Nortel Joins Wireless Providers to Hold Down LTE Patent Royalty

[Metropolitanjury]

Nortel Networks Corp. recently announced it would charge users of its LTE (Long Term Evolution) mobile technology patent royalty equaling only 1% of the retail price of a LTE handheld device, suggesting its support that 4G mobile standard is shifting to LTE technology from WiMAX.

Nortel`s LTE endorsement follows similar moves by seven mobile industry powerhouses including Ericsson, Alcatel-Lucent, NEC, NextWave Wireless, and Nokia.

Industry watchers believe the broader support of LTE by such heavyweight mobile-technology manufacturers will help accelerate global development of LTE technology.

Some analysts are watching closely to see whether the support shift will erode backing of Intel-led WiMAX, which is said to lead LTE by two years.
Nortel owns patents on orthogonal frequency division multiplexing (OFDM) and multi-input multi-output (MIMO) technologies, which are crucial to LTE standard. Industry watchers pointed out that the company`s transparent royalty rate would make production costs at gear manufacturers predicable and help reduce risk of early deployments in LTE market.

Nortel executives pointed out that preliminary deployments of LTE system worldwide would come next year at earliest.

The support shift is expected to inspire Taiwanese handset suppliers to invest more in LTE technology so that they would not miss opportunities once it begins to take off. Taiwanese handheld-device makers have developed 4G products mostly around WiMAX standard.

By Ms.Bobby Aanand, Metropolitan Jury.