By examining Huawei’s patent portfolio, in particular Huawei’s US patent portfolio, some of the company’s recent actions start to make a bit more sense.
Let’s look at it this way:
Caught in a trade war between China and the US and placed on the US blacklist, Huawei currently cannot sell many of its products in the US market.
It does have a large number of US patents that it could possibly sell, but as our analysis shows, most of them fall in low-value categories, at least before Huawei’s 5G patents, many of which are still pending, are taken into consideration. What’s more, we can see that the company doesn’t really have a history of selling large amounts of US patents, and as an operating company, it seems unlikely that it will turn to this avenue as a revenue stream.
What Huawei does have is a large number of high-quality US patents. And it has also spent billions on its R&D, as discussed earlier in the article, and it probably is looking for a return on this investment. As well, from the company’s own white paper, it’s clear that its patent licensing efforts have been on the rise since 2016, and that they were pretty much non-existent prior to this.
Therefore, licensing its US patents seems to be a natural choice for Huawei. In this light, the company’s pressure on Verizon for one billion dollars in royalty fees this June should not really come as a shock. In fact, it might be just the first of many such actions in a concerted effort to increase the company’s patent licensing activities.
Seen in this way, the release at the end of June of Huawei’s White Paper, in which it clearly outlined its past licensing activities, including royalties paid and royalties earned, might be seen as a signal that the company will increasingly turn to licensing its patents to earn revenue.
In some ways, Huawei may simply want to join the ranks of heavyweights such as Nokia and Ericsson, who are reported to make more than one billion US dollars annually from their licensing activities.
And based on the Quality Analysis of Huawei’s US patent portfolio–and its yet-to-be completely revealed 5G patent portfolio, they may just have the high-quality patents needed to do so.