Samsung Electronics Renews Technology sharing Agreement with Huawei

Samsung Electronics has recently renewed a technology-sharing agreement with Huawei, according to media reports.

According to a report by The Elec, a Korean online media outlet specializing in electronics parts, Samsung Electronics transferred 98 patents it has in the United States to Huawei in November 2022. The value of the transferred patents is said to be equal to the difference in their cross-licensing agreement.

The report says Samsung handed over 81 patents to Huawei in 2019 under a cross-licensing deal, which was intended to put an end to ongoing patent disputes. 

Huawei disclosed on Dec. 9 that it has recently patent license deals with Samsung Electronics.

Alan Fan, head of Huawei’s Intellectual Property Department, said in a press briefing that Samsung is Huawei’s biggest licensee among foreign companies in terms of the number of devices sold and the patents covered.

Huawei said it has patent cross-licensing deals with 20 companies, including Chinese and foreign players. The licensees include Oppo, the world’s fourth-largest smartphone maker by shipments. The deal with Oppo is Huawei’s largest ever with a Chinese company.

According to Nikkei Asia, Huawei has been working to expand revenue from patent licensing after U.S. sanctions disrupted its core smartphone and telecom equipment making businesses. The company said its revenue from patent licensing was between US$1.2 billion and US$1.3 billion from 2019 through 2021, and such revenue was growing.

n 2016, Huawei filed a patent infringement suit against Samsung Electronics with the U.S. District Court for the Northern District of California and the Shenzhen People’s Court in China, alleging that Samsung used its 4G communication standard-related patents without approval. Courts in China and the United States collided hard, siding with Huawei and Samsung Electronics, respectively. In March 2019, the two sides settled their disputes out of court, signing the cross-licensing agreement.

As Huawei’s semiconductor and smartphone businesses have been hampered by strong trade sanctions from the United States, Huawei is seeking new revenue generation through patent licensing. It is actively taking advantage of its position as the No. 1 company in 5G standard patents. From 2017 to 2020, Huawei filed the largest number of patents with the World Intellectual Property Organization (WIPO) among global companies. In particular, the Chinese IT giant boasts overwhelming competitiveness in the field of 5G technology.

Huawei also hinted at expanding the royalty business based on a solid patent portfolio. At an intellectual property (IP) forum held at its headquarters in Shenzhen, China last year, Huawei announced that it would negotiate licensing agreements including 5G patent usage fees with major 5G smartphone makers such as Samsung Electronics and Apple. At the time, Huawei proposed a policy of imposing royalties of up to US$2.5 per 5G smartphone.

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