China's mobile phone industry embraces international patent barriers

In response to the increasingly frequent patent litigation in the international market, the local mobile phone industry is brewing a "joint action."

On May 3, the reporter learned from multiple sources that an organization named “Mobile China Alliance” was quietly established in Shanghai in late April. “On the surface, this alliance is to promote the coordinated development of China's mobile phone industry. But in essence, it is to build a 'patent pool' in order to cope with the current international patent warfare.” Our reporter said.

The list of members obtained by the reporter shows that the current domestic first-line communication IC design companies, mobile phone solution companies, and mobile phone manufacturers basically cover them.

Mobile phone manufacturers include Lenovo, ZTE, Konka, TCL, Cool, Kivu and other first-line brands; mobile phone design companies include Longqi, Wentai, Huaqin and other large-scale solutions; chip manufacturers have Spreadtrum, RDA, Geke Micro And so on, a total of more than 30 homes.

"All companies with monthly shipments exceeding 1 million are basically the most powerful companies in the industry." One participant commented. It is worth mentioning that the largest chip company in the domestic shipments of MediaTek, and Shenzhen Huawei are not among the league.

“One of the important reasons for the establishment of the alliance is not unrelated to the frequent intellectual property lawsuits that China’s mobile phone manufacturers have encountered in the international market in recent years,” said the executives of the aforementioned coalition members.

In February of this year, Nokia sued Shanghai Huaqin Communication Technology Co., Ltd. (hereinafter referred to as “Hua Qin”) in Shanghai No. 1 Intermediate People's Court for allegedly infringing on its eight core invention patents and requested compensation of approximately RMB 90 million. The court has already accepted the case.

And Kew Wu, the largest mobile phone manufacturer in Shenzhen, has also been sued by Nokia in Hong Kong for alleged infringements in appearance and intellectual property. The 13 Kivu products were also seized in Hong Kong.

In early April, Ericsson, another international communications giant, sued ZTE’s mobile phone products for infringement of its GSM and CDMA partial patents in Europe, and requested the courts of the United Kingdom, Italy and Germany to ban the sales of ZTE’s mobile phones.

It is worth noting that the above-mentioned three local companies that have been litigated have all joined the "Mobile China Alliance."

“Foreign giants' patent battle against Chinese mobile phone manufacturers has become the norm, which makes local manufacturers very passive.” Sun Wenping, vice president of the Shenzhen Mobile Phone Industry Association, said in an interview earlier this week that the intensified patent battle will hinder the overseas expansion of local companies.

"If these companies go it alone, compared to foreign giants, its ability to fight in the patent field is weak." The aforementioned coalition executives admitted that the member companies in the alliance, despite considerable strength in the local, but in the patent war in the international market None of them are dominant. "Especially patents in the GSM field are basically monopolized by western countries, but this is the mainstream product of local manufacturers."

In this context, the establishment of the “Mobile China Alliance” hopes to respond to the increasingly intensified international patent warfare through the formation of a group. "The alliance member companies have more than 10,000 patents covering the field of communications technology. Based on this, they will build a 'patent pool' and take the form of equity sharing, which will increase the overall patent strength of the alliance members." A person in charge of the participating companies told reporters analysis.

However, according to our reporter from a number of coalition companies, even if the “cluster”, the patent strength of coalition companies is still weak. "A lot of them are peripheral patents, and the real core patents are limited." Another person in charge of the participating companies disclosed that from the current point of view, it is still difficult to overcome the foreign giants through the "patent pool."

“We can also realize the sharing of rights through the form of collective patent purchases.” The source told reporters. This is an expedient measure, but it can reduce the cost of individual companies to some extent.