Chinese IT giant Huawei has signed a patent cross-licensing contract with its smartphone rival Oppo. It is expected to help improve profitability in the smartphone sector, which has deteriorated profitability due to U.S. government sanctions.

Huawei announced on the 9th that it has signed a global patent cross-licensing contract with Oppo, which includes essential patents for cellular standards such as 5G technology.



A patent cross-licensing contract is a contract that allows both companies to use each other’s patents if they have the necessary patents.



Huawei did not disclose details of the contract-related transactions.



Huawei has signed a license contract with its rival Oppo because the smartphone sector has been hit by U.S. sanctions. Huawei Chairman Ren Zhengfei ordered in April this year to convert a huge pool of patents into profits through reasonable pricing and to make efforts for research and development to generate profits.



In fact, Huawei holds a number of patents, ranking first among Chinese private companies in terms of patents, according to data released by China’s National Intellectual Property Administration (CNIPA).