EU has warned Nokia against becoming a patent troll
Joaquin Almunia, European Commissioner for Competition, has warned Nokia that it wouldn’t turn into a patent troll. This threat arose after the Finnish company sold most of its business to Microsoft. The most valuable remaining assets of Nokia are patents.
Joaquin Almunia authorized a deal between Nokia and Microsoft to sell a mobile business worth € 5.44 billion. He said the purchase “is not a threat to Microsoft,” but under the new conditions, Nokia may try to “extract higher profits” from its patent portfolio. “In other words, it can act like a patent troll or, to put it mildly, like a patent protection organization,” said Joaquin Almunia.
Nokia has a lot of patents in the field of mobile communications. Under the terms of the transaction, Microsoft received a 10-year license to use them. The threat is that Nokia may now refuse to honestly license patents to other mobile phone manufacturers, and instead will blackmail them using patents as a competitive advantage.
If this happens, the European Commission will initiate an antitrust case against Nokia, the European Commissioner for Competition warned. He promised that from now on he would closely monitor the Finnish company.
Several mobile phone manufacturers have used their patents in recent years to put pressure on competitors, including Samsung and Motorola, so Nokia has role models. The company has already stepped on a dubious track, having achieved a ban on sales in the UK of HTC One Mini smartphones, since HTC violates Nokia patents . Now, a Taiwanese company must pay compensation to Nokia.
Nokia is currently earning approximately € 500 million a year in licensing fees. After the transaction with Microsoft, this amount will increase to 1.65 billion euros per year.