In 2001, Huawei began purchasing patent licenses from Qualcomm. Twenty-five years later now in 2026, the tables have turned; and it is now Qualcomm that has just signed an agreement to buy patents from Huawei.

This deal would be hard to imagine only a few years back, and signals all you need to know about how far China’s telecom industry has come.

On October 5, Huawei and Qualcomm announced a new multi-year patent cross-licensing agreement covering 5G, computing, artificial intelligence and networking technologies. Qualcomm will also purchase patents held by Huawei in the United States. The companies have not disclosed the full financial details.

To understand why this matters, you need to understand how patents shape the phone business.

Every time your phone connects to a mobile network, it relies on technologies built around global technical standards. Some of those technologies are protected by patents that companies must license to use, which are somethigng called “standard-essential patents.”

Qualcomm built up a large portfolio of mobile communications patents over decades. For phone makers, that means that when you’re building devices, you have to pay Qualcomm for the patented technologies that are used in the phone. The licensing fees are a major part of the business, and in China, those payments are often called the “Qualcomm tax.”

Huawei knows that cost well. According to 2019 figures from the company, it had paid more than $6 billion in patent royalties since signing its first licensing agreement in 2001. Nearly 80 percent of that money went to U.S. businesses.

But Huawei wasn’t content to remain on the paying side of the equation. It invested heavily in research, developed its own technologies, and worked to get them adopted into international standards.

One important example is polar codes, a technology first proposed in 2009 by Turkish researcher Erdal Arıkan. After years of engineering work, his theory was turned into a practical communications technology by Huawei, who invested in the technology and pushed for its adoption through 3GPP, the international organization for mobile communications standards. In 2016, polar codes were selected for the control channel for 5G.

That mattered because contributing technology to a global standard can give a company not only a technical advantage, but also patents that other companies may need to license.

Huawei has continued to invest heavily in research. Over the past decade, its cumulative R&D spending has exceeded 1.38 trillion yuan, and by the end of 2025, the company held more than 165,000 active granted patents, according to their own figures. By 2021, Huawei became a net recipient of patent licensing revenue for the first time, meaning it was earning more from licensing than it was paying out.

And Huawei has become a major player in the 5G patent landscape. A 2025 report by patent analytics firm Patently estimated that Huawei accounted for about 15 percent of the 5G standard-essential patent families in its analysis, ahead of Qualcomm, which accounted for around 9.8 percent.

The agreement announced this month between Huawei and Qualcomm is a significant marker: after decades of research, engineering, and work, Chinese technology is now moving from the buyer’s side of the global patent market to the negotiating table as a patent holder in its own right.