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Just how valuable are Nortel's LTE patents?

Nortel has approximately 5,500 LTE patents that it could use to generate royalties and/or create and develop new 4G applications.

While Sony Ericsson has entered into an agreement to pay Nortel a fee to license and use the intellectual property rights (IPR) to the pre-4G LTE patents encompassed within their deal, Nortel has decided against selling the patents to Ericsson, for now. Nortel has yet to announce what the company will do with some 5,500 long-term evolution patents, but clearly the LTE patents are the company’s most valuable asset.

Just how valuable is up for debate. In April, Alcatel-Lucent, Ericsson, NEC, NextWave Wireless, Nokia, Nokia Siemens Networks and Sony Ericsson entered into a mutual commitment to a framework that will secure fair and non-discriminatory licensing for LTE technology. The companies agreed to a single-digit percentage royalty on equipment using LTE.

In a move to fortify confidence in the licensing framework, Nortel committed to a competitive royalty rate (1%) for its standards-essential patent claims for LTE handsets – a move the company hopes will boost confidence and speed up global adoption of LTE by service providers, according to Greg Galitzine.

Find out more about LTE technology and Nortel’s stake in the progress of 4G applications.

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