In the mobile Internet era, as a "sideline" mobile phone business, Huawei has become the business that contributes the most revenue, accounting for more than half. This is all because Huawei's mobile phone sales have increased year by year, and it once surpassed Samsung to become the world's number one. .
After entering the 5G era, Huawei is making rapid progress, investing hundreds of billions in R&D funds every year. With its 5G advantages, Huawei has successfully defeated Apple and become the most popular high-end mobile phone brand in China. In the domestic mobile phone market, the share of mobile phones once exceeded 50%. However, what I didn't expect was that just as Huawei was developing rapidly, the United States suddenly changed its rules. As a result, Huawei suffered a huge blow in its mobile phone business and had to sell Honor brand mobile phones, shrink its front lines, and change its strategic direction.
We all know that the United States is actually changing the rules because it is afraid of Huawei’s leading position in 5G technology and suppresses mobile phones. It is purely to cut off Huawei’s cash flow and make Huawei “stretched” in R&D investment. Further crackdown on Chinese high-tech enterprises.
In the 3G and 4G era, China was basically blank in terms of patented technology. Qualcomm and other foreign technology companies have mastered a large number of 3/4G network patents, and they use these patents to charge smartphone manufacturers high prices. With the amount of patent fees, Qualcomm's annual patent revenue reaches more than 50% of the total revenue, which can be said to be "earning money".
In the 5G era, this situation of foreign monopoly will change. Guo Fulin, President of Huawei's International Media Affairs, said that as of the end of 2020, Huawei had more than 100,000 patents around the world, more than 90 of which were invention patents. In terms of the number of 5G patents, Huawei ranks first in the world and is far ahead in quantity. So much so that Huawei cannot be bypassed in the formulation of 5G network standards. This is something they cannot tolerate and are afraid of.
With the mobile phone business being hit hard, Huawei began to change its thinking and focus on developing Hongmeng OS and HMS services to obtain revenue and profits through ecological services. In April this year, the Hongmeng system will be available to ordinary consumers. Another way is to learn from Qualcomm and collect patent royalties from smartphone manufacturers.
Now Huawei has officially waved the 5G patent stick. Ding Jianxin, director of Huawei's Intellectual Property Department, said at the "Innovation and Intellectual Property White Paper 2020" conference that Huawei will start charging royalties for 5G patents in 2021. , the charge is capped at $2.50 per mobile phone.
According to data, global smartphone shipments in 2020 were 1.24 billion units, and 5G mobile phone sales have increased significantly. In 2019, global shipments were only 20 million units, reaching 300 million units in 2020. With the advent of the 5G era, 5G mobile phone shipments will increase significantly and even replace 3G and 4G mobile phones.
If calculated based on the patent fee of US$2.5 per unit, the annual patent revenue is as high as US$3 billion, equivalent to more than 20 billion yuan. As major mobile phone manufacturers, Samsung and Apple contribute almost half of patent revenue. Apple, in particular, has not yet been able to develop its own 5G baseband.
Of course, behind success is huge investment and long-term persistence. In 2020, Huawei had more than 100,000 people engaged in research and development, accounting for 53% of the total. In 2019, R&D expenditures were 132.699 billion yuan, ranking first in the country in R&D investment and third in the world. The cumulative investment in research and development expenses in the past ten years has exceeded 600 billion yuan.