Huawei Sign Patent Licensing Deals to Diversify Revenue

After US sanctions disrupted the once-profitable smartphone market, Huawei is reportedly doubling down on monetizing its patents through licensing agreements with foreign businesses as it searches for other revenue sources.

The South China Morning Post reports that Nokia, a rival company from Finland, received an extension on a patent licensing agreement with Huawei on Friday.

Huawei intensifies its licensing agreements

• With businesses from a range of industries, including smartphones, cars, and telecoms.
• Huawei has inked more than 20 new patent licensing agreements or extended agreements.
• Through these agreements, Huawei will be able to collect royalties that it will use to pay for its R&D activities.
• The business is “delighted” to see its technology used to help the digitization of the automobile and other industries,
• according to Alan Fan, head of Huawei’s intellectual property division.
• This information is encouraging for Huawei as it continues to negotiate the complicated and dynamic technological environment.
• In May 2019, the US Commerce Department included Huawei Technologies Co Ltd and 70 affiliates in its so-called “Entity List,”
• Effectively forbidding the telecom giant from making purchases from US businesses without first receiving permission from the US government.
• The decision would make it difficult, if not impossible, for Huawei, the largest provider of telecom equipment in the world.
• To sell some products because it relied on US suppliers, according to US officials, who spoke to Reuters.
• U.S. officials told Reuters the decision would make it difficult, if not impossible, for Huawei, the world’s largest telecoms equipment provider, to sell some goods because it relied on US suppliers.
• The Chinese IT behemoth has already investigated alternative revenue streams after being placed on the aforementioned blacklist. Focusing on license agreements is one of these strategies.
• Compared to the prior year, Huawei announced overall revenue of US$100 billion for 2021, a 29% decline.
• Sales from its consumer sector, which includes smartphones, plunged 50% to US$33.5 billion.

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Significant Licensing Deals:

In the auto sector, Huawei has royalty agreements in place with 15 automakers worldwide, including Audi, Mercedes-Benz, and BMW.

The licensing agreements for car tech patents, according to NikkeiAsia, were completed in the second half of 2022.

As a result, 15 million of the 70 million cars made each year throughout the world will feature licensed Huawei smart car technology.

Huawei is making money off its patent and R&D skills in the face of US sanctions and reinvesting the earnings back into research.

Huawei can work with both domestic and international players thanks to the intellectual licensing agreements for a better income choice.

Huawei and Oppo have an agreement to share vital technical patents with Samsung.

20 companies from around the world, including producers of smart cars, smartphones, network equipment, and more, worked with Huawei.

Data from the company shows that Huawei submitted a record-breaking 6952 patents in 2017.

The EU Patent Office alone received 3500 patent applications.

The IT company had more than 110,000 active patents worldwide by the end of 2021.