Nintendo ordered to pay royalties for every 3DS sold in patent dispute, $105 million so far
A US court has ordered Nintendo to pay a royalty fee to a third-party company for every Nintendo 3DS or 3DS XL sold in the handheld console's history. It is the result of a patent dispute between Tomita Technologies and Nintendo over the 3D camera technology used in the devices.
Nintendo must now pay 1.82 per cent of the wholesale price of every 3DS sold, equating to around $3 (£2) per unit. That will set Nintendo back around $105 million as a one-off payment for the 35 million units already in circulation. And it will have to continue to pay out for the lifespan of the machine, unless it changes the technology used.
READ: Nintendo 3DS XL review
New York district Judge Jed Rakoff explained that he did not want to set the payment per console as a defined sum, as the price of the console could fluctuate and decrease over time. A percentage was a more fair system.
"If, as Tomita suggests, the ongoing royalty rate were expressed as a flat dollar amount per unit sold, Tomita would capture an increasingly large proportion of each sale as the price falls, even as the technology's reliance on the infringed patent remains constant," he said.
"This would result in an unearned windfall for Tomita, and, accordingly, the court prefers an ongoing royalty rate expressed as a percentage of wholesale price."
That will be of little comfort to Nintendo as the 3DS was seen as its big success story while its Wii U home console struggles to garner significant market share. In the UK, the console has sold a meagre 105,000 units in the year since launch, and only 3.91 million worldwide. Sony's sales of the PS4 topped that global figure in little over a month.