Ericsson, the world’s biggest telecom network equipment maker, said it was suing Samsung Electronics Co for patent infringement after two years of talks failed to yield a license agreement.
Sweden’s Ericsson, which reckons more than 40 percent of the world’s mobile traffic passes through its networks, filed a lawsuit in the United States saying Samsung had refused to sign a license to use technology on terms it referred to as fair, reasonable and non-discriminatory (FRAND).
“Ericsson has tried long and hard to amicably come to an agreement with Samsung and sign a license agreement on FRAND terms. We have turned to litigation as a last resort,” Kasim Alfalahi, chief intellectual property officer at Ericsson said in a statement on Tuesday.
Alfalahi noted Ericsson has over 30,000 patents and more than 100 license agreements with major players in the industry.
A surge in smartphone and tablet computer sales has driven a switch in traffic on telecoms networks from mainly voice calls to video and music, which take up more capacity.
But although data traffic is surging – smartphone subscriptions alone are expected to rise to 3.3 billion by 2018 according to Ericsson’s own figures – operators are finding it hard to get customers to pay much extra, squeezing their profits.
With Ericsson suffering a big drop in sales at its network unit – down 17 percent in the third quarter – it is increasingly turning to the courts to maintain its patent income, part of a wider trend where big technology names are fiercely protecting their intellectual property as global sales of tablets and smartphones boom.
One lawsuit by Apple relating to patents resulted in a $1.05 billion jury verdict against Samsung, the world’s largest cell phone and television maker, in August.
An Ericsson spokesman declined to comment on the size of its lawsuit.
Samsung said it will “take all necessary legal measures to protect against Ericsson’s excessive claims.”
“Samsung has faithfully committed itself to conducting fair and reasonable negotiations with Ericsson over the past two years, but Ericsson has demanded prohibitively higher royalty rates to renew the same patent portfolio,” the South Korean company said.
Story first published: 27th November 2012