Industry giants agree on LTE IPR : Qualcomm notably absent from list

The market for LTE technology took another step forward today as seven infrastructure heavyweights announced a framework for licensing the rights to the next-generation wireless standard.
Alcatel-Lucent, L.M. Ericsson, NEC Corp., NextWave Wireless Inc., Nokia Corp., Nokia Siemens Networks and Sony Ericsson Mobile Communications all signed on to a press release stating a “mutual commitment to a framework for establishing predictable and more transparent maximum aggregate costs for licensing intellectual property rights that relate to 3GPP Long Term Evolution and Service Architecture evolution standards.”
The parties said the framework is based on fair, reasonable and non-discriminatory (FRAND) licensing terms. The companies noted they support a maximum aggregate royalty level for essential IPR in handsets as a single-digit percentage of the sales price. For notebooks that might integrate LTE modems, the companies agreed to a single-digit dollar amount as the maximum royalty level.
IPR licensing has long been a tricky subject in wireless. Indeed, former mobile-phone maker Sendo blamed excessive licensing costs as a reason for its demise. Those in the industry agree that IPR licensing can be difficult — there is no central licensing agency, so new market entrants must negotiate IPR licensing deal with each license holder individually. However, most wireless IPR license holders generally offer their holdings under FRAND terms.
Major players in the wireless industry — those holding IPR essential to standards such as W-CDMA or WiMAX — often score access to others’ IPR through cross-licensing deals. However, such quid pro quo agreements sometimes go sour, as is the case between Qualcomm Inc. and Nokia.
Today’s IPR framework announcement for LTE is notable also for those companies that have not signed on. Qualcomm, along with a number of other players, was not listed as a supporter.
Interestingly, Nokia attempted a similar effort several years ago. The company in 2002 urged the industry to adopt a 5% cap on all W-CDMA IPR costs. That effort failed, however.
While not expected to hit the market for several years, LTE received recent support as both AT&T Mobility and Verizon Wireless announced they plan to use the technology in their recently acquired 700 MHz spectrum to deploy next-generation services.
The fight over IPR has also touched the WiMAX market which analysts have noted is more disperse than the ownership of 3G IPR.