Huawei Wants To Raise Royalties For Its US Partners

Huawei might demand that its US partners pay even more in royalties, when they use its patents. Right now, Huawei has the most "standard essential" patents for 5G, which would mean that most - if not all - US partners need to pay royalties to Huawei.

This would be a big change for Huawei. It doesn't typically litigate with its partners over royalties. That's something that Qualcomm does quite a bit and has become a very lucrative thing for them. Huawei has already asked Verizon to pay around $1 billion in royalties, since it is using more 230 of Huawei's patents.

Patents that Huawei holds, range from the core network equipment all the way to Internet of Things technology. Which means that it's a pretty broad range, and anyone that uses any type of network in the US, is likely going to need to pay Huawei.

Huawei's CEO, Ren Zhengfei stated that Huawei would be seeking royalties from more firms. Verizon was just the first company that was named by the Chinese electronics giant. Ren stated that "over the past years, we were not aggressive seeking IPR royalties to companies that use our IPR - that's because we were busy pursuing our business growth. Once we have more time off, we may try to get some money from those companies who use our IPR." But Ren did say that it would be used as a weapon.

It does seem a bit odd that a Chinese company would have so many patents. Considering the Chinese really don't care about patents. But Huawei does have over 56,000 patents. And they are all hanging in the main hallway of their headquarters in Shenzhen, China. We have witness this, when we've visited their headquarters a few years ago. Since Huawei is a leader in the 5G space, it only makes sense that it does have a ton of 5G patents, and carriers are going to have to use them, to make their 5G network.

While Huawei's CEO isn't coming out and saying that this is due to the Trump Ban, it is pretty obvious that it is. This ban is costing Huawei millions (and it could soon be billions). It is also costing them their place in the smartphone market, as many people are not buying their smartphones any longer, as they are unsure if their shiny new smartphone will get updated to Android Q and beyond. But as Huawei have said before, this ban is hurting not only China, but also US companies.

In the US, a lot of rural ISPs use Huawei's networking gear to get Internet to everyone that is in the sticks. This is because it is cheaper than using Nokia or Ericsson's gear. And in a lot of cases it is also better. So not only are these ISPs going to need to spend millions to replace it, but the US is also going to be hurting as there will be less competition in the space. And US jobs are also at risk. Which sounds odd, but it's true. Huawei has a few offices in the US, that are likely going to close once the ban is in effect in August.

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Alexander Maxham

Head Editor
Alex has written for Androidheadlines since 2012 as Editor of the site and traveled the World to many of the biggest Smartphone and Technology events. Alex has a background in Technology and IT and Deep Passion for Everything Android and Google. His specialties lay in Smartphones of all budgets, Accessories, Home Automation and more. Contact him at [email protected]