Apple and Taiwan-based mobile handset maker HTC on Saturday said that they had dismissed all current lawsuits and had entered into a 10-year license agreement covering current and future patents held by both parties.
Both Apple CEO Tim Cook and HTC CEO Peter Chou in statements said they are pleased to have resolved the dispute and look forward to focusing on innovation rather than litigation.
The companies did not disclose the terms of the license or the fees being paid, but a report in Forbes suggests HTC will pay $6 to $8 to Apple for every Android-equipped handset sold.
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A month after Apple sued HTC for patent infringement in March 2010, HTC signed a patent licensing agreement with Microsoft. The terms for that deal were also not disclosed, but reports have suggested HTC is paying Microsoft $5 per handset.
The fees Apple and Microsoft have demanded for their patents represent an attempt to raise the cost of using Google's free Android mobile operating system. Facing stacked royalties in the wake of its worst financial quarter since 2006, HTC might have reason to reconsider its commitment to Android. Coincidentally, HTC's U.S. website presently features a Windows Phone.
When Apple sued HTC two years ago, Steve Jobs, CEO of Apple at the time, said, "We can sit by and watch competitors steal our patented inventions, or we can do something about it. We've decided to do something about it. We think competition is healthy, but competitors should create their own original technology, not steal ours."
Jobs died just over a year ago, bequeathing to Apple an effort to destroy Android that he characterized as a thermonuclear war. Apple has had some successes in its campaign to defend its mobile market share against Android, most notably the patent infringement award of more than $1 billion imposed on Samsung over the summer. That verdict is presently being appealed.
But Job's handpicked successor, CEO Tim Cook, has expressed a disinclination for litigious conflict. During Apple's second-quarter 2012 conference call for investors, Cook said that he has "always hated litigation" and expressed a preference for settling, provided other companies don't view Apple's innovations as something they can just copy without consequence.