Xiaomi’s Legal Trouble Over Patents Could Herald End of Small Smartphone Makers

Smartphone securityChinese smartphone maker Xiaomi has run into a legal roadblock in India over patent issues, and it could develop into a major problem for the low-end of the smartphone market, according to a Bloomberg Businessweek article by Bruce Einhorn.
Swedish electronics company Ericsson is alleging that Xiaomi is violating eight of its patents, and has issued a successful request for an injunction against Xiaomi phones entering the Indian market until this is all settled. Somehow Xiaomi has thus far managed to get by with only twelve patents – which is apparently typical of smartphone makers of its stature – while bigger firms like Huawei hold tens of thousands of patents. Usually patent royalties are too meager for anybody to profit from suing over them, but an industry analyst interviewed for the article says they are now increasing enough for them to matter. Add to that the fact that the smartphone market is starting to become heavily saturated, and there could be a growing incentive for larger companies to use legal maneuvers like this to squeeze the little ones out.
Part of this could also be explained by technological changes. Advanced technologies like biometrics are starting to become standard on smartphones – as has been the trend with fingerprint scanners in the wake of Apple’s TouchID system – and with R&D still being a major concern in the field of biometrics, patents for the technology could start to really matter in its various applications.
In any case, the turmoil is good for developers of biometrics technology, and it’s certainly the case that smartphones remain wildly popular, so the industry itself is not in any real danger.