Kingsoft, Xiaomi, etc. announce new $35 million investment fund to develop new IP

On Friday, Chinese web security company Kingsoft announced that together in concert with Xiaomi, Zhigu, and more, it has established a new RMB 200 million (US$35 million) investment fund. According to Techweb, the fund will be used primarily for investments relating to the development of new intellectual property.

It’s not certain exactly what kind of IP the fund will invest in, but all signs point to the fund being a reaction to China’s antitrust investigation of Qualcomm and the subsequent decision to make Qualcomm ditch its “reverse patent license.”

The reverse patent license forced Qualcomm clients – which included many Chinese tech companies – to lift their patent fees when working with each other. But with Qualcomm now ordered to abandon that system, Chinese tech companies with numerous hardware patents (primarily Huawei and ZTE) could be in a position to gouge tech companies that don’t own as much of their IP (like Xiaomi). The establishment of this new fund suggests that rather than pay to license patents that were previously free, Xiaomi and other tech companies are interested in developing new patents of their own.

Kingsoft and Zhigu have both reportedly put RMB 10 million (US$1.6 million) into the fund, while Xiaomi has kicked in RMB 30 million (US$4.8 million). The remainder of the money will come from the fund’s other partners.

See: Xiaomi’s fitness wearables partner raises $35 million in series B funding

(Source: Techweb)