Huawei licenses 5G patents to rival as U.S. sanctions force the Chinese giant to seek new revenue - CNBC

Chinese exertion elephantine Huawei said Friday it volition licence its 5G exertion to rival handset shaper Oppo arsenic it looks to unlock a caller gross watercourse aft its smartphone concern was crushed by U.S. sanctions.

Huawei and Oppo, the 4th largest smartphone shaper successful the world, signed a "global patent cross-licensing agreement, which covers cellular modular indispensable patents, including 5G."

Huawei has a monolithic portfolio of implicit 100,000 patents globally. It is 1 of the apical patent holders successful 5G technology, which is next-generation ultra-fast mobile net seen arsenic cardinal to underpinning aboriginal industries specified arsenic artificial quality and autonomous cars.

When a caller procreation of cellular exertion is being developed, alleged planetary standards request to beryllium created. These are protocols, method specifications and plan that let interoperability between 5G networks globally and allows smartphones to pass with these networks.

Industry bodies are tasked with creating these and companies similar Huawei volition lend to their creation. These companies devise technologies which they past patent. The patents, which are captious to the standards of accidental 4G oregon 5G, volition beryllium deemed a "standard indispensable patent" oregon SEP.

Huawei has not been assertive successful monetizing these patents historically versus immoderate of its rivals similar Nokia and Ericsson.

However, successful 2019, the U.S. utilized a number of measures including a export blacklist to chopped Huawei disconnected from the critical semiconductors it needed for its smartphones and immoderate different products. This crushed the company's smartphone business which was erstwhile fig 1 successful the satellite astatine the time.

Last year, the Chinese tech elephantine indicated that it would statesman to start selling its exertion to different companies via patents.

The institution antecedently stated that it expected to gain gross of $1.2 cardinal to $1.3 cardinal from licensing its intelligence spot betwixt 2019 to 2021. Huawei said that it met its intelligence spot gross expectations for 2021, but did not supply a figure.

5G has go a contentious part of the broader exertion conflict betwixt the U.S. and China. Both nations presumption it arsenic a captious technology. But the U.S. has expressed concerns that Huawei represents a nationalist information menace and has pressured different nations to prohibition the Chinese steadfast from their 5G infrastructure. Huawei has repeatedly denied that it represents a nationalist information threat.