For a $500 5G NR smartphone, Qualcomm could charge up to $16.25 for access to patented technologies
The 5G NR (New Radio) standard is crystallizing and is expected to be finalized with 3GPP Release 15 in mid-2018. The result of an industry-wide collaborative process, the specification will essentially define the technology that comprises 5G, from the ran to the core to the handset.
As with previous generations of mobile technology, Qualcomm effectively invented many core technological components that will go into the 5G NR spec. Among them are scalable OFDM-based air interface, a flexible slot-based framework, advanced channel coding, massive multiple-input, multiple-output (MIMO), and mobile millimeter wave.
In the run up to commercial availability of Release 15 compliant smartphones, which Qualcomm forecasts in 2019, the San Diego, Calif.-based company has published a statement of terms and conditions for licensing cellular-essential patents.
Per the licensing terms, OEM branded handsets will have an effective run rate of 2.275% of the selling price for single-mode handsets, and 3.25% of the selling price for multi-mode devices.
To give some hypothetical pricing, a patent licensing for a $100 multi-mode device would cost an OEM $3.25, while a $200 multi-mode device would cost the OEM $6.50. The company capped royalties at a $500 selling price, which equates to $16.25 for a multi-mode device.
According to a statement from the company, “Qualcomm will continue to offer licenses for OEM branded mobile handsets that include both Qualcomm’s cellular standard essential patents as well as those patents not essential to the standard, a total portfolio of over 130,000 patents and pending applications worldwide at royalty rates of 4% of the selling price for branded single-mode handsets and 5% of the selling price for branded multi-mode handsets.”
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