Huawei planning enforcement of 5G patent royalty fees for Apple, others
Struggling Huawei intends to charge up to $2.50 per phone for use of its 5G patents in the next iPhone, future Samsung Galaxy, and more.
Huawei
As Huawei's dispute with the US continues, the Chinese manufacturer is still releasing new phones -- and now intends to capitalize on its patent portfolio.
According to Bloomberg, executives at Huawei Technologies Co. are to introduce "reasonable" fees for companies such as Apple to license its 5G patents. Reportedly, Huawei holds the largest portfolio of such patents, and it intends to negotiate cross-licensing deals with Apple and Samsung.
Huawei's Chief Legal Officer Song Liuping says that over the period 2019 to 2021, the company expects to collect between $1.2 billion and $1.3 billion in patent and licensing deals. The company has not clarified what proportion comes from 5G, nor how much of that three-year amount is expected to come from the new deals.
The company did say that it intends to charge lower rates than rivals including Ericsson AB, Nokia Oyj, and Qualcomm. While it has not specified details, it plans to cap the amount of royalties per phone handset sold to $2.50.
Rivals such as Qualcomm have previously charged a percentage whose equivalent dollar price ranged between $13 and $20.
Qualcomm currently provides Apple with its 5G modems for the iPhone 12 range, although Apple is believed to be developing its own for the next iPhone, or the iPad Pro.
It's also unclear if Huawei expects Apple to adopt its technology when presumably Apple's own 5G systems have already been in development for some time. Nor has the company discussed whether it has any existing technology deal with, for instance, Qualcomm, which it now wants to renegotiate.
However, 5G technology are already being subjected to patent disputes. Bloomberg reports that litigation over the ownership and usage of 5G patents is likely to increase, although it notes that Huawei has not discussed how it will enforce its rights.
Huawei
As Huawei's dispute with the US continues, the Chinese manufacturer is still releasing new phones -- and now intends to capitalize on its patent portfolio.
According to Bloomberg, executives at Huawei Technologies Co. are to introduce "reasonable" fees for companies such as Apple to license its 5G patents. Reportedly, Huawei holds the largest portfolio of such patents, and it intends to negotiate cross-licensing deals with Apple and Samsung.
Huawei's Chief Legal Officer Song Liuping says that over the period 2019 to 2021, the company expects to collect between $1.2 billion and $1.3 billion in patent and licensing deals. The company has not clarified what proportion comes from 5G, nor how much of that three-year amount is expected to come from the new deals.
The company did say that it intends to charge lower rates than rivals including Ericsson AB, Nokia Oyj, and Qualcomm. While it has not specified details, it plans to cap the amount of royalties per phone handset sold to $2.50.
Rivals such as Qualcomm have previously charged a percentage whose equivalent dollar price ranged between $13 and $20.
Qualcomm currently provides Apple with its 5G modems for the iPhone 12 range, although Apple is believed to be developing its own for the next iPhone, or the iPad Pro.
It's also unclear if Huawei expects Apple to adopt its technology when presumably Apple's own 5G systems have already been in development for some time. Nor has the company discussed whether it has any existing technology deal with, for instance, Qualcomm, which it now wants to renegotiate.
However, 5G technology are already being subjected to patent disputes. Bloomberg reports that litigation over the ownership and usage of 5G patents is likely to increase, although it notes that Huawei has not discussed how it will enforce its rights.
Comments
/gobsmacked
It might surprise you to know that Huawei outspends almost all its competitors in 5G R&D spending and has amassed a gigantic pool of patents, many of them from in-house efforts.
It has also been reported (for years) that Apple has a licencing agreement with Huawei which sees Apple paying them millions for almost 800 of its patents.
Patent disputes do pop up and sometimes they are won and sometimes they are lost. That's business as usual for all big companies.
Last time I heard, Apple was involved in far more patent disputes than Huawei. And I mean by a huge margin.
Huawei has almost 100,000 employees involved in science and engineering spread around the world.
Just one example:
https://www.gizchina.com/2020/10/11/huawei-opens-its-sixth-research-institute-in-france-focuses-on-mathematics-and-computing/
They aren't twiddling their fingers and, worldwide, set thousands of their scientists onto the task of achieving major breakthroughs in things like Polar Codes.
https://www.forbes.com/sites/moorinsights/2020/02/27/5g-patent-value-is-more-important-than-number-of-patents/?sh=74b8cf677941
By value, Qualcomm is leading,
https://www.lightreading.com/asia-pacific/who-rules-5g-patents-it-depends-how-you-ask/d/d-id/756790
"This was that Ericsson is the biggest 5G patent owner with 15.8% of filings, followed by Samsung (14.8%) and Qualcomm (12.9%). Huawei and ZTE rank fifth and seventh respectively.
The team at Bird & Bird conclude: "When running the analysis with a broader range of assumptions and metrics, we find that there is no consensus that China is in the lead. Depending on the precise inputs, European, South Korean, Chinese, and US companies can all take the top spot(s)."
The point is that Huawei "amassing a gigantic pool of patents" doesn't necessarily equate to them being the leader in 5G patents, but it is good marketing for them.
Me, I'm thinking that whatever Apple pays for licensing, is quite a value when they are selling something on the order of 150M 5G iPhones in a single year.
Those patents are the fruit of billions invested in R&D.
I didn't touch on the 'value' of patents. That was not the focus and is irrelevant here.
When I mentioned its vast patent pool, I was referencing the company's advances across the board, not just 5G (of which it has thousands). Those patents are more than enough for it to hold key seats on standards boards around the world.
Of course it doesn't stop with 5G. The spread covers the whole gamut of technology branches and isn't limited to applications in China.
In Europe:
2017
https://www.thenewbarcelonapost.com/en/huawei-leads-the-ranking-of-the-companies-that-request-more-patents-in-europe/
2020
https://www.telecomreview.com/index.php/articles/telecom-vendors/3745-huawei-tops-europe-patent-applications
Worldwide:
https://www.reuters.com/article/us-usa-china-patents-idUSKBN21P1P9
"According to the WIPO data, China's Huawei Technologies [HWT.UL], the world's biggest maker of telecoms equipment, was the top corporate patent filer for the third consecutive year."
Strange that the OP didn't even bother to look at the bigger picture. Who better than Huawei itself to state their position:
https://www.google.com/url?sa=t&source=web&rct=j&url=https://www-file.huawei.com/-/media/CORPORATE/PDF/white%20paper/2019/Huawei_White_Paper_on_Innovation_and_Intellectual_Property.pdf&ved=2ahUKEwjfx_mlyLXvAhUNfMAKHVL-DvEQFjAAegQIBhAC&usg=AOvVaw3rIZ0WxU2bhKb4pCXV6HtW
Edit: original link wasn't working. Updated with Google URL
We agree to disagree.
I don't believe that avon b7 cares about anything other than Huawei when it comes to telecom infrastructure, 5G modems, AI, ML, servers, handsets, or surveillance, all being capabilities of Huawei. He never asks about how that happened (spoiler alert: Chinese Government support and financing, some IP theft, and mercantilists policies to kill off the competition).
Odd, because he lives in Spain, and you would think that he would want to support European telecom efforts.
Nope.
His world, for the most part, revolves around Huawei.
I see that is beyond you when the relevant information leaves you with nothing to offer as a counterpoint to what has been said.
As for patents, SEP, IP, licencing fees innovation etc, here is yesterday's presentation of the updated IP 2021 White Paper (earlier on I posted a link to the. Pdf of the original from 2019) which includes the announcement of the USD $2.50 per handset cap on licencing of Huawei's 5G technology.
"We say so, so it's true" is not a legitimate argument for you, or Huawei, to make if there is no actual transparency in their operation. The CCP has already demonstrated that it has power over private companies in the PRC ( see Jack Ma/alibaba) without legislative process, a key indication that China can control any company that it wishes, when it wishes, for whatever reason that it wishes. The West is quite aware of this.
At this point in time, ownership really doesn't matter though, because Huawei has already felt the impact of being too closely associated with the CCP, and remediation of the telecom market in the West to an even playing field is already occurring. The marketplace has shifted to Eriksson, Nokia, Samsung and OpenRAN over Huawei's mercantilist marketing.
I have no problem with Huawei licensing its 5G and being compensated for that. If Apple, et al, don't agree with that, there are legal ventures to argue that.
The West is responding to China's economic coercion via trade;
https://www.smh.com.au/world/asia/after-us-pledge-on-china-coercion-beijing-lays-blame-back-on-australian-government-20210317-p57be1.html
"China has laid the blame back on Australia for the deteriorating relationship between the two countries, dismissing the concerns of the US Indo-Pacific chief ahead of the first meeting between the two superpowers in Alaska.
Responding to comments by President Joe Biden’s top aide in the region, Kurt Campbell, China’s Foreign Affairs Ministry on Monday said that it was not responsible for the breakdown in communication between the two countries after more than a year of trade strikes on $20 billion worth of exports."
"The root cause of the current difficulties in bilateral relations is Australia’s wrong words and deeds on issues concerning China’s sovereignty, security and development interests, which have undermined the foundation of mutual trust and cooperation between the two countries,” said foreign ministry spokesman Zhao Lijian."
China used economic coercion to attempt to get Australia to allow Huawei. That failed, yet the coercion continues as Australia responds to Hong Kong's loss of democracy, and human rights violations.
The U.S. has stepped in to support Australia.
"We say so, so it's true" is not a legitimate argument for you, or Huawei, to make if there is no actual transparency in their operation. The CCP has already demonstrated that it has power over private companies in the PRC ( see Jack Ma/alibaba) without legislative process, a key indication that China can control any company that it wishes, when it wishes, for whatever reason that it wishes. The West is quite aware of this"
First you launch your customary attacks based on rumours, allegations, heresay and then paint them as fact.
When someone challenges you with real information straight from the company itself and provided precisely to debunk the kind of allegations you are making, it still isn't acceptable to you.
Truth be told here. Nothing ever will because your mind is already made up. Your bias is clear. It shines through with everything you post about China and Huawei.
Huawei is a private company. There is no law anywhere that obliges it to be anything else. In fact, in these turbulent times, it is far better off being private.
As for transparency, I hope you realise that Huawei's numbers are independently audited and presented yearly. You know, like with many private companies.
In terms of government power over private companies... tell me where that is NOT the case.
Do you think AT&T wouldn't have distributed Huawei Mate 10 handsets all over the US if it weren't for government strong-arming them out of a signed deal?
I can tell you that NONE of the rural carriers using Huawei gear in the US wanted to rip and replace it. Absolutely NONE.
The same applies to literally all Huawei customers worldwide that have been forced by their own governments (as a result of US bullying) to rip out Huawei gear.
Please refrain from talking about 'legislative process' in the US.
Snowden aired a lot of US dirty washing in that field and we might just be a very short while away from a potential bombshell which I will actually comment on because it is related to Huawei.
There is very real reason to suspect that the Canadian arrest of Huawei's CFO may have been tainted by underhand US government actions.
We already know (this is beyond doubt) that certain information from the famous PowerPoint presentation was not presented to the Canadian authorities. That is information that clearly points to knowledge by HSBC of certain facts.
Now the question that has arisen is if that information was deliberately withheld on the request of the US government and in exchange for favourable treatment of HSBC from the US.
Both the US and HSBC are fighting tooth and nail for this information NOT to be released.
Was it you who wanted transparency?
I won't go into the other areas of utterly disgraceful treatment of due legislative process by a country which is known to have sought out other countries worldwide to 'ship' detainees to precisely to avoid being held to account by that due legislative process. That is not relevant here, but do your own homework and visit your very own Brown University for a clear breakdown of what has been going on.
In the meantime, what I have provided in those two videos and pdf is more than enough to balance some of the crazy comments that pop up from time to time.
It is for readers to draw their own conclusions.
Meng is at least getting proper council and a trial in a country with a first rate legal system; Michale Kovrig and Michael Spavor are not so fortunate to have house arrest.
There isn't any question in my mind that the arrest of the two Canadians was retaliatory, and that in itself is proof of the close links that Huawei has with the PRC and CCP.
Does Huawei actually pay anyone else for their IP?
I know that China is notoriously cavalier about IP - I know that even cash strapped Russia is reluctant to sell them weapons systems because they know that China is a vast photocopy machine and they'll soon see clones being sold by China to other countries.
As stated in the linked video on IP, there are incoming, outgoing and cross licencing deals so yes, Huawei pays out huge sums for the use of IP from other companies.
The laws in China on IP are a Chinese thing. They have nothing to do with Huawei.
Now, Ukraine, under pressure from the U.S., has decided to nationalize its aircraft engine business, instead of allowing China's acquisition of it:
https://www.wsj.com/articles/ukraine-to-nationalize-defense-firm-keeping-china-out-in-a-nod-to-u-s-11615908836?st=p6wntrka3cce5y3&reflink=share_mobilewebshare
China has been on a massive IP acquisition campaign for decades, coercing, stealing, or attempting to buy technology they need to be self sufficient, but the world has wised up to their militarism and mercantilism. Huawei go caught up in that as well, and initially Australia, then the U.S., and finally many countries in the EU reversed course on allowing Huawei into their critical infrastructure.
That avon b7 keeps protesting that is due to his inability to understand National Security, and yes, China is lax, to say the least, in its protection of foreign IP. The Biden Administration will change some aspects of U.S. trade policy, but expect that China will continue to get deserved scrutiny from the rest of the world.
I simply point out where you are wrong.
It is supremely ironic that you dump the coercion label in here while simultaneously talking about the UK's change of tack on Huawei.
That decision was not taken on the back of any technological evaluation because that particular risk assessment had already been presented.
Nope. This was US coercion of a supposed ally. And while National Security is a concept ALL nations have to deal with, it is laughable when a country attempts to impose its own concerns extraterritorially.
It was Australia that initiated all of this not the U.S., though the U.S. certainly carried the baton later.
https://www.iiss.org/publications/strategic-comments/2019/australia-huawei-and-5g
"In 2018, Australia became the first state in the Five Eyes intelligence alliance to issue security guidance obliging its telecommunications carriers to avoid purchasing fifth-generation (5G) equipment or services from the Chinese firm Huawei. Canberra’s decision underscored the ongoing debate within the alliance over whether to try to manage or eliminate entirely the potential risks of espionage and sabotage brought by foreign involvement in national 5G networks."
https://www.cips-cepi.ca/2020/10/16/huawei-or-our-way-fissures-in-the-five-eyes-alliance-in-the-face-of-a-rising-china/
In January this year, the UK Government broke ranks with its Five Eyes allies, confirming that Huawei would be involved in building part of its 5G network. The decision defied warnings from the United States that “if countries choose to go the Huawei route, it could well jeopardize all the information sharing and intelligence sharing we have been talking about, and that could undermine the alliance, or at least our relationship with that country.” Britain’s stance was also out of step with the declared positions of Australia and New Zealand. One US official decried the UK’s decision to put technological and economic expediency ahead of Five Eyes solidarity as a “sucker punch” on “an absolutely key issue at a critical juncture.”
"The condemnation of allies and growing domestic political pressure has since provoked a reversal in the UK position on Huawei. In mid-July, British Secretary of State for Digital, Culture, Media and Sport,Oliver Dowden, announced that buying new Huawei equipment would be banned after December 2020 and that all existing Huawei technology would be removed from 5G networks by the end of 2027. Many consider the timeframe too long, and also note that Britain’s earlier position was made virtually untenable after the US banned semiconductors that rely on US chip technology from provisioning Huawei without US government permission. Nonetheless, there is relief among the Five Eyes community that a consistent position on the use of Huawei for critical infrastructure has ultimately emerged. (For its part, Canada has not yet officially prohibited Huawei technology in its 5G build, but many observers consider it inevitable following Britain’s change of heart."
The Huawei episode illustrates the challenges of keeping the alliance together in the face of growing pressure from China. Why, despite all the warnings, was the UK prepared to compromise such an important and longstanding alliance? Certainly, the comparative cheapness of Huawei technology was a consideration, but many commentators have also pointed to the very adept way that Huawei – and Chinese interests more broadly – have infiltrated the British establishment and bought influence at the highest levels. Before the ban, Huawei’s UK board boasted some of the biggest names in British industry – among them Lord Browne (former CEO of British Petroleum), Sir Andrew Cahn (former head of UK Trade and Investment) and Sir Mike Rake (former president of the UK Confederation of Industry). The UK is by no means unique in this regard. While Australia has, to date, taken a tougher line towards China, it is not for want of Chinese attempts to buy influence. Huawei was the biggest sponsor of overseas travel for members of the Australian parliament between 2010 and early 2018, and in recent years, Huawei’s Australia’s board has boasted the services of former foreign Minister Alexander Downer, former Premier of Victoria John Brumby, and a former Rear Admiral of Australian Navy John Lord.
It seems inevitable that the Huawei episode will be just the first of many tests to Five Eye’s solidarity as China seeks to parlay economic power into geopolitical influence, and the United States responds in kind. So far, Australia has shown itself most willing to follow the US’s more hawkish lead. In September, the Australian government passed legislation barring state governments from reaching agreements with foreign powers deemed to be ‘not in the national interest.’ The first casualty of the Australian government’s new powers will almost certainly be the Victorian government’s 2019 agreement to participate in Beijing’s signature Belt and Road infrastructure-building initiative (BRI). By contrast, New Zealand signed onto the BRI in 2019. When the Five Eyes countries attempted to put forward a unified front condemning the erosion of civil liberties in Hong Kong earlier this year, New Zealand demurred. The eventual statement had only four signatories – the US, UK, Canada, and Australia.
In a post-COVID world the difficulty of keeping all Five Eyes allies on the same strategic page is only going increase. Small, export-reliant, and now heavily indebted countries like NZ cannot afford to jeopardize trade with China. Indeed, New Zealand need only look across the Tasman Sea to know that taking a tougher stance towards Beijing can have immediate economic repercussions. Similarly, the Victorian Labor government’s MOU with Beijing suggests a change in partisan government at the national level could well see Australia split from the US and adopt a more accommodating position toward China. Canada too, may not be so unflinching the next time China slaps a ban on Canadian canola or sentences Canadian citizens to death on dubious charges. In sum, it seems very unlikely that the Five Eyes alliance will hang together as naturally and seamlessly as it did during the unipolar period of the immediate post-Cold War era.
It's not like China hasn't been playing hardball as well, but as I have stated in the past, human rights violations, and the takeover of Hong Kong early by the PRC, have tilted the arguments against China.
So, Canada and New Zealand haven't moved forward on Huawei, but they haven't outright banned them yet either, while the U.K.
https://www.uktech.news/what-will-the-impact-of-huaweis-5g-ban-have-on-the-uk
"Most worryingly, fears have mounted over the involvement of Huawei and a decision has been taken to exclude them from Britain’s 5G network. A new bill has been proposed which will see the UK government take over control of the 5G networkand stop private companies from self-regulating.
Telecoms providers will therefore stop installing Huawei equipment and it is likely this will take effect in September 2021. But what will the impact of Huawei’s 5G ban have on the UK and could there be long-term ramifications?"
What about Germany?
https://ecfr.eu/article/what-germanys-new-cyber-security-law-means-for-huawei-europe-and-nato/
Completely unable to commit to a decision, all driven by trade with China.
"And yet, as a leader within Europe and a supporter of democratic values and level playing fields in trade, Germany’s stubborn refusal to ban Huawei places it in an awkward position when it comes to international efforts to cooperate on 5G. Existing ideas, such as the UK’s D-10 club of democracies, the United States’ Clean Network Initiative, or the proposed Technology 10 alliance, each share the goal of reducing China’s dominance in 5G and tech infrastructure. The EU’s own 5G toolbox, which Germany supports, calls for “a coordinated approach” to 5G network security both domestically and across the EU. But Germany cannot easily advocate international cooperation on emerging tech if it forges its own path on Huawei. Berlin’s Huawei indecision will only embolden smaller nations with less robust economies to point to the German example in choosing the more budget-friendly Chinese kit for their domestic 5G networks.
Berlin’s choice will also have implications for NATO. With Germany seeking to shore up and encourage America’s recommitment to the organisation, the decisive indecisiveness it has adopted on Huawei is a step backwards in re-engaging with Washington. On 5G, leading NATO members like the US and Germany should be championing efforts to ensure uninterrupted interoperability through bloc-wide standards and minimum network security requirements. This coordination from the outset is necessary because 5G will give the alliance new opportunitiesfor data- and intelligence-sharing as well as allowing it to take advantage of new technologies based on advances in artificial intelligence and machine learning. But with advanced network connectivity comes heightened network vulnerability, and NATO can only realise the full potential of 5G if there is coordination across all member countries.
With this draft law, Berlin has effectively punted down the road a definitive decision on 5G. How the legislation will look in its final form remains to be seen, but Berlin’s preference for Beijing’s tech over Brussels’ wishes is clear. Should the German government fail to take concrete action to block Huawei from its networks, the new law will put Germany at odds with key allies on an issue that has deep implications for security, defence, and the economy."
I'm done with arguing about Huawei, but it is clear that Huawei has hit its high water mark in telecom in the West, and is on a descent.
Good. Enough of supporting China's authoritarian expansionism, and blatant mercantilism, that almost succeeded in killing competition in 5G, but failed.