An internal document signed by Huawei founder Ren Zhengfei recently shows that Huawei will officially collect patent fees from European and American companies, which is of great significance for Huawei to consolidate its technological leadership.
The first is that Huawei dares to formally propose to charge patent fees to many European and American companies, which means that it has enough confidence in the quality of its own patents, indicating that its legal team and technical personnel have deeply studied their own patents to ensure that these patents have originality and validity, and European and American companies cannot bypass its patents.
Secondly, Huawei needs to replenish blood, due to well-known reasons, once Huawei's largest source of business revenue mobile phone sales shrank by 80%, revenue fell by more than 200 billion, and it still insists on investing hundreds of billions of dollars every year to develop innovative technology, which requires obtaining enough funds to support technology research and development, and collecting patent fees can make up for the loss of mobile phone business to a certain extent.
According to statistics, Qualcomm's main source of profit is patent fee income, patent fees account for about one-third of its revenue, but it contributes the vast majority of profits, Huawei's profits from patent fees can support its huge R & D investment, which in turn helps to enhance its core technology advantages.
Again is to declare Huawei's strength, has always emphasized its own patent strength advantages, but previously due to business development needs, it is more through the patent cross-authorization way with European and American companies to share patents, and now with the shrinkage of Huawei's mobile phone business, Huawei no longer need to ensure the expansion of these businesses in overseas markets through patent cross-authorization, by charging patent fees to European and American companies, indicating that Huawei can compete with European and American companies in this way, highlighting that it has a strong enough strength.
According to statistics, Huawei has more than 100,000 patents, accumulating enough advantages in patents, and its business has shrunk in 2021, but its patent application volume is still far ahead, ranking first in PCT patent applications.
In terms of 5G core technology, Huawei has an absolute leading edge, its 5G core patents have more than 3,000, ranking first in the world; the authorized patents obtained in the United States rank fifth, it is worth noting that in 2021, in addition to the slight increase in the number of patents granted by Huawei in the United States, many companies in the TOP10 include IBM, TSMC, Intel, and Apple.
All this shows that Huawei's patent layout in the global market is quite perfect, and it has prepared for a long time to accumulate enough patent advantages to lay a solid foundation for it to obtain patent fees in these markets.
Of course, Huawei's patent fees will not be easy, after all, European and American companies have never been easy to comply, Qualcomm, Samsung and Apple have set off patent lawsuits for several years, through these long lawsuits to determine the validity of patents, Huawei also needs to go through this process, it can be expected that Huawei and their patent litigation is likely to be protracted.
For more than 20 years, Chinese companies have repeatedly been patented by European and American companies to obtain huge profits, the most well-known is that around 2000 the DVD industry was squeezed by the patent alliance established by European, American, Japanese and Korean companies, when the patent fees they jointly collected once exceeded the cost of DVDs, resulting in the rapid decline of China's DVD industry.
Now Huawei has begun to collect patent fees from European and American companies, representing the strength of Chinese companies, they are no longer as weak as they were, they have also begun to have enough patent strength, in turn to collect patent fees from European and American companies, which is a huge progress made in China.