Although some 2G royalties are expiring, the growing base of 3G handsets and acceleration of LTE handsets - with combined, but not quite additive, royalties for 2G, 3G, and 4G patents - will keep total mobile wireless royalties growing. Over the last several years, annual handset shipments have gone from hundreds of millions to more than a billion, while the market has shifted toward 3G handsets.
Among other companies, Motorola has been in a good position in recent years with strong patent portfolios for GSM and WCDMA, but that power will shift over the next five years to those with strong 4G positions, including Samsung and Panasonic. "Samsung?s strength in LTE patents will suit it well as one of the strongest LTE handset vendors," says Solis. "Companies like Ericsson, Nokia, InterDigital, and Qualcomm will retain their patent position as the market shifts."
The participation of Chinese companies in patent filing and participation in standardization is also a notable trend. Huawei and ZTE, among other Chinese companies, are very cognizant of the importance of 4G patents. Chinese companies, as well Japanese and South Korean companies, will shift some of the patent power from Europe and the US to the Asia-Pacific.