The U.S.-China trade war is in full bloom right now, with Huawei bearing the brunt of the hostility between the two countries. With the situation getting worse every day, the company might resort to the most deadly weapon in its arsenal-its vast portfolio of patents on essential technology.
Anaqua’s AcclaimIP reports that Huawei owns 56,492 active patents on telecommunications, networking, and other inventions. In 2018, the company apparently got 1,680 US patents and its total collection of active patents and published applications is 102, 911.
The U.S. has been suspicious of Huawei since 2012 and the major telecom companies in the country do not use the Chinese tech juggernaut’s equipment. However, Huawei has been pouring in more money into research and development than its Nordic rivals Ericsson and Nokia and has more standard essential 5G patents than any other company in the world.
Thus, whether or not a country decides to use Huawei’s infrastructure, chances are it will still be using one of the technologies that Huawei has a patent on. In fact, some of Huawei’s 5G patents are the fundamental building blocks of the next generation of wireless technology and so no matter how much the U.S. tries, it cannot completely get rid of the company.
A recent report says that Huawei is asking Verizon for more than $1 billion in patent licensing fees for the use of around 320 networking equipment patents. Although Verizon is not using Huawei’s equipment, its suppliers rely on Huawei’s patents on the internet of things technology, networking gear, and wireline infrastructure. Verizon is the biggest smartphone carrier in the U.S. and the first telecom company in the country to roll out 5G networks. This makes it a lucrative target for Huawei.
The company is also in talks with Qualcomm over the value of parents and has also entered into a dispute with the defense contractor Harris Corp regarding infringement of networking and cloud security patents.
The U.S. has attacked Huawei from all the sides. Not only has the government decided not to use federal money for buying Huawei’s gear, but it has also ordered companies using American technology to not do business with the company. As a result, the Chinese tech giant’s smartphone business has suffered a major blow.
On top of that, the U.S. is also pressuring its European allies to not use Huawei’s 5G equipment. Experts believe that the Chinese manufacturer can retaliate by putting its patents to good use.
Tech companies are no stranger to patent disputes and Huawei is taking a leaf from the industry’s playbook. 5G is expected to revive the industry and since the payoffs are expected to be huge, there is a greater opportunity to earn via royalties and licensing fees.
Huawei expects its revenue to take a hit because of the U.S. sanctions and now that the company is going down, it has nothing to lose by going after American companies. What’s interesting to note is that in addition to accusing Huawei of espionage, the U.S. also claims that it steal intellectual property so now it will be interesting to see how it responds to the Chinese company’s demand for royalties.