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ZTE & Huawei in IPR Charm Offensive

The Chinese vendors hike their intellectual property investments and ask everyone to play nice with patents

March 14, 2013

2 Min Read
ZTE & Huawei in IPR Charm Offensive

If recent announcements from ZTE Corp. and Huawei Technologies Co. Ltd. are anything to go by, we should be prepared for an IPR (intellectual property rights) charm offensive in 2013. ZTE announced Thursday that it increased its R&D investments by 3 percent year-on-year in 2012 to 9 billion yuan renminbi (US$1.45 billion), despite "challenges in the global economy" (which, as previously noted, had an impact on its margins -- see ZTE Expects 2012 Loss.)The vendor also boasted a hike in its patent applications to 1,184 in 2012: It expects "a large number of our patent applications in Europe will be granted in the next two to three years," which in turn will "reduce risks of anti-competitive litigations." More specifically, it "expects a large number of the company’s patents, mainly on LTE technology and smart terminals, will be granted in Europe in 2014. The addition of these high-quality patents will generate very significant competitive and commercial advantages for ZTE against competitors in the European market."The company also remarked on the cross-licensing agreements it has with multiple companies, including Ericsson AB and Qualcomm Inc., and advocated "an open and win-win model based on sharing."For the full details of ZTE's announcement, see this press release. ZTE's announcement follows only days after Huawei bigged up its own investments and IPR activities, noting that it pays about $300 million a year in royalties and invested $4.8 billion in R&D in 2012, about 13.5 percent of its full-year revenues. (See Huawei Expects 10%+ Growth in 2013.) Huawei states: "Since its early years, Huawei has proactively advocated for strong IPR protection … We oppose IPR monopolies as they create competition barriers among enterprises, which in turn hold back continued innovation across the industry … We urgently need to strengthen IPR collaboration and protection, including paid use mechanisms, to reduce disputes and promote innovation and technological advancement."You can read Huawei's full statement here. So here's the thing: There will be a great many companies that agree with the sentiments of both Huawei and ZTE about more open access to intellectual property and for more reasonable and easy compensation -- only lawyers benefit from the patent wars that have dogged the mobile sector during the past few years.But how many companies will be charmed by the duo's proclamations?Answers on a digital postcard, please…— Ray Le Maistre, International Managing Editor, Light Reading

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