Talk of the Day -- HTC-Apple patent battle comes to happy ending

A long patent batle between Taiwan's leading smartphone maker HTC and U.S. technology giant Apple Inc. has finally come to an end, with the two companies announcing a global settlement and licensing agreement Sunday. Media reports said it marks the first time that Apple has agreed to settle a patent dispute with a smartphone maker that uses the Android operating system developed by another U.S. technology behemoth Google Inc. Apple's late co-founder Steve Jobs once said he was "prepared to go to thermonuclear war" to "destroy" the Android platform. Local industry analysts said the settlement symbolizes to some extent Apple's recognition of HTC's innovative efforts in smartphone technology. While details of the two companies' 10-year licensing agreement have not been disclosed, analysts said they believe HTC's strength in long-term evolution (LTE) 4G technology is mainly what prompted Apple to end its nearly three-year-old litigation battle with the Taiwanese smartphone maker. The following are excerpts from a special report in the Sunday edition of the United Evening News on the settlement of HTC-Apple patent disputes: HTC has grown as the first maker of phones running on the Android platform, but its sales have been slumping since the second half of 2011 amid growing competition. The company has since been struggling to compete in a market increasingly dominated by Apple and South Korean technology titan Samsung Electronics Co. HTC has endured many challenges this year. In April, its products were blocked by U.S. customs authorities for inspection. It twice lowered its sales forecast in June, posted far lower-than-expected profits in Q3 and saw its stock price fall to a 7.5-year low earlier this month. The settlement of the lengthy patent battle with Apple is expected to give HTC a badly needed shot in the arm to score a comeback in the highly competitive smartphone market, analysts said. HTC and Apple had been locked in a patent battle since March 2010, with Apple accusing HTC of infringing on its patents around "rubber banding" and data detection, and HTC accusing Apple of violating its intellectual property around 4G LTE high-speed wireless connections. The two companies announced Sunday in Taiwan that they have agreed to end their global patent disputes through the dismissal of all pending lawsuits and a 10-year licensing agreement. "HTC is pleased to have resolved its dispute with Apple, so HTC can focus on innovation instead of litigation," HTC CEO Peter Chou said in the joint statement. For his part, Apple CEO Tim Cook said, "We are glad to have reached a settlement with HTC. We will continue to stay laser focused on product innovation." The terms of the deal were not disclosed, but analysts said the licensing agreement that covers current and future patents held by both firms would give HTC and Apple access to patented technologies in wireless transmission and user-interface design. Under the licensing agreement, HTC is expected to focus its energy on developing more innovative software that would give users access to better, easier and more useful and convenient wireless applications, industry analysts said. Facing market headwinds, HTC gave a conservative guidance for its Q4 sales last week, forecasting its Q4 revenues at about NT$60 billion, a new low since the second quarter of 2010. Market analysts said whether HTC would bounce back following the singing of the patent deal with Apple will hinge on its ability to launch amazingly impressive products in the first quarter of next year. Decreases in HTC sales have had a significant impact on Taiwan's export records, according to government statistics. In the first 10 months, Taiwan's exports shrank US$9.5 billion from the year-earlier level, of which US$4.2 billion or nearly 50 percent resulted from drops in smartphone exports, according to data released by the Ministry of Finance. Taiwan's overall exports to the U.S. for the 10-month period slid 10 percent year-on-year, but if smartphone was excluded, Taiwan's shipments to the U.S. for the period posted a 3 percent growth, MOF data showed. (Nov. 11, 2012). (By Sofia Wu)