Nokia 2011 Annual Report Download - page 61

We also source software, applications and content from a global network of third-party companies,
application developers, content providers and industry-leading technology providers. For instance, we
obtain content from commercial partners in the music industry to offer an extensive catalog of digital
music through Nokia Music, our digital music store, and content from travel guide publishers to expand
and enhance Nokia Maps.
Patents and Licenses
A high level of investment by Devices & Services in research and development and rapid technological
development has meant that the role of intellectual property rights, or IPR, in our industry has always
been important. Digital convergence, multiradio solutions, alternative radio technologies, and differing
business models combined with large volumes are further increasing the complexity and importance of
IPR.
The convergence has for a long time meant that complete products integrate a number of
technologies, and that multiple parties contribute to the development of new technologies. The detailed
designs of our products are based primarily on our own research and development work and design
efforts, and generally comply with all relevant and applicable public standards. We seek to safeguard
our investments in technology through adequate intellectual property protection, including patents,
design registrations, trade secrets, trademark registrations and copyrights. In addition to safeguarding
our technology advantage, they protect the unique Nokia features, look and feel, and brand.
We have built our IPR portfolio since the early 1990s, investing over EUR 45 billion cumulatively in
research and development, and we now own over 10 000 patent families. As a leading innovator in
wireless technologies, we have built what we believe to be the strongest and broadest patent portfolios
in the industry, extending across all major cellular and mobile communications standards, software and
services as well as hardware and user interface features and functionalities. We receive royalties from
certain handset and other vendors under our standard essential patent portfolio. Royalty income is
reported under Devices & Services Other.
We are a world leader in the development of the wireless technologies of GSM/EDGE, 3G/WCDMA,
HSPA, LTE, OFDM, WiMAX and TD-SCDMA, and we have a robust patent portfolio in all of those
technology areas, as well as for CDMA2000. We believe our standards-essential patent portfolio is one
of the strongest in the industry.
Our products include increasingly complex technology involving numerous patented, standardized or
proprietary technologies. The possibility of alleged infringement and related intellectual property claims
against us continues to rise as the number of entrants in the market grows, our product range becomes
more diversified, our products are increasingly used together with hardware, software or service
components that have been developed by third parties, we enter new businesses, and the complexity
of technology increases. As new features are added to our products, we are also agreeing upon
licensing terms with a number of new companies in the field of new evolving technologies. We believe
companies like Nokia with a strong IPR position, cumulative know-how and IPR expertise can have a
competitive advantage in the converging industry and in the increasingly competitive marketplace.
Location & Commerce relies primarily on a combination of copyright laws, including, in Europe,
database protection laws, trade secrets and patents to establish and protect its intellectual property
rights in its database. Location & Commerce protects its database, software and related technology
through patents as well as through the terms of license agreements and by confidentiality agreements
with its employees, consultants, customers and others.
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