Licensing rate capped at €3 per 5G NR device
Standardized telecommunications technologies are developed collaboratively, through bodies like the 3GPP, based on the input of stakeholders from the industry. As technology and standards develop in tandem, contributions from individual companies is often incorporated into the final standard, meaning one company owns the intellectual property needed by all the other companies to deliver, in this case 5G NR compatible equipment.
With 5G NR devices set to hit the market next year, and supporting networks under construction around the world today, Nokia this week detailed the expected licensure rate for standard essential patents that the infrastructure vendor controls. The company said it will cap fees at €3, $3.46 based on current exchange rates, per 5G NR device.
“Nokia innovation combined with our commitment to open standardization has helped build the networks of today and lay the foundations for 5G NR,” Ilkka Rahnasto, head of Patent Business at Nokia, said in a statement. “This announcement is an important step in helping companies plan for the introduction of 5G NR capable mobile phones, with the first commercial launches expected in 2019.”
Qualcomm is another major 5G NR patent holder, and the company derives significant income from licensing its standard essential patents. Last year the San Diego-based chipmaker laid out its fee structure.
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.
In a presentation with Verizon and Qualcomm, Motorola announced an upgradeable 5G phone, the moto z3. The device, as a standalone, is a gigabit LTE device, but with the addition of the clip-on 5G “mod,” the device will be able to receive millimeter wave transmissions.
As it relates to 5G NR, some of the major technological components developed by Qualcomm are the OFDM-based air interface, a flexible slot-based framework, advanced channel coding, massive multiple-input, multiple-output (MIMO), and mobile millimeter wave.