Chinese smartphone maker, Xiaomi, suffered a major setback in India towards the end of 2014 as the sale of their smartphones was temporarily discontinued, following a Delhi High Court order. Subsequently, the Court decided that Xiaomi could go on with the sale of models that use Qualcomm chips until February 5, 2015, for when the next hearing for the patent case that resulted in the temporary sale ban, is scheduled.
Xiaomi has been facing legal troubles in India ever since they were sued by the Swedish technology company, Ericsson, recently, for allegedly infringing on 8 of their patents. In general, the infringing company is required to pay patent royalties in such (patent) cases, and the burden of increased cost per unit is transferred to the consumers. However, Xiaomi has assured that they will continue making smartphones of “low price-performance ratio” available for users, and that the ongoing patent battle will have no effect on the pricing of its devices in India. Xiaomi plans to continue launching new and competitively priced products in India. Xiaomi is all set to launch the flagship model Mi 4 in India this month, and has assured that they will also be launching other devices like the Mi TV.
With the Court (in the patent battle) partially lifting the ban and allowing Xiaomi to sell Qualcomm-powered handsets, they will now be able to sell Redmi 1S and the Redmi Note 4G in India. Qualcomm has entered into cross licensing agreements with a number of Chinese smartphone makers who use their chips, allowing them to use each other’s patents without facing any legal hurdles. The arrangement benefits companies like Xiaomi, which have a small contribution in the patent pool. At present, Xiaomi has over 1,600 patent applications, a majority of which were filed in the span of the last two years. Xiaomi has so far received 124 patent grants, of which 13 are for inventions, and the rest for design and utility model patents.
Emphasising on the need for a robust risk mitigation plan, Manu Jain, Head of India Operations at Xiaomi stated, “We will probably need to be a little more cautious. We will need to be more proactive in putting together a risk management or mitigation plan, to ensure that we can try and foresee any potential risk that might be coming well in advance, not only a court case.”