The recent publication of the 5G standard specification has changed the game in terms of communication technology, with the Internet of Things (IoT) looking likely to become a reality (for further information please see “Who will be the technology leader for 5G? Part one”). Part two of this report presents an analysis of the available 5G-related SEP data and the big names behind the 5G patent portfolios.

While the implementation and licensing of LTE SEPs mainly concerned the communications industry, the 5G New Radio specification will enable such connectivity in the whole physical world through the IoT. In future, any manufacturing sector will thus have to license SEPs under the 5G FRAND regime. The target market for licensing SEPs will thus drastically increase and large 5G SEP holders will be able to extend their licensing programmes to various industries. For example, the automotive industry could be one of the first sectors to rely on 5G, connecting vehicles to other vehicles, roadsides, traffic lights, buildings and the Internet to process data in the cloud.

Who owns the 5G SEPs? SEPs play an important role in standardisation, as they provide incentives for companies to develop technologies for standards and to contribute to standardisation, which involves costly private investment for public benefit. Further, patent holders will have an interest in improving existing standards if they can recoup the costs through SEP royalty fees; successful 3G and 4G licensing programmes have proven that SEP royalties are highly lucrative. Moreover, various SEP-related litigation cases indicate that SEP ownership controls how mobile technologies are used.

In recent years, the number of 5G-related SEPs has increased sharply. However, only a few companies have declared that they own such patents and Nokia, Qualcomm and ZTE are among those which are yet to do so.

Table 1: SEP declarations for 5G 

Declaring company

Patent count

Family count

Family share

Ericsson

5,843

591

31.29%

Intel

740

428

22.66%

Sharp

612

328

17.36%

Samsung

567

298

15.78%

Huawei

634

150

7.94%

LG Electronics

58

48

2.54%

Idac Holdings

29

21

1.11%

InterDigital

691

18

0.95%

BlackBerry

11

4

0.21%

Electronics And Telecommunication Research Institute (ETRI)

2

2

0.11%

Optis Wireless Technology

17

1

0.05%

Texas Instruments Inc

1

1

0.05%

While SEP declaration data is a valuable source for understanding SEP ownership, it is limited by self-declaration. To the best of its knowledge, a company must evaluate whether its patents' claims read on a 5G standard specification. Therefore, it is often suggested that companies tend to overestimate and thus over-declare the number of essential patents that they own. As Table 1 shows, many companies also delay their declarations and, in the case of 5G, there are SEP declarations missing. Due to these shortcomings, IPlytics has developed an approach to estimate the actual number of SEPs, which uses data connected to a company’s standard setting activities (eg, technical contributions and meeting attendance), TDoc and standard specifications documents and declared SEPs. For example, IPlytics searches the worldwide patent files of standard setting companies and identifies whether:

  • the patents were filed in similar international patent specifications (IPC) or cooperative patent classifications (CPC) as the declared SEPs;  
  • the patents were cited by declared SEPs (not including self-citations);
  • the inventor of these patents participated at the respective 5G Radio Access Network (RAN) meetings (comparing a person’s name and affiliation);
  • the earliest priority date matches the respective 5G RAN meetings;
  • the applicant or assignee submitted a technical proposal for the 5G standard; and
  • the claim has a high textual similarity with the respective TDoc and standard specifications documents (making use of a Latent Semantic Indexing model).

To measure the accurate combination of the above, the method uses a multivariate data analysis model (ie, a statistical technique to analyse data from more than one source). Each characteristic is weighted by a computer programme to provide the best possible fit for the probability of patent essentiality. The model was tested using verified SEP data and correctly predicted which patents out of a random sample had a high likelihood of being standard-essential.

Table 2: Estimated 5G patent portfolios 

Applicant/assignee

5G SEP family share

Market coverage

Citation relevance

Qualcomm

8.6%

1.43

0.74

Huawei

7.92%

1.43

0.56

LG Electronics

7.38%

1.34

2.63

Ericsson

6.74%

1.23

0.66

Samsung

5.77%

1.31

0.95

ZTE

4.1%

1.45

0.62

Nokia

3.48%

1.23

1.43

Intel

3.04%

1.52

0.66

NTT DOCOMO

2.61%

1.46

0.93

Alcatel-Lucent (acquired by Nokia)

2.06%

1.28

1.57

NEC

1.91%

1.39

0.72

Sony Corporation

1.75%

1.47

1.39

ETRI

1.7%

0.98

0.79

Sharp

1.69%

1.43

0.9

Panasonic

1.47%

1.46

1.14

BlackBerry Limited

1.29%

1.21

1.37

Apple

1.12%

1.24

0.96

InterDigital

1.08%

1.61

2.43

MediaTek

0.79%

1.31

1.21

Motorola

0.71%

1.28

0.99

Table 2 lists the top 20 patent portfolio shares of 5G SEP owners, estimating that Qualcomm, Huawei, LG Electronics, Ericsson and Samsung own the largest 5G SEP portfolios. In comparison to the technical contribution and the meeting attendance data (see part one), companies such as Alcatel-Lucent, Sharp, Panasonic, BlackBerry, Apple and InterDigital appear in the top 20 patent owners, despite not being among the strongest standards contributors.

The market coverage indicator estimates the patent family size by counting each country of a patent family divided by the country’s gross domestic product. The count is normalised and compared to industry averages (using IPC or CPC, year and country). Table 2 shows that most 5G patent portfolios have extensive international coverage (a score higher than one is above average), with only ETRI showing a more localised portfolio.

The citation relevance indicator counts the normalised number of received patent citations (not counting self-citations). LG Electronics, InterDigital, Alcatel-Lucent and Nokia scored highest, indicating that they own valuable patent portfolios.

The data provides a first glimpse of the 5G patent landscape. It will be exciting to monitor which company will become the strongest IP owner for 5G essential technologies over the coming years.

Action plan Since the licensing of SEPs looks set to become a major issue, not only for the handset industry but also for any manufacturing sector, senior managers and directors of any industry where connectivity matters should bear in mind the following key considerations:

  • Future technologies that enable connectivity will increasingly rely on patented technology standards such as 5G.
  • The number of 5G SEPs is constantly rising – IP directors should consider royalty costs and appropriate security payments in advance.
  • IP directors should not only consider information retrieved from patent data, but also monitor and consider standardisation data.
  • Senior managers should bear in mind the dynamic market of SEPs, where patent assertion entities often acquire SEP portfolios to assert extensive royalty payments.
  • Manufacturers should pursue a common strategy for patenting and standardisation to ensure that they are fully engaged in developing future connectivity technologies.