Huawei banks on own patents to churn out 4G handsets at lower cost

Huawei would have a cost advantage of 15-20% owings the fact that it owns the patents for the technology

Huawei Technologies, one of the world’s top five smartphone makers, is banking on its huge ownership of patents to be among the top three smartphone companies in India by 2017.

It has a 5.3 per cent market share globally but less than one per cent of India’s estimated 80 million units a year handset market.

Till a few months earlier, Huawei was focused on the business to business segment. Direct consumer sales were limited. It started selling smartphones in India through the e-commerce platform earlier this year.

With its many patents for the technology, says Huawei, it can make fourth-generation (4G) handsets about 15-20 per cent cheaper than its rivals.

“Over the next year, we would be launching 10-15 handsets in India, at between Rs 6,000 and Rs 35,000. Of these, at least three would be 4G and run on the long-term evolution technology that Indian operators will use,” said P Sanjeev, director of device sales at Huawei India. “In 4G, the largest percentage of essential patents belongs to us."

As of end-June, Huawei had filed 65,000 patents. Its mobile devices division had filed 12,000 invention-related patents, beside 1,000 design patents, worldwide as of August.

Recently, Swedish multinational corporation Ericsson petitioned the high court here that Chinese smartphone giant Xiaomi had not been paying the licence fee for using its patented technologies. The court, in an interim order, restrained Xiaomi from selling handsets that operate on the technology patented by Ericsson in India.

Ericsson, which makes telecom equipment like Huawei, has filed lawsuits against other smartphone makers in India such as Micromax, Intex and Gionee, beside Samsung in the US, alleging violation of use of its mobile patents.

Sanjeev says Huawei has cross-licensing agreements with Ericsson, Qualcomm, Nokia, Nokia Siemens, WiLAN, Alcatel-Lucent and several other telecom technology makers. Cross-licensing allows a patent holder to use others’ patents in exchange for its own.