Patents and Share Prices - Ericsson

Apple and Ericsson have been engaged in a number of patent infringement suits over the past few years. Finally, on Monday Ericsson announced that it had reached a settlement with Apple under which Apple would be granted to all of Ericsson's standard-essential patents, as well as to certain other patent rights (which are not named). We've often reported on these patents on this blog and my fellow contributor Keith Mallinson has studied them extensively and their effect on competition.

The Apple settlement will apparently boost Ericsson's revenue from licensing of intellectual property rights in 2015 to SEK 13-14 b (around USD 1.5 billion) compared to 2014's revenue of SEK 9.9 bn reported here. It's not surprising that Ericsson's share price jumped yesterday from Friday's closing price of USD 9.12 to USD 9.62 at 09.50 Eastern time after announcement and closed today (Tuesday) at USD 9.56. Apple's price did not change much during the same period.

It's clear that licensing revenue is becoming a significant contributor to Ericsson's bottom line. In 2014 operating income was reported to be SEK 11.1 Bn, which included a payment from Samsung for an IPR licence of SEK 2.1 Bn.  The amount paid by Apple remains confidential and will include an ongoing royalty (as does the Samsung agreement) and so there will be further contributions to Ericsson's bottom line over the next few years.

The European Commission, among other organisations, have been concerned that the smartphone patent wars damage competition, as reported in the Financial Times. The Apple/Ericsson agreement show how patent can work - Ericsson receive additional revenue for their work on the development of telecommunication standards and Apple pay for access to this technology.

"finance & Insurance" Apple Ericsson Smartphone standard essential patents

That's our discussion regarding Patents and Share Prices - Ericsson

that's all organic foot formula Patents and Share Prices - Ericsson, I hope this article was useful for you.

You 're reading an article Patents and Share Prices - Ericsson and this article permalink is http://auto-insurance-finance.blogspot.com/2016/09/patents-and-share-prices-ericsson.html I hope this article about was useful for you.

Related Posts