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| LG Electronics' smartphone with a rollable display is introduced during a press conference at the CES 2021, Jan. 11. Courtesy of LG Electronics |
By Baek Byung-yeul
Samsung Electronics and some non-practicing entities (NPEs) have shown interest in buying or using LG Electronics' fifth-generation (5G) mobile patents after LG announced in early April it was shutting down its money-losing mobile phone business, industry sources said Tuesday.
"A lot of NPEs have approached LG Electronics for the possible acquisition of its 5G mobile patents," a source familiar with the issue told The Korea Times asking for anonymity. LG's 5G mobile patents, unlike its hardware, are considered competitive.
"Various scenarios are being discussed as LG has valuable patents in both long-term evolution (LTE) and 5G standard networks. Samsung Electronics is said to be interested in using these patents via a licensing agreement, not an acquisition," the source added.
In response to this, a Samsung Electronics official said, "We have not reviewed any plans."
An NPE is a company or person who holds a patent or patent rights, but instead of manufacturing or exploiting a patented invention, it generates profits by licensing it out.
The source claimed LG's patented technologies in LTE and 5G were worth between 1 trillion won ($901 million) and 1.5 trillion won. The conglomerate has around 24,000 LTE and 5G standard essential patents.
According to data provided by IPlytics, LG has the third-largest number of 5G standard patents in the world as of February. The company has ranked No. 1 in global 4G standard patents for five straight years from 2012 to 2016, according to a U.S.-based intellectual property research firm TechIPM.
Standard patents refer to essential technologies that must be used to implement specific features in related products, and so LG's super-fast network patents have been on the bidding list for NPEs from China and the United States, another source said.
LG Electronics discussed the sale of its mobile phone "hardware" with Vietnam's Vingroup, however, the talks broke down over the huge price gap. Vingroup hoped to purchase LG's plants in Brazil and Vietnam for a few million dollars.
The Korean tech giant announced April5 that it would stop making mobile phones from July 31.
Regarding the possible sale of its technologies to other companies or NPEs, an LG Electronics official said, "We cannot confirm the speculation. We are reviewing the use of our network patents in other sectors such as IoT or self-driving," he added.
Despite LG Electronics having a massive amount of patents, this doesn't mean it is in a seller's market and the company would have to reconcile price differences with potential buyers of its technologies.
"As there is no specific market for trading patented technologies, prices can vary depending on who wants to buy them and what they are prepared to offer, alongside when the owner wants to sell them," a local IT industry official said. "So even if a company has secured valuable patented technologies, this means the firm may not get what it wants when selling them," the official added.
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