Huawei Goes with Double Play Strategy, Asks US Firms to Begin Paying Patent Royalties

Huawei Goes with Double Play Strategy, Asks US Firms to Begin Paying Patent Royalties

Huawei had estimated that it would lose about $30 billion internationally as a result of the bans in U.S. But it seems the company will cover a good part of that money by asking American companies which license its patents to pay more royalties, CNBC reports; Verizon, a leading telco, could be owing $1 billion.  Of course, doing that could be seen as using “monopoly” power [think Apple and Qualcomm legal case], but I am not sure who will make that call right now: ‘CEO Ren Zhengfei says he “may try to get some money” from firms using the company’s intellectual property’..

Huawei may demand more royalties from U.S. firms for technology they’re using that’s been patented by the Chinese telecom giant, experts say, as the beleaguered firm looks to fight back against continued pressure from Washington.

It would mark a big shift in strategy for Huawei, which typically is not seen as especially litigious in terms of intellectual property rights (IPR), even though it holds some crucial patents that underpin the world of telecommunication.

Last week, Reuters reported that Huawei had asked Verizon to pay $1 billion in royalties for more than 230 of Huawei’s patents. The Wall Street Journal reported that the patents related to Huawei range from core network equipment to so-called internet of things technology — defined as physical devices that are linked to one another over the internet. The Verizon case is not a legal case at the moment.

According to WIPO, Huawei filed most patents in 2018 in the world. Huawei filed 5,405 patents, Mitsubishi came second at 2,812 with Intel third at 2,499. CNBC reports that “Huawei owns the highest number of so-called “standard essential patents” for 5G in the world”. Unless the U.S. Congress updates its laws, Huawei can use U.S. Courts to pursue its claims.

China-based telecoms giant Huawei Technologies, with a record number of 5,405 published PCT applications, was the top corporate filer in 2018. It was followed by Mitsubishi Electric Corp. of Japan (2,812), Intel Corp. of the U.S. (2,499), Qualcomm Inc. of the U.S. (2,404) and ZTE Corp. of China (2,080). ZTE Corp., which was the top applicant in 2016, saw a 29.8% drop in the number of published PCT filings in 2018, its second straight year of declines. The top 10 applicant list comprises six companies from Asia, two from Europe and two from the U.S.

If you check clearly, this is double play strategy.


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