Apple is dropping its lawsuit against Nokia. The iPhone manufacturer and the Finnish company reached an agreement to not only bring the intellectual property dispute to an end, but also to start a multi-year patent license.
Described as a "meaningful agreement", details of the new arrangement are confidential, at least for the time being, but Apple does shed a little light on what's going to be happening moving forward. Apple will receive network infrastructure product and services from Nokia, and the company will also resume carrying the Withings health products Nokia bought.
Nokia says that the arrangement means that the two companies are now business partners rather than adversaries. Apple's COO Jeff Williams says that the company is "pleased with this resolution of our dispute", with Basil Alwan, President of Nokia's IP/Optical Networks business, adding: "We look forward to supporting Apple."
In a statement, Apple says:
Under a business collaboration agreement, Nokia will be providing certain network infrastructure product and services to Apple. Apple will resume carrying Nokia digital health products (formerly under the Withings brand) in Apple retail and online stores, and Apple and Nokia are exploring future collaboration in digital health initiatives. Regular summits between top Nokia and Apple executives will ensure that the relationship works effectively and to the benefit of both parties and their customers.
The statement goes on to give a little more information about what the new agreement means:
Nokia will receive an up-front cash payment from Apple, with additional revenues during the term of the agreement.
The value of the agreement will be reflected partially as patent licensing net sales in Nokia Technologies and partially as net sales in other Nokia business groups. Nokia will follow its existing practices for disclosing patent licensing revenue in its quarterly announcements and expects that revenues for the agreement will start to be recognized in the second quarter of 2017, including an element of non-recurring catch-up revenue.
Due to the up-front cash payment from Apple, Nokia intends to provide a comprehensive update of its capital structure optimization program in conjunction with its third quarter 2017 results.