Nokia and Xiaomi have signed a patent licensing agreement to share cellular and network knowledge, patents, and equipment.
On Wednesday, the Finnish network equipment maker and Chinese smartphone maker said they have signed a business collaboration agreement and a multi-year patent deal, which includes a cross-license to each other's cellular standard-essential patents.
According to the companies, Xiaomi has also purchased patent assets from Nokia as part of the agreement.
Financial details were not disclosed.
Under the terms of the deal, Nokia and Xiaomi will work together on optical communications solutions for data centers, IP Routing for the Nokia FP4 processor, and a data center fabric solution.
Nokia will provide network infrastructure equipment for the projects, and both firms will also collaborate on research in areas including the Internet of Things (IoT), augmented and virtual reality, and artificial intelligence.
Nokia already has licensing agreements with smartphone manufacturers including Samsung and Apple, but this is the first time the Finnish company has inked a deal with a Chinese firm. However, as OP Equities analyst Hannu Rauhala told Reuters, this could be "a good head start to negotiations with other Chinese manufacturers."
"As a company seeking to deliver more exciting technological innovations to the world, we are excited at the opportunity to work more closely with Nokia in future," said Lei Jun CEO of Xiaomi. "Xiaomi is committed to building sustainable, long-term partnerships with global technology leaders."
"Our collaboration with Nokia will enable us to tap on its leadership in building large, high-performance networks and formidable strength in software and services, as we seek to create even more remarkable products and services that deliver the best user experience to our Mi fans worldwide," Jun added
In June, Nokia revealed an agreement with Spark to upgrade the New Zealand carrier's network using IP software and optics equipment over the next three years.