Qualcomm secured another boost for its patent licensing business in China this week with the announcement of a new deal licensing 3G and 4G technology to Chinese smartphone manufacturer vivo.
Under the terms of the agreement, Qualcomm has granted vivo a royalty-bearing patent license to “develop, manufacture and sell 3G WCDMA and CDMA2000 and 4G LTE (including “3-mode” GSM, TD-SCDMA and LTE-TDD) complete devices for use in China.”
Qualcomm, which was hit with a $975 million fine for alleged anti-monopoly violations in China last year, said the terms of the agreement meet the requirements laid out in its rectification plan with Chinese officials.
“Qualcomm is committed to the continued success of China’s wireless industry,” Qualcomm Technology Licensing senior vice president and general manager Alex Rogers said. “We are pleased to sign a new licensing agreement with vivo that builds on our long standing relationship. It is exciting to see our technology enabling many large Chinese mobile device manufacturers such as vivo to become successful global players.”
And Qualcomm has good reason to be excited about its deal with vivo as it looks to build up its licensing revenues and reputation in the wake of the Chinese fine.
Vivo is China’s third-largest smartphone manufacturer and fifth largest smartphone vendor globally, according to statistics from International Data Corporation. In the second quarter, the company shipped 16.4 million units for 4.8 percent of the market share, IDC said.
The agreement comes on the heels of a separate 3G and 4G licensing deal last week between Qualcomm and fellow major Chinese brand OPPO.
In the second quarter, OPPO was the second largest Chinese smartphone brand and fourth largest vendor worldwide with 22.6 million units shipped and 6.6 percent of the market share, according to IDC figures.
The deals will further strengthen Qualcomm’s business in China, which helped the company beat Wall Street expectations in its own second quarter earnings report.
At the time, Qualcomm CEO Steve Mollenkopf said the company was seeing “meaningful progress with licensees in China,” and Qualcomm president Derek Aberle said the company was following a “strong 4G ramp in China as each of the operators pursues aggressive subscribe growth targets with their 4G plus service offerings.”