Patent fears grow in China over Microsoft/Nokia tie-up – report

04 MAR 2014
Flag of the People's Republic of China

Google and Samsung, according to government-level Bloomberg sources, have expressed concern that a combination of Microsoft and Nokia’s mobile-phone business might mean higher patent licensing fees in China.

The search engine giant, along with the South Korean manufacturer, have apparently asked China’s Ministry of Commerce to ensure Microsoft’s acquisition of Nokia’s Devices and Services unit doesn’t result in higher fees from wireless patents that remain with the Finnish company.

Another concern is that Microsoft, by gaining more power in the smartphone market, might abuse its patents.

Huawei and ZTE, according to Bloomberg sources, have already asked China’s regulators to set conditions on the deal.

Government officials talking to Bloomberg said China’s Ministry of Commerce is conducting an anti-monopoly review and will likely approve the deal. Whether or not restrictions will be imposed on raising patent fees is still to be determined.

A review of Microsoft’s purchase of Nokia’s phone business comes against a backdrop of increased pressure on western tech companies in China.

Qualcomm is facing increased pressure in China after the country’s Communications Industry Association (CCIA) recently filed a complaint against the US chipmaker for abusing what it alleges is a dominant market position.

InterDigital, another US wireless firm, announced on 7 February it was continuing to cooperate with an anti-monopoly law investigation by NDRC (National Development and Reform Commission).

  • VH

    This is ludicrous and shameful…the only monopolies that exist are the ones run by Google and Samsung (android) founded on theft of nokia’s IP. Nokia (soon to be msft) smartphone share in china is what 2%? This is like thieves asking the court to prevent homeowners from using locks on their doors…ridiculous and pitiful. Nokia will be out of the phone business altogether, so how is that in anyway anti-trust?
    Google and Samsung and the Chinese OEMs are very obviously trying to restrain trade by possibly trying to corrupt the Chinese regulators. They are the ones that needs to be investigated as Android is over 75% of the market worldwide now…that is the real monopoly that needs to be broken up, not nokia/msft’s pitiful window phone ecosystem that’s barely at 2% in china and in the single digit % everywhere else in the world.

  • VH

    As Nokia is the divesting firm; and the Chinese review is supposed to be an anti-trust anti-monopoly review, it would be highly unusual to place any burden on Nokia. The Chinese may attempt to impose more burden on Msft as the enlarging entity…but with windows phone at 3% of the Chinese market, Msft is far from having a dominant market share pursuant to even Mofcom’s own definition of what constitutes ‘dominant’ market share.

    China’s Mofcom’s mandate does not extend to patents. Not all monopolies are illegal, patents and IP being case in point..they are legal monopolies granted for a limited duration to encourage innovation, something the Chinese has recently said they wish to encourage thru stronger IP enforcement. China has its own patent office and IP courts with appropriate jurisdiction that are better equipped to deal with any future patent issues that may arise. Here the issue is moot as Nokia has largely supported FRAND pricing for its standard essential patents and it has been widely acknowledged to be one of the weaker IP enforcers to date.

    Moreover, you cannot preemptively limit a company’s property rights for something they have not yet in fact done. If mofcom does in fact impose patent limitations on Nokia, then the WTO, US and EU needs to seriously examine any such decision for restraint of trade and protectionism by the Chinese in the guise of anti-trust regulation; and take appropriate retaliatory trade sanctions. 15 Countries have already approved this deal without restrictions…for the simple reason that there are NO anti-trust issues existent. It is the height of hypocrisy to use regulatory approval as disguise for domestic trade protectionism, especially in this case where a company is divesting and in fact exiting altogether from an industry.


Ken Wieland

Ken has been part of the MWC Mobile World Daily editorial team for the last three years, and is now contributing regularly to Mobile World Live. He has been a telecoms journalist for over 15 years, which includes eight...More

Read more