Smartphone Patent War 2012: Chinese Alliance vs International Brands

The battlefield of patents are more and more the place where competitors are vying for market share. China has become the world's largest market for smart phones in the third quarter of 2011, according to Strategy Analytics. Some Chinese smartphone makers, including Lenovo, ZTE, TCL, Coolpad and Konka joined forces to protect themselves against the rising number of claims of patent infringement by international smartphone manufacturers, such as Apple, Nokia and Microsoft, and to dominate China's domestic market.
Huawei has around 65,000 patents and also ZTE has a substantial number of patents for wireless communication technologies. According to Erica Yen and Steve Shen of Digitimes many Chinese smart phone makers develop localized interfaces and even operation systems, see here.

Chinese smartphone manufacturers also launch their products via China-based telecom carriers and social networking websites operators, via dual branding. HTC and Sony Ericsson grew rapidly because their Android models were popular in major cities of east and south China, according to Linda Sui of Strategy Analytics. If China Telecom will launch the CDMA iPhone 4S early next year, Ms Sui expects Apple's market share to peak. Globally Nokia is still number one, closely followed by Samsung and Apple.

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Patents in China: Quantity Obsessed Quality Challenged

Time for quality patents
Photo: Danny Friedmann

Now we are all following Ericsson sueing ZTE for patent infringement in Germany, UK and Italy, read here. Followed of course by ZTE trying to invalidate Ericsson's patent at China's Patent Re-examination Board, read here, because of an alleged lack of novelty, inventiveness or usefulness. In other words: lack of quality.

Wan Gang 万钢 minister of Science and Technology, was saying some remarkable things about innovation that might bode not too well for patent quality, when he was interviewed during a press conference held by the State Council Information Office, April 2 about China's scientific and technological research as outlined in the 12th Five-Year Plan.

Minister Wan was quoted by the Global Times saying that China's budget for research and experiment across the country should account for 2.2 percent of GDP. And that the number of patent-holders per 10,000 people should be the second benchmark.

One can question the usefulness of the latter benchmark. What kind of patents are meant, utility patents which are for incremental innovations, design-patents or invention patents? Read more about utility patent here. Quantity does not say much about the quality of patents. And patents are preoccupied with usefulness (article 22 Patent Law 2008), and scientific discoveries (article 25.1 Patent Law 2008) are excluded of getting a patent. while it could be the case that fundamental research is most fruitful in the longer run.

Read the interview at Global Times here.

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