Huawei and Qualcomm have signed a multi-year agreement regarding the use of each other’s patents. The agreement covers areas including 5G, AI, computing, and network technology. Qualcomm will also acquire a number of Huawei’s U.S. patents.
The agreement grants both companies access to parts of each other’s patent portfolios. It is the first licensing deal between Huawei and Qualcomm to include 5G technology. The companies say they are adhering to the FRAND principles, which require licenses for standard-essential patents to be available on fair, reasonable, and non-discriminatory terms.
In addition to the cross-licenses, Huawei is selling several U.S. patents to Qualcomm. These relate to areas such as AI, computing, and network technology. Financial details of that transaction have not been disclosed. The sale is still subject to approval by the relevant regulatory authorities.
Huawei expects the total value of its patent licensing agreements to exceed $6.9 billion once the deal is finalized, Reuters reports. Since 2021, the Chinese company has been making a net profit from licensing intellectual property.
This is partly because Huawei has invested substantial amounts in research and development over the years. The importance of proprietary technology and patents increased further after U.S. trade restrictions, beginning in 2019, limited Huawei’s access to advanced chips and certain software.
The relationship between Huawei and Qualcomm in patents goes back much further. Huawei first paid licensing fees to Qualcomm in 2001. Ten years later, the Chinese company received its first revenue from a patent license, then from Motorola.
More deals involving Huawei patents
The agreement with Qualcomm is part of a broader strategy in which Huawei is commercially leveraging its extensive patent portfolio. In August, the company signed another multi-year agreement with HP to use Wi-Fi patents.
Huawei itself primarily highlights its contributions to mobile standards such as 4G and 5G. Qualcomm, for its part, emphasizes that the new agreement signifies recognition of its own 5G technology and its licensing program for standard-essential patents.
The agreement is notable because two companies on opposite sides of the technological tensions between the United States and China are continuing to explicitly intertwine their intellectual property.