Post 16: Huaiwei & ZTE European Patent War

After nearly two years, the patent litigation case between Huawei and ZTE has the latest developments this week. German Mannheim District Court recently ruled against ZTE, saying its long-term evolution (LTE) 4G technology infringes on one of Huawei’s patents. The court also granted Huawei’s request for a ban on the sales of ZTE’s stations employing the LTE network in Germany. A representative from ZTE said the company would appeal against the ruling later. Florian Mueller, consultant of Microsoft and Oracle, mentioned that the lawsuit between Huawei and ZTE may have unprecedented impact on all standard-essential patent (SEP) enforcement in the European Union.

In April 2011, Huawei filed lawsuits against ZTE in Germany, France and Hungary, saying that ZTE infringe its patent and trademark rights. The patent involved in this litigations is “key derivation function” EP2273818, the basic patent of 4G LTE mobile communication standards.

It seems like the competition between Huawei and LTE is nor going to end soon. Behind the patent disputes, the competition heated on both sides. After viewing so many patent lawsuits, I think patent lawsuit have become an important weapon for international competition, it seems like no companies can avoid it. As China’s two largest telecommunications hardware makers, the fighting between Huawei and ZTE is expected to happen sooner or later because these tow companies are so similar on their products and services. LTE, a new technology, seems to be the focus of their competition. There is no doubt that LTE network will bring new opportunities to the global operations. It is believed that the market value of this new technology worth up to billions of dollars. The question is if a single company can take the big “cake”. Apparently the answer is no. In fact, Huawei and ZTE are two excellent telecommunication companies in China. As Chinese, I hope to see these two companies to corporate instead of fighting with each other. On the other hand, the patent war might not be totally a bad thing for those companies. The patent wars help to enhance the visibility of both companies at the international level. Thus, these international patent lawsuits are like extremely expensive advertisement for these two companies. However, is it worth to spend the huge amount of money on the ongoing patent lawsuit? Is it really good to be famous by doing so? I think those are good questions that worth companies to think about , not only for Huawei and ZTE, but also other companies.