Ericsson sues Samsung for patent infringement

By Anna Ringstrom

STOCKHOLM (Reuters) - Ericsson, the world's biggest telecom network equipment maker, said it was suing Samsung Electronics Co for patent infringement after two years of talks failed to yield a license agreement.

Sweden's Ericsson, which reckons more than 40 percent of the world's mobile traffic passes through its networks, filed a lawsuit in the United States saying Samsung had refused to sign a license to use technology on terms it referred to as fair, reasonable and non-discriminatory (FRAND).

"Ericsson has tried long and hard to amicably come to an agreement with Samsung and sign a license agreement on FRAND terms. We have turned to litigation as a last resort," Kasim Alfalahi, chief intellectual property officer at Ericsson said in a statement on Tuesday.

Alfalahi noted Ericsson has over 30,000 patents and more than 100 license agreements with major players in the industry.

A surge in smartphone and tablet computer sales has driven a switch in traffic on telecoms networks from mainly voice calls to video and music, which take up more capacity.

But although data traffic is surging - smartphone subscriptions alone are expected to rise to 3.3 billion by 2018 according to Ericsson's own figures - operators are finding it hard to get customers to pay much extra, squeezing their profits.

With Ericsson suffering a big drop in sales at its network unit - down 17 percent in the third quarter - it is increasingly turning to the courts to maintain its patent income, part of a wider trend where big technology names are fiercely protecting their intellectual property as global sales of tablets and smartphones boom.

One lawsuit by Apple relating to patents resulted in a $1.05 billion jury verdict against Samsung, the world's largest cell phone and television maker, in August.