Huawei Technologies Co. will start. imposes a “reasonable” tax on mobile giants like Apple Inc. to gain access to its discovery of 5G wireless patents, which could create a lucrative revenue source by showcasing its global leadership in the next generation network.
The owner of the world’s largest portfolio of 5G patents will negotiate potential rates and over-licenses with the maker of the iPhone and Samsung Electronics Co., said Chief Legal Officer Song Liuping. It aims to pay despite U.S. efforts to block and shut down their network gear out of the supply chain, but promised to cut lower rates than competitors like Qualcomm Inc., Ericsson AB and Nokia Oyj. Huawei should rake in about $ 1.2 billion to $ 1.3 billion in patent and licensing fees between 2019 and 2021, executives said without specifying which ones came from 5G. It limits the kingdoms per phone at $ 2.50, according to Jason Ding, head of Huawei’s intellectual property division.
China’s largest revenue-generating technology company wants a seat at the table with tech giants awaiting the definition of the rapidly changing range of connected cars, smart homes and robotic surgery. Fights are emerging over who will profit from 5G that could reduce the size and breadth of the tech industry ‘s first worldwide patent war – the one over smartphones. But having just been heavily involved in 5G standards boards, Huawei is now embracing U.S. sanctions that have virtually reduced their smartphone business and threatened to ban it. put on his network division overseas.
Huawei will be flexible in negotiating rates on various 5G products – everything from water meters to luxury cars, according to Ding. “One thing for sure is that the $ 2.50 cap is fixed on smartphones,” he said.
Once the world’s largest smartphone maker, China’s corporation has seen a series of U.S. sanctions virtually wipe out its profitable messenger business. With Biden’s administration maintaining the pressure on Huawei, the founder of billionaire Ren Zhengfei has guided the company to grow its portfolio of enterprise clients in transportation, manufacturing, agriculture and other industries. . Its library of 5G patents could turn to a new growth stream if it can raise compensation from competing smartphone players like Xiaomi Corp., Lenovo Group Ltd. and Oppo.
Companies like Qualcomm thrive on levying taxes on technology they deliver to clients like Apple. The two mobile giants have clashed fiercely over what Apple announced an unfair $ 7.50 royalties from each iPhone, which Qualcomm defended as a small price to pay for basic technology. On Tuesday, Huawei officials stressed that American sanctions should not affect its ability to cross-license with U.S. companies because these patents are publicly available. The company plans to plow patent fees back into research to maintain its position in a wireless network against Ericsson and Nokia.
Controversies over patents, however, tend to escalate as 5G becomes mainstream, enabling a number of future applications from autonomous cars to an internet of things. Companies around the world have fought over who will profit from underlying technology, in cases where slot patent owners include Qualcomm and Ericsson against those who use the systems in their products, such as Apple . Regulators and courts around the world continue to engage in valuing patents for essential technology, and whether their owners have any rights to restrict the use of these devices. Huawei officials have not said how to apply for their patent for fear of disputes.
It is a dark issue that is becoming increasingly important as the world moves to 5G. The value of conventional technology was a key issue in smartphone wars, when wireless technology developers like Nokia, Qualcomm and Motorola then battled new entrants such as Apple and Microsoft Corp. The new controversies that could be more profitable as sales of devices using 5G are expected to grow to $ 668 billion globally in 2026 from just $ 5.5 billion in 2020, according to Linked Market Research .