CNBC reported on the 16th (local time) that Huawei in China has decided to impose royalties on smartphone makers using its 5G patented technology in the future.
According to reports, Huawei said, “We are trying to charge a reasonable rate of royalties according to the selling price of the handset,” and that “the maximum royalty ceiling per 5G smartphone will be around $2.50.”
These royalties are lower than competitors like Nokia, CNBC said.
Nokia charged a royalties of $3.58 per device for 5G standard patents. Ericsson costs between $2.50 and $5 each.
Huawei is facing great difficulties due to the recent strong sanctions from the US government. Huawei, which once jumped to the second place in the smartphone market, has significantly decreased its market share as it has become difficult to use core US technologies including Android.
In this situation, if royalties are imposed on 5G patent rights, it is expected that a substantial portion of the sales lost due to US sanctions can be preserved.
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Huawei is known to have more than 3,000 5G-related patents. According to Gray B, an intellectual property research organization, 18.3% of Huawei 5G patents are essential standard patents.
In the meantime, Huawei has not been very aggressive about royalties or patent litigation. However, CNBC said that this trend is expected to change as it suffers from US sanctions.