Patents can allow you to make profits to reward your innovation, but they can also give you the ability to leverage your position.
Huawei announced it will charge up to $2.50 in royalties for each smartphone using network patents that it controls, coming in lower than many other players in the area. Making your patents more appealing with lower fees can be an effective strategy for long-term market gain.
The company isn’t alone in profiting from their patents, with other large tech providers such as Ericsson committing to up to $5 per device, while Qualcomm has topped out at $7.50 in the past. And when this strategy looks effective for a global provider, your portfolio could work for you in a similar way.
Huawei undercutting charges for their advancements with new 5G technology could become a lucrative pivot from smartphone manufacturing. Their patents already brought in over $1.2 billion between 2019 and 2021, and they seem intent on growing that number further.
Though the company won’t be netting as much as its competitors, they have said they will use the royalties that do come in to reinvest in research and development to stay competitive against the likes of Ericsson and Nokia. A common and effective strategy that could be employed when you’re holding on to valuable patents.
Protecting your products and processes can open the door to profiting and investing more in your business, but the patents can fit into many plans that may not pay off right away. This is why it’s so important to understand what your patent can do for you.