LG wants to make money on smartphone patents. South Korean company set up company for patent distribution.
After several years of struggling with big companies like LG, Samsung and Apple, LG gave up and shut down smartphone operations in April 2021. But LG’s smartphone operations may not be completely exhausted yet.
According to a report by The Elec, the South Korean tech giant is considering licensing some of its nearly 20,000 smartphone patents to other companies before it terminates the LG mobile brand. Among these patents are some prominent wireless technologies such as 5G.
LG wants to monetize its smartphone patents
Before LG shuts down its smartphone operations, he said this market had become “very competitive” and it would be better to use its energies in other areas. Considering that LG has been doing well since closing its loss-making mobile division, we can say that this move is the right one.
But LG’s cessation of smartphone operations also voided many patents that it could no longer use. The company, which holds nearly 20,000 patents on 4G, 5G, and other wireless technologies, costs about 20 billion won ($16 million) each year to maintain them.
The Elec, on the other hand, claimed that the company has formed a subsidiary that will handle licensing deals with various smartphone brands. LG may also sell some of these patents to rival companies. For example, a few months after LG left the smartphone market, Samsung reportedly followed LG’s 5G patent portfolio.
The distribution of smartphone patents obtained by LG will take place in different ways. Allegedly, LG wants to keep its 5G patents as long as possible because they are important. In fact, the company plans to use these patents to develop its own smart devices and Internet of Things (IoT) products.
What makes LG’s current decision to license/sell its patents interesting is that many companies, including automaker Volkswagen, have applied to LG to purchase these patents after it terminated its mobile operations. Let’s see if there will be new offers from companies like Volkswagen over time.