Is Meizu patent infringement still hit by Qualcomm?

Last week, Qualcomm submitted a complaint against Meizu to the Beijing Intellectual Property Court, requesting the court to rule that Qualcomm’s patent licensing conditions for Meizu were in compliance with the provisions of the Anti-Monopoly Law of the People’s Republic of China and the fair, reasonable and non-discriminatory responsibilities of Qualcomm. Licensing obligations and claims 520 million yuan.

This is also the first lawsuit filed by Qualcomm in China for mobile phone manufacturers. After the rectification of the National Development and Reform Commission, the relationship between Qualcomm and domestic mobile phone manufacturers seems to have become very harmonious, and a large number of manufacturers have signed new licensing agreements with Qualcomm.

Qualcomm is a patent giant that cannot be ignored in China's mobile phone market

According to Qualcomm's latest disclosure, more than 100 mobile phone manufacturers in China have signed licensing agreements with Qualcomm, including Huawei, ZTE, and Xiaomi, which have relatively large shipments in the mobile phone industry, and Gree, which has a slightly smaller shipment volume. 360 and so on.

OPPO, VIVO and Meizu are not on the list. In response to the sudden appeal of Meizu to the court, Qualcomm responded that Meizu continued to use Qualcomm's patents without relying on Qualcomm's patent license and refused to support patent fees.

Li Nan, vice president of Meizu, complained that he replied that Qualcomm’s patent negotiations were non-public, non-transparent and unfair, while Meizu was the only company in the country that did not rely on Qualcomm chips to become bigger and stronger, thus becoming the targeted target of American giant Qualcomm. .

Qualcomm: Invisible patent giant

Qualcomm proposed that the patent licensing agreement provided to Meizu is in line with China's Anti-Monopoly Law. According to Qualcomm's agreement, Qualcomm will charge 5% of 3G equipment (including multi-mode 3G/4G equipment) for non-executing CDMA or WCDMA networks for the authorization of 3G and 4G necessary Chinese patents for branded equipment sold in China. The agreed 4G equipment (including the 3-mode LTE-TDD equipment) charges a 3.5% royalty fee; each patent fee is based on 65% of the net sales price of the equipment.

For example, a 2,000-yuan mobile phone needs to pay a royalty of 2,000 yuan x 65% x 5% = 65 yuan, which is a cost burden for a large number of mobile phone manufacturers who are losing money. According to Qualcomm's financial data, China is the largest market for Qualcomm. In the last fiscal year, it contributed 53% of its revenue to Qualcomm, totaling US$25.28 billion, a large part of which came from patent fees.

For mobile phone terminal manufacturers, 5% of the royalty includes chip licensing fees, manufacturing costs and dozens of freely shared patents (3G and 4G are one of them). Losing the Qualcomm processor means losing Shared rights.

As the upstream giant of the communications industry, Qualcomm has not only benefited from selling chips, but Qualcomm has also accumulated many patents for basic scientific research in the field of mobile communications. Simply put, Qualcomm provides an algorithm for basic codec, which is the basis of wireless communication.

Therefore, even if Meizu's terminal products do not use Qualcomm chips, it will inevitably use the standard essential patents that Qualcomm covers in mobile terminals in 3G and 4G wireless communications.

Most of the Meizu used in the early years was the Samsung mobile phone chip. In recent years, MediaTek chips have been widely used after increasing shipments. Before. MediaTek has reached a cross-licensing agreement with Qualcomm. MediaTek has obtained Qualcomm's license for free, but according to the agreement, MediaTek's ODM, OEM and other partners will pay Qualcomm's licensing fees, and MediaTek partners must have Qualcomm's authorization. Therefore, even mobile terminal operators using MediaTek chips need to pay Qualcomm.

The dispute over the patent dispute between Meizu and Qualcomm is also here. Meizu and Qualcomm did not reach a consensus on the use of patents, but still used Qualcomm's patented communication technology.

The Meizu response said that Meizu had already had substantive negotiations with Qualcomm, but Qualcomm’s negotiation standards were very unfair. "Qualcomm has given you a black box, and you must accept it. The terms in the box are not open and opaque, and there is no guarantee that the market will be fair and just, so it is difficult for us to simply accept Qualcomm's unilateral conditions," Li Nan said.

In response to the ignorance of Qualcomm's prior payment of patent fees, Li Nan said that according to Chinese law, Qualcomm's patents can be used for renegotiation first, and Qualcomm mentioned in the lawsuit that "Meizu has not been sincerely and has reached an agreement with Qualcomm. Instead, they have adopted a procrastination approach, hoping to delay indefinitely so that they can use Qualcomm patents without charge."

In addition, Li Nan also revealed to the 36-year-old reporter that regarding the black box issue, although Qualcomm has a public standard agreement but there is a secret agreement outside, Meizu is because it is unwilling to accept unfair agreements, resulting in negotiations. problem.

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