LTE's clouded IPR pool expected to be clearer than 3G

A wider distribution of intellectual property rights for LTE could provide the new technology with an easier path to market than that witnessed by 3G technologies.
In a report from Informa Telecoms & Media, the firm noted that a number of companies that played a large part in 3G IPR are also involved in LTE IPR, including Qualcomm Inc., Nokia Corp. and Ericsson. Companies also holding significant LTE IPR include Interdigital Inc., Samsung Electronics Co. Ltd., LG Electronics Co. Ltd. and Huawei Technologies Co. Ltd.
“Using data from the ETSI, USPTO, and EPO databases, we analysed the distribution of LTE patent wealth by company and by region” said Malik Kamal Saadi, principal analyst at Informa Telecoms & Media. “While Interdigital and Qualcomm are clear leaders in the global LTE patents portfolio with 21% and 19% market shares respectively of the total number of patents, Huawei comes in third position with 9%, Samsung in fourth with 8%, and Nokia, LG, and Ericsson in joint fifth place, each with 7% market share.”
Informa added that while a number of companies own LTE patents, the value of those patents is up for debate. The firm explained that an “essential” LTE patent “is a key invention or process required for implementing” LTE as defined by the 3GPP and that up to this point only about one-third were considered essential, though about 60% have the potential to become essential in the future.
The question of whether a patent is essential is highlighted by Huawei’s patent portfolio, which Informa said contains 182 LTE patents, though 178 of those are registered in China with only a handful of those considered essential.
“This means that Huawei’s IPR wealth will be effective in China but to a certain extent less effective in the rest of the world unless Huawei validates its patents with other recognized trademark and patent offices such as the European EPO or the American USPTO,” Informa noted.
Companies in a better LTE position with essential patents include Qualcomm and Nokia, which according to Informa both count more than 60% of their patents as essential, LG with 50% of its patents considered essential, Samsung with 40% of its patents considered essential and Ericsson with about one-third of its patents considered essential for LTE.
“Overall there is no doubt that a more widely distributed LTE IPR wealth is likely to help the whole industry, as it will reduce costs related to technology licensing and royalty fees,” concluded Kamal Saadi.
A number of companies announced in 2008 plans to work on a framework to establish fair licensing fees associated with LTE.