While HTC Corp. (TPE:2498) seemed relatively indifferent to rumors that it was paying Microsoft Corp. (MSFT) a licensing settlement of $10 USD per Android smartphone sold, its chief executive Peter Chou reacted decisively to claims that it was paying between $6 and $8 USD to Apple, Inc. (AAPL) per device sold for a similar license fee.
Speaking at KDDI Corp.'s (TYO:9433) launch of the J Butterfly handset -- the twin to Verizon Wireless's upcoming Droid DNA -- the HTC CEO remarked, "I think that these estimates are baseless and very, very wrong. It is a outrageous number, but I'm not going to comment anything on a specific number. I believe we have a very, very happy settlement and a good ending."
HTC and Apple agreed to a truce in their patent war earlier this month. The patent war between the smartphone makers began in 2010, after HTC became the first Android phonemaker sued by Apple. Apple won some preliminary trade court rulings that allowed it to block shipments of HTC handsets into the U.S. back in May, forcing retailers to make due with existing inventory. The blockade was lifted after a couple of weeks after HTC removed the UI element in contention.
But more recently Apple saw its litigation against HTC stall, with courts refusing bans on top HTC handsets. At that point Apple CEO Tim Cook finally appeared to get serious about licensing, realizing that simply trying to ban HTC might not be the most beneficial approach. Months later a truce was realized.
Details of that truce were not made public, but the financial impact was not severe enough to cause HTC to bump its earnings guidance lower. If Apple is indeed receiving less than $6 USD per handset, as Mr. Chou's comments seem to imply, that means that its intellectual property licensing rights are worth half of what Microsoft's are, or less.
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