Apparently Apple has refused to agree to “appropriate” licensing terms, preferring to fight this one out in the courts. The Delaware Federal District court will get a chance to square this one away (in the coming years). Nokia is vague on specific patent applications, claiming that they cover “wireless data, speech coding, security and encryption”. It is unknown if these are hardware or software patents, but it is likely a mix therein.

I doubt that Apple would throw caution at the wind and willfully infringe patents, but the problem likely lies in the negotiations for royalties. Either Nokia is demanding too much, or Apple is just being stubborn, perhaps hoping to get away with lower royalty demands through the American courts. A home lawsuit may carry bias to an American company, and Apple may be more likely to win regardless of implications. We’ll be following this case closely.

Earlier this week Nokia published their 2009 third quarter earnings [PDF], and the numbers don’t look so good. The big headlines are revolving around a €559 million quarterly net loss and global smartphone market share down to 35% (from 41%, Q2). This marks Nokia’s first quarterly loss in a decade.

Investors we’re caught surprised at the dramatic drop in smartphone market share. The 6 percent drop in a single quarter caused Nokia’s stocks to take a dip on the Helsinki exchange.

“The scale of the smartphone (market) share loss must give the markets pause for thought over the coming days. Dropping six points in three months is pretty stunning”

Tero Kuittinen, MKM Partners analyst

Why are the numbers down? The main reason cited has to do with a €903 million write off on Nokia Siemens Networks. Then there is increasing competition in the smartphone field. The American market is dominated by RIM and Apple, though Nokia is not too preoccupied. Europe however is another story. With Android handsets gaining popularity in Europe and others such as Palm’s Pre making a strong debut across several European markets, Nokia is starting to feel the crunch in the high-performance segment. Nokia is still king as per market share goes (38% global total), but failures such as the N97 “flagship” adds pressure to future launches.

“Consumer demand may be showing early signs of improvement but these results show sustained pressure on smartphone margins. Apple’s iPhone is defying gravity in the high tier.”

Geoff Blaber, CCS Insight analyst

Nokia seems to be optimistic about next quarter and several analysts say it’s not so bad. With the launch of the N900, E72, X6, and other handsets, Nokia seems to have its hands full. With the holiday season fast approaching, things are sure to pick up. How is Nokia faring in your side of the globe?