Chinese telecommunications giant Huawei Technologies Co expects its patent-licensing arrangements in the industry to expand and help boost revenue, as US trade sanctions continue to hurt its core smartphone and carrier equipment businesses.
More than 2 billion non-Huawei smartphones have already benefited from licensing deals involving the firm’s 4G and 5G mobile technologies in the past five years, according to data presented during Huawei’s intellectual property (IP) conference on Wednesday at its headquarters in Shenzhen.
Huawei indicated that most premium Android smartphones in the global market use its licensed 4G and 5G technologies. Most of these licensees are from mainland China, the US and other Asian countries, including South Korean smartphone giant Samsung Electronics, according to the company, which did not provide further details.
“We expect revenue from patent licensing will continue to grow, but the company does not operate this as its main moneymaking business,” said Alan Fan, head of the intellectual property rights department at Huawei.
Privately-held Huawei previously estimated that total sales generated from patent licensing reached “about US$1.2 billion to US$1.3 billion” between 2019 and 2021.
Patent licensing is an area that Huawei has increasingly cultivated, as the company seeks to counter the effects of Washington’s trade sanctions that have cut off its access to major US-origin technology – including advanced software and cutting-edge chips.
Huawei, the world’s largest telecoms equipment maker and formerly China’s biggest smartphone vendor, was added to Washington’s trade blacklist in 2019. It has scrambled to adapt its operations to tighter restrictions imposed in 2020, covering access to chips developed or produced using US technology, from anywhere.
The company is stepping up efforts to turn its vast pool of patents into revenue via “reasonable pricing” to diversify its sales mix, according to founder and chief executive Ren Zhengfei in an internal meeting in March.
