are right imo on one thing. Apple is more focused on Samsung than any other manufacturers. Sales is the only reason. Samsung is actually selling more phones than any other company and the Galaxy s3 is their leading flagship. banning Samsung products would be a major blow to the Android community. worrying about htc or other smaller companies I wouldn’t say is a waste, but it allows Apple to put more focus on Samsung.

  • milniko

    No sure that Apple finally sees such legal wrangling as a waste of both time and money, I think they must quit, because judge says “HTC Patents Challenged by Apple Probably Valid”:
    http://www.businessweek.com/news/2012-09-06/htc-patents-challenged-by-apple-probably-valid-judge-say

    • Pnutt916

      Looks like a mutual understanding to me!

      • milniko

        Here is why HTC doesn’t pay a cent to Apple
        First of all HTC had 2 threatening 4G patents in their portfolio which would have been valid for a lawsuit in the US. In a potential trial Apple would have significantly struggled to counter these patents, which would have ultimately led to an import ban of their 4G/LTE devices.

        Second, Apple couldn’t gain any significant wins against HTC outside of the US. In fact, it would have faced some serious trials in mainland China and we all know that those are the most unpredictable ones!

        Third (and this is another very important argument) they both hate Samsung. It’s like cats and dogs with Taiwanese and Koreans and you will still get to know consumers here, that would never ever buy a product from South Korea.
        Apple loses market share because of Samsung and HTC lost even more.
        https://plus.google.com/+SaschaPallenberg/posts/6DqWm3v2pQE

        • Pnutt916

          Makes sense!

          Sent from my EVO 4G LTE

  • Ahhk

    Apple can focus on innovating? LOL…..yeuh….

  • Joe Remo

    Apple is conceding total market share (Android OS vs iOS). but wants to grab the title/lead in market share per manufacturer. This settlement should definitely help HTC gain back some market share but Apple is hoping not as much as theirs. Apple is definitely falling apart and this settlement is another sign that’s leading lead to Apple’s irrelavance.

  • vikings football

    i think the fact that the deal is kept secret…has more to do that it favors apple more than it did htc..and thiis secret deal was impoosed by apple as part as the agreement.

  • ruit

    This can only help HTC get back on track the HTC one X was an awesome phone but had no marketing now that they don’t have to worry about apple suing them they can spend that money on ads and also apple needed htc ‘s lte patents also so I doubt it is 6 to 8 dollars probably like a 1 to 2 dollars for every phone sold.