Huawei will bet on technology licensing to make money after suffering from United States sanctions. According to Bloomberg, the Chinese company will offer its 5G technologies to companies like Apple and Samsung for a “reasonable fee” and which promises to be lower than the royalties charged by competitors like Qualcomm.
According to Song Liuping, head of Huawei’s legal sector, in addition to licensing for future devices, the company plans to charge a fee from Apple and Samsung that would include devices launched between 2019 and 2021. With the deal, Huawei expects to raise up to US $ 1.3 billion in fees.
Bloomberg spoke to Jason Ding, who runs Huawei’s intellectual property business, and the executive revealed that the company plans to charge royalties of $ 2.50 for handsets sold with the brand’s technologies. The amount is considerably lower than the fees charged by Qualcomm, which works with royalties at around US $ 7.50 per device.
Huawei’s goal is to license its technology to companies that can operate in the United States. Currently, Huawei is not allowed to invest in 5G infrastructure in the country, but the company can “lend” its patents to other firms.
In addition to technologies aimed at 5G, the company also has patents aimed at sectors such as internet of things and autonomous cars. By offering values more attractive than the competition, the company can gain space in the connectivity market in the United States.
It is important to note, however, that Apple and Samsung may not be willing to pay the company $ 1.3 billion in fees for the company, which could lead to a major legal battle. In the past, Apple faced Qualcomm in court for the same reason for years, but the chip maker ended up getting the better of it in the end.