How China is leveraging IP to regain control of its domestic supply chain in the RF Front-End industry

SOPHIA ANTIPOLIS, France, February 23, 2024 │ For several years, tension between China and the US have increased, reaching a peak with the ban of new communications equipment from five Chinese companies, including Huawei and ZTE, amid concerns over national security. To overcome this issue, China is pushing its domestic industries to regain a monopoly over key technologies within its territory. This could potentially lead to the progressive removal of foreigners’ activity in the country.

KnowMade has previously highlighted that various technological sectors have become battlegrounds for China and the US (see SiC power semiconductor technology: A future battlefield in the US-China trade war?). Within its territory, it has become essential for China to secure some predominant sectors, such as power electronics, semiconductors, and telecom, which involves establishing a supply chain free from foreign companies. RF Front-End module and more specifically RF acoustic wave filters are clear examples of how China may operate use intellectual property (IP) to fulfill this purpose.

Acoustic wave filters: a good example of the actual shift of IP leadership in China

Taking back acoustic filters technology under Chinese control: current IP players are as much foreign as they are domestic

What is the current IP status in China today?

Among the different component taking part of an RF Front-End module for mobile application, acoustic wave filter is the segment that shows the highest level of competition. For about 5 years, the related Chinese IP ecosystem is more dynamic compared to those in the US and Europe. This can be explained by the fact that, while in the US and Europe there are well-established players, in China there is a higher degree of internal turmoil due to the large number of players, without a clear leadership position yet. The market and IP leaders remain foreign actors such as Murata, Skyworks, Qualcomm, and Taiyo Yuden. However, according to KnowMade latest RF acoustic wave filters patent landscape, there is a shift happening right now, as evidenced by the significant increase in patent filings by Chinese players from 2019 to 2023. Over 2,600 patents have been published by Chinese players, showing a rapid acceleration in recent years (figure 1).

Table showing the time evolution of patent publications by Chinese actors in China in the RF acoustic wave filters sector.

Figure 1: Time evolution of patent publications related to RF acoustic wave filters filed by Chinese entities.

Nevertheless, foreign IP players are still competing fiercely as they have published more than 2,300 Chinese patents at the same time. Today, the patenting activity in China is balanced between Chinese and foreign patent applicants, but it may shift in favor of local IP players in the future.

Patent families owned by Chinese IP players in the RF Acoustic wave filters sector.

Figure 2: Most active Chinese IP players in 2023 according to their patenting activity related to SAW, BAW, Acoustic wave circuit and RF FE modules (source: RF Front-End Modules & Components Patent Monitor).

A young and moving ecosystem

Acoustic wave filter technology is very mature and has been used in commercial products for over 20 years. In such cases, the patent landscape is dominated by major industrial players, particularly in western countries. This trend is not as evident in China, where a significant number of new patent applications are being filed by academic institutions. In other industries, like power electronics, KnowMade has successfully connected advancements made by academics with the emergence of new companies. However, we have identified only a few connections between Chinese research organizations and industrial players in the RF Front-End IP landscape. The sole one is between ROFS Microsystem and Tianjin University. Apart from this, we have not found any instances of shared patent ownership or significant IP licensing agreements in China in this field.

Vertical innovation rather than IP collaboration: from filters to modules

No IP collaborations between Chinese industrial players in the acoustic wave filters and RF Front-End modules IP landscapes have been identified. In general, IP players tend to adopt a vertical innovation strategy, aiming to control all segments of the supply chain. Such a strategy is similar to that of major western companies. To fully comprehend the potential risks posed by Chinese players, it is essential to examine not only their patents related to RF filters, but also their IP activity surrounding RF Front-End modules. Currently, the primary agreements are made between OEMs, and there is a lack of IP collaborations between Chinese IDMs. For instance, two major Chinese OEM companies, Huawei and Xiaomi, have entered into a cross-licensing agreement for various communication technologies, including 5G. Such agreement attests that Chinese industrial players recognize the importance of IP in their national and international development strategies.

What IP levers can China activate?

China’s desire to establish a comprehensive RF Front-End module and components national supply chain, backed by IP and fundraising, is evident. In alignment with the government’s intentions, Chinese IP players openly express their goal of regaining control over strategic technologies and their production. Companies such as Sappland Microelectronics and SDSX explicitly state on their websites their joint objectives of achieving a monopoly on the market by developing independent IP and at least mastering the RF Front-End module industry from components (PA, LNA, filters, switches, tuners) to module. This is not an isolated case, and we can see these two pieces moving concretely in our RF Front-End Modules & Components Patent Monitor.

Thus, the threat to foreign companies in China becomes a threefold reality:

  • Firstly, established players may see their position compromised by legal actions. In an recent article for the Wall Street Journal, “China’s newest weapon to nab Western technology – Its courts”, Stu Woo highlighted the judicial path China was taking to acquire Western technologies.
  • Secondly, foreign companies seeking to enter the Chinese market will encounter numerous patents, which may be increasingly limited in value but increasingly large in volume. This could serve as a deterrent and restrict foreign presence, as companies will have to navigate complicated procedures to invalidate these Chinese patents or negotiate licenses with the owners.
  • Finally, the consequences of this strong development in IP activity in China are not confined to Chinese territory. If Chinese IDMs successfully strengthen their ecosystem and position in China, they may look to conquer new markets.

Fundraising and IP to support industrialization

Another point demonstrating the rise of a Chinese RF Front-End module ecosystem is the simultaneous increase in patent filings and fundraising announcements. As an example, we previously explored the case of EpicMEMS and MEMSonics, two emerging companies that have seen a significant rise in patent applications. Both companies have secured over $100 million in funding to launch their production, with the aim of becoming leading national providers of RF FEM. More recently, and further showing the national preference, SDSX, Chipbetter, Geo-Chip, and Sappland Microelectronics each successfully raised nearly 100 million CNY in July 2023. These companies are all involved in RF chip technology.

Companies such as EpicMEMS, Starshine Semiconductor, HunterSun, and OnMicro are gradually expanding their patent portfolio to cover other parts of the RF Front-End value chain. Examples of vertical innovators like Choicore and Chaocai Information, which manage to be present throughout the entire value chain, are noteworthy. Overall, from an intellectual property standpoint, it is noted that Chinese players now master all levels of this value chain, from materials to RF devices and Front-End modules.

Therefore, it cannot be ruled out that China may aspire to expand its position globally once its RF Front-End supply chain is established. India and Europe could potentially see an increase in the presence of Chinese providers, potentially accounting for half of the worldwide market. Companies such as ROFS Microsystem, RadRock Technology, and Lansus Technologies have already begun expanding their patent portfolios outside of China, particularly in the field of BAW filters.

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About our analyst
Paul Leclaire works for KnowMade as a Patent Analyst in the fields of RF technologies, Wireless communications and MEMS sensors. He holds a PhD in Micro and Nanotechnology from the University of Lille (France), in partnership with IEMN in Villeneuve-d’Ascq and CRHEA-CNRS in Sophia Antipolis (France). Paul previously worked in innovation strategy consulting firm as Consultant.

About KnowMade
KnowMade is a Technology Intelligence and IP Strategy consulting company specialized in analyzing patents and scientific publications. The company helps innovative companies, investors, and R&D organizations to understand their competitive landscape, follow technological evolutions, reduce uncertainties, and identify opportunities and risks in terms of technology and intellectual property.
KnowMade’s analysts combine their strong technology expertise and in-depth knowledge of patents with powerful analytics tools and methodologies to turn patent information and scientific literature into actionable insights, providing high added value reports for decision makers working in R&D, innovation strategy, intellectual property, and marketing. Our experts provide prior art search, patent landscape analysis, freedom-to-operate analysis, IP due diligence, and monitoring services.
KnowMade has a solid expertise in Compound Semiconductors, Power Electronics, Batteries, RF Technologies & Wireless Communications, Solid-State Lighting & Display, Photonics, Memories, MEMS & Sensors, Semiconductor Packaging, Medical Devices, Medical Imaging, Microfluidics, Biotechnology, Pharmaceutics, and Agri-Food.