Ericsson and LG sign mobility patent licence agreement

The confidential deal shows the value of Ericsson's patent portfolio, according to the networking giant.

Networking giant Ericsson has announced signing a global patent licence agreement with LG Electronics for the latter to utilise its cellular standard-essential patents across 2G, 3G, and 4G.

According to Ericsson, this will enable the company to obtain "a fair return" on its research and development (R&D) investments across mobility technologies.

"Ericsson and LG Electronics are two of the leading contributors to the GSM (2G), UMTS (3G), and LTE (4G) cellular communication standards, and both companies are making significant investments in the development of the NR (5G) standard," the Swedish networking company said.

The agreement will run on fair, reasonable, and non-discriminatory (FRAND) terms and conditions, and is a renewal of previous licensing arrangements.

Ericsson has been pouring R&D resources into 5G technology, with CEO Börje Ekholm pinning the company's financial hopes on capturing 5G business in future.

During the first half of 2018, R&D spend increased from 17.4 billion Swedish kronor (SEK) to 18.9 billion SEK year on year, "mainly due to increased 4G and 5G investments in networks".

The company raised $370 million in December to support its 5G, mobile, and Internet of Things (IoT) R&D activities. According to Ekholm, Ericsson saw growing demand for 5G in the most recent quarter.

During the quarter to June 30, Ericsson announced 5G trials with Australia's National Broadband Network (NBN) company; deployed a machine-learning radio network with SoftBank; and trialled LTE on the 3.5GHz band with Nokia and Verizon.

Ericsson also recently announced making a 5G data call across a commercial mobile network in partnership with Telstra and Intel, using its commercial 5G NR radio 6488, baseband, and packet core across 3.5GHz spectrum.

It last month also launched a 5G innovation lab in India, saying it will encourage collaboration on 5G technologies and applications between telecommunications carriers, industry, startups, and academia.

The Center of Excellence and Innovation Lab for 5G is located at the Indian Institute of Technology (IIT) Delhi, and is currently demonstrating 5G beamforming and beam-tracking technologies using the 3.5GHz spectrum band.

For the first half of the year, Ericsson announced net sales of 93.2 billion SEK ($10.5 billion), down from 98.1 billion SEK a year ago.

The Swedish networking giant reduced its net loss from 10.5 billion SEK this time last year to 2.5 billion SEK this half, despite spending more on research and development (R&D).

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