Soon, Almost Every Mobile Phone Will “Have” to Pay Huawei Royalties

China’s largest tech giant almost doubled its R&D budget over the past half-decade to $22.1 billion in 2021 — more than any company in the world outside America. Bloomberg

2021 R& D (billions) from Bloomberg

Huawei is the driving force behind Sisvel’s Wi-Fi 6 patent pool and will collect a significant % of the 50-60 cents Sisvel is demanding from every phone, Wi-Fi router, etc. That could easily amount to over $100 mi;llion per year. It will be hard to circumvent Sisvel, which also includes Phillips and Mediatek.

Florian Mueller, a patent expert I respect, notes, “Huawei owns one of the two most important WiFi 6 SEP portfolios. The only other patent holder to have a similar position is Qualcomm.” There is no doubt that Sisvel and Huawei are entitled to a reasonable royalty in the current legal system.

The US can’t apply it’s Huawei blockade to this without busting the international patent system, which brings $hundreds of billions to the US and allies.

Mueller adds that Sisvel offers an ingenious “Licensing Incentive Framework for Technologies (LIFT) to encourage companies to take a license early. Normally, refusing to pay royalties works out well for companies that choose to fight and go to court. The ultimate settlement rarely is more than what would have been owed and often is less.

LIFT changes the incentive by giving an enormous discount in the early years if you sign a license agreement quickly.

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