Nokia vs. Reddit: Patent infringement is in question

Reddit’s IPO marks a real milestone in the company’s success story. But the whole thing also has its downsides. Reddit has to put all its cards on the table. For the public, this means some surprising findings. For example, it has now come to light that there is apparently a patent dispute between Nokia and the social news aggregator.

Reddit must prove transparency

It has not been long since Nokia pointed out an infringed patent. According to Reddit itself, the Finnish company is said to have sent a letter to this effect on March 18, 2024. The social news forum would like to investigate the allegations in detail. Reddit has now informed the US Securities and Exchange Commission of this. Unfortunately, the company has not provided us with any more information. The whole thing certainly has a bitter aftertaste. As this is a patent infringement, it could have a major impact on business practices.

This step is essential if the IPO is to be successful. After all, you don’t want investors to complain afterwards that they didn’t know the whole truth about the company’s background. Apple is currently proving what can happen when there is miscommunication between a listed company and investors. The tech company has to pay 490 million US dollars in damages to investors because CEO Tim Cook made a mistake in his choice of words.

Reddit plans more advertising

To ensure that the launch on the trading floor is as successful as possible, Reddit’s management team appeared very talkative in a video and answered many questions. There was no real surprise here. Instead, they tried to lull investors into a sense of security. It is emphasized that the IPO will not bring any noticeable changes for the users themselves. Only the amount of advertising is likely to increase. This step is probably unavoidable in order to increase revenue accordingly. The company intends to rely on the support of artificial intelligence for advertising.

No voting rights for new investors

The video also reveals the type of shares Reddit wants to sell on the stock exchange. These are so-called type A and type B shares. While type A shares carry one vote in voting, type B shares are securitized with ten votes. According to Reddit management, new shares will only be sold as type A shares. The 137 million type B shares are already held by the company’s active shareholders. For this reason, investors should not invest money with the intention of bringing about change at Reddit.