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Is Huawei in its right to demand billions from US carriers for patents?

If you didn’t know that Verizon owns money to Huawei for patent licensing, you do now. Huawei has sent a letter to America’s largest carrier, requesting payment for more than 200 individual patents that it holds. The patents in question stem from base networking gear, through IoT technology, to wired connectivity, and representatives of the two company have reportedly been meeting in New York to discuss further actions on the request.

While Verizon is forbidden to use Huawei networking and other equipment due to the ongoing tech cold war between US and China, it may not able to avoid using Huawei’s intellectual property in its network rollouts, given that Huawei has a year or so lead in 5G before the competition, to say the least.

The head of Huawei’s intellectual property licensing department has reportedly sent a letter asking Verizon to resolve the issue, pricing the patents at over $1 billion.”We trust that you will see the benefit of taking a license to our patent portfolio,” the letter reads which sounds like something from a Better Call Saul episode and smells like a legal dispute may be brewing on the horizon. Indeed, a Verizon spokesman declined to comment on the report with the following:

The request could potentially put Verizon in a pickle, and may even be designed to do so. The US is accusing Huawei in intellectual property infringements, and the Chinese are trying to turn the table with this patent licensing request. If Verizon refuses to pay citing that the patents are not applicable, or the amount requested is beyond their value, China could use this as argument fodder in any subsequent trade negotiations or court hearings. 

This is why we wanted to ask you if you think that Huawei is in its right to demand patent licensing from Verizon and probably other US carriers, too, or could it be using its IP as a negotiation pawn in the larger trade conflict with the US, in a sort of “what goes around comes around” argument.

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