With 5G standards now finalized, the companies behind the technology are making pricing decisions that will influence future mobile devices. For Apple, adding 5G to new iPhones could cost the company $21 per device, according to VentureBeat.
According to a Wednesday report, Nokia has disclosed its licensing fee for 5G standard essential patents will be $3.48 per device. This fee is considerably lower than what rivals Ericsson and Qualcomm are charging for 5G licenses. Ericsson previous announced it would charge for its 5G patents based on a sliding scale between $2,50 and $5 based on the cost of the device.
Qualcomm, meanwhile, is licensing its 5G patents at 2.275 percent of a single-mode phone’s total price, and 3.25 percent for multi-mode phones. This pricing structure includes a cap of $400 per device.
Of the estimated $21 per device Apple and other companies would have to pay in royalty payments for 5G, $13 would go to Qualcomm. This doesn’t include the fees that would go other essential 5G patent holders such as Samsung and Huawei.
As IAM recently explained, these numbers don’t take into account the volume discounts that large device markers typically negotiate. These are “well below [patent] owners’ publicly disclosed rates.”
For developing the 5G standards, each of the companies get the right to license its contributions to device makers, generally under “fair, reasonable, and non-discriminatory” (FRAND) terms that will enable as many people to use the technology as possible.
As VentureBeat explains, “FRAND licensing is meant to help technology pioneers recoup and profit from their investments without unduly squeezing device makers — or consumers.”
The 5G standard, which could produce wireless speeds 100 times faster than 4G, is currently being tested by carriers such as T-Mobile, AT&T, and many more. The first mobile devices with 5G compatibility could launch in the coming months. However, the first iPhones to use the technology probably won’t arrive until at least 2019 or 2020.