Bloomberg: Huawei Bets Big on European 5G Patents Despite Trump’s Pressure

5G, artificial intelligence are biggest growth areas

Mate Xs Foldable Phone
Mate Xs Foldable Phone

Even as the Trump administration pressures European countries to stop using Huawei Technologies Co. gear, the Chinese telecommunications giant is increasing its footprint there, filing more patent applications in Europe than any other company last year.

By Susan Decker

Huawei filed 3,524 patent applications, far more than the 2,858 applications filed by No. 2 Samsung Electronics Co., according to a report by the European Patent Office. Two thirds of Huawei’s applications were in the field of digital communications, which includes the next generation of wireless communications known as 5G.

European officials have thus far largely defied U.S. insistence they exclude China’s biggest maker of telecommunications gear from new 5G networks, but not without continuing controversy. On Tuesday, U.K. Conservative Party rebels fired a warning shot by giving Prime Minister Boris Johnson only a slight win over his plan to allow Huawei to supply equipment for the country’s 5G networks.

Officials from President Donald Trump’s administration have urged Johnson and other European allies to stop doing business with Huawei over claims the company is an arm of the Chinese Communist Party and its involvement in 5G could enable spying.

Huawei has always denied these allegations.

U.S. efforts at blacklisting Huawei haven’t stopped the company from growing its business. While there’s no guarantee all of Huawei’s applications in Europe will become patents, the company’s actions make clear that it will be paid, at least through patent royalties, no matter what the politicians decide.

“It shows that Huawei is investing a lot in terms of innovation,” said Luis Berenguer, a spokesman for the European Patent Office.

Huawei is by far the largest filer of digital communications patents, requesting almost the same amount as Ericsson AB’s 1,227 applications and Qualcomm Inc.’s 1,061 applications combined.

The European Patent Office saw a 4% jump in applications last year, driven in large part by double-digit jumps in the fields of digital communications and computer technologies, which includes artificial intelligence.

U.S., Chinese and European companies each contributed about a quarter of all applications in digital communications.

American companies, led by Alphabet Inc., and Microsoft Corp., accounted for 38% of applications in the computer technology field. Samsung, Huawei and Intel Corp. rounded out the top five applicants in that field.

While American companies have filed a quarter of all applications, applications by Chinese firms have risen nearly six-fold since 2010. In addition to computer technology, American companies were strongest in the fields of medical technology and pharmaceuticals. The numbers reinforce other studies that indicate Chinese inventors are eroding American dominance in high tech fields.

Companies file patent applications in the regions they expect to sell products and gain profit, and do a bit of forum shopping based on the rules of different patent offices.

That’s why International Business Machines Corp., traditionally the biggest patent recipient in the U.S., isn’t even in the top 50 applicants in Europe.

Manufacturing conglomerate United Technologies Corp. is the top American filer in Europe, followed by Qualcomm and General Electric Co.

By Susan Decker With assistance by Todd Shields