LG ends its US phone business by selling patents to Oppo
Faced with increased competition from Apple and Samsung on one end, and the Chinese phone makers on the other, LG decided to throw in the towel on its phone business a few years back.
It was a pity, as the company has always been an innovator, coming up with ideas like modular phones, phones with rotating displays or 3D cameras, and other crazy concepts that actually made it to fruition.
While phone geeks like us mourned the demise of LG's phone business, its market share space in the US was predominantly occupied by Motorola which also has some interesting handsets to show for it, and is a true success story in the value segment.
LG, however, hasn't been entirely deprived of its phone-related revenue. In an intriguing example of how it continues to collect money from its handset endeavors, LG keeps liquidating its mobile business by monetizing patents. Back in 2022, LG signed a patent agreement with Apple, and a new patent licensing with Oppo is only its second large monetization effort.
It has reportedly sold 48 patents to Oppo, the Chinese phone maker, which only recently resolved the patent disputes with Nokia that precluded it from selling phones globally for a good few years. Learning from this bitter experience, Oppo has apparently decided to amass a war chest of patents regardless of the price of the seller.
The 48 patents that LG sold to Oppo back in November are, according to the USPTO and The Elec, related to codecs required for video and audio streaming signal compression. Since LG is too dependent on Apple and Samsung as a supplier, it is hardly able to pursue pattern disputes with those two phone juggernauts.
This basically leaves Oppo and the other Chinese phone makers as the most logical clients for LG's patents. Oppo was reportedly prepared to pay a premium for them as it tries to ward off any potential patent litigation.
At the same time, now that it can sell phones globally again, Oppo would want to compile a suite of standard patterns of its own, for which it could in turn charge licensing fees in the future.
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