Qualcomm agrees Chinese patent licensing deal

Chip maker Qualcomm has agreed a patent licensing deal with Chinese technology company Guangdong Oppo Mobile Telecommunications.

Under the terms of the agreement, which is directed to 3G and 4G patents, Qualcomm has granted Oppo a licence to develop, manufacture and sell products that use the 3G WCDMA and CDMA2000 technologies, and the 4G LTE-TDD, TD-SCDMA and GSM technologies.

Oppo will need to pay Qualcomm a royalty rate to use the patented technology.

Although the royalty amount has not been revealed, Qualcomm said it will be consistent with the terms of a rectification plan that the company agreed to following an investigation into its licensing practices by China’s National Development and Reform Commission (NDRC).

In February last year, Qualcomm  agreed to pay a fine of nearly $1 billion to the NDRC as well as modify parts of its business practices in China.

Under that agreement, Qualcomm said it will offer separate licences to certain patents, with licensees whose phones use 4G technology paying a 3.5% royalty rate, and those whose handsets incorporate 3G paying 5%.

Instead of applying the royalty rate to the wholesale price of the handset, as it did previously, Qualcomm said at the time it would instead apply the rate to 65% of the net selling price of a device.

Adler Feng, director of intellectual property at Oppo, said: “This licence agreement will allow us to have access to the most advanced technologies in the mobile industry and enable us to craft elegant devices with extraordinary experience for the consumers.”

Alex Rogers, general manager at Qualcomm Technology Licensing, added: “We are excited to see companies such as Oppo build on our patented technologies to drive further development and innovation and create compelling products.”

Rogers added: “Oppo joins more than 100 other Chinese companies that have signed licence agreements with Qualcomm that are consistent with terms of the rectification plan.”