1 Executive Summary Introduction Overview G-LTE Standards and Requirements G Vs. 4G: A comparison...

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2 Contents 1 Executive Summary Introduction Overview G-LTE Standards and Requirements G Vs. 4G: A comparison Analysis of 4G-LTE Patents Patent Distribution Seminal Patents Key Players in 4G-LTE Patent Landscape Samsung Qualcomm Apple & Nortel Nokia InterDigital Ericsson Potential Licensing/ Litigations in 4G-LTE Appendix 1: Glossary of Terms irunway 2012 Confidential Page 2 of 26

3 1 Executive Summary The ongoing Smartphone patent wars are about to enter a volatile new chapter as 4G-LTE technology assume a dominant position in the marketplace. Industry leaders like Apple may see a market shift as Samsung holds a leading position and other smaller companies seek to assert their 4G holdings in an explosive new wave of licensing and litigation. The report examines the current 4G-LTE patent landscape and offers analysis of existing and anticipated patent holdings. The report compares the capabilities of 3G and 4G technologies and identifies the leading 4G patent holders such as Samsung, Qualcomm and InterDigital, among others. It also outlines the evolution of key 4G technologies and provides comparative analysis of seminal (strong) patents identified based on irunway s proprietary algorithm for strength and rank calculation. The report brings to light some notable circumstances likely to influence the 4G patent landscape for the next several years. Samsung, long recognized as a devices company, invested in network and infrastructure developments well ahead of the curve, and has emerged as a leading 4G patent holder in several key categories. Interestingly, Apple, one of Samsung s key competitors, holds few 4G patents, and currently licenses 4G capabilities for its new ipad. With Apple s relatively lower patent protection in 4G, and Samsung s dominance, the marketplace may well shift. Will InterDigital s strong patent holdings in the device and network/infrastructure realms compel Apple to reduce its licensing dependence by acquiring the InterDigital portfolio? The report also anticipates a surge in litigations and licensing activities in this sphere with smaller patent holders seizing opportunities to assert their patents against leading (Fortuneranked) technology companies. Currently, less than 50% of seminal 4G patents are held by the top 10 industry players. But other seminal 4G-LTE patents are held by hundreds of medium and smaller enterprises that are likely to assert their holdings once the industry sees widespread adoption of 4G. This includes research institutes in Asia and other nonpracticing entities (NPEs). Undoubtedly, the 4G-LTE landscape is new territory that is destined to explode with activity as additional patents are granted in various categories, and both small and large industry players seek to affirm the value of their patent portfolios. irunway 2012 Confidential Page 3 of 26

4 2 Introduction 2.1 Overview There has been a burgeoning demand for faster data transmission with unprecedented penetration of Smartphone and tablets in both the developed and developing economies all across the world. This need has exponentially increased with ever-increasing processor speeds in mobile devices and expected evolution of cloud computing. In fact, Strategy Analytics forecasts that demand for data traffic will grow by times by Therefore, there is a perpetual requirement for technologies that support faster transmission. Even though global expansion of 3G networks continue to drive this decade, upgrade from 3G to 4G is inevitable as need for more efficient data transmission becomes a necessity G-LTE Standards and Requirements Long Term Evolution (LTE) is a mobile communication standard that has been set by the Third Generation Partnership Project (3GPP) as an upgrade from 3G technologies. The enhancements from 3G technology are mainly in the form of increased peak data rates, greater spectral efficiency, reduced latency and increased throughput. Additionally, International Telecommunication Union (ITU) has included LTE-Advanced as one of the approved IMT-Advanced 4G technologies. It is critical for an LTE-Advanced network to be backward compatible with LTE network in the sense that it should be possible to deploy LTE-Advanced on existing LTE spectrums. This backward compatibility ensures smooth and cost-effective transitions to LTE advanced capabilities. It is also required that LTE-Advanced should have peak data rates as high as 500 Mbps in the uplink and 1 Gbps in the downlink and high average data rates. Advantages of LTE-Advanced are: 1. Improved data transfer rate through multi-antenna solutions: Antennae are one of the most important components in radio communications and 4G technology plans to use antenna in a more efficient way for faster data rates, better long range connectivity and high reliability. Currently, LTE supports up to 4 antenna ports. LTE-Advanced looks to increase the support for the antenna. This also enhances beam-forming capabilities which imply better Signal-to-Noise Ratio (SNR). irunway 2012 Confidential Page 4 of 26

5 2. Higher spectral efficiency through wider transmission bandwidth: The high peak data rates for LTE-Advanced can be fulfilled in a reasonable way if the transmission bandwidth is enhanced. This will not only help in reaching the requirements of peak data rate but also extend the average data rates. 3. Better power management: CoMP (Coordinated multi-point transmission), a new technology based on MIMO (Multi Input Multi Output), helps improve the data transmission rates, quality of service and throughput. In other words, it means that the connection is more reliable as users access and share videos, photos, play network games or use any of the bandwidth intensive services. 4. Increased communication reliability: The idea of using relay is to make the infrastructure denser so as to reduce the transmitter to receiver distance, thereby allowing higher data rates and better connectivity. Femtocells, small cellular base stations, are one of the key components that can be installed either as standalone items or in clusters in residential or business environments. They prove to be a very costeffective way to improve coverage. 5. Enhanced network coverage: Heterogeneous networks (HetNet) often indicate the use of multiple types of access nodes in a wireless network. A wide area network can use macrocells, picocells, and/or femtocells in order to offer wireless coverage in an environment with a wide variety of wireless coverage zones, ranging from an open outdoor environment to office buildings, homes, and underground areas. 6. Improved network deployment: All operational base stations will regularly selfoptimize parameters and algorithmic behaviour in response to observed network performance and radio conditions. 7. Better network security: With seamless interoperability, and more open platforms coming into the 4G scenario the threat to security is a matter of great concern. 4G networks enable secure domain name registration, automatic VPN, allowing communication with only other secure domain names/sites. irunway 2012 Confidential Page 5 of 26

6 2.3 3G Vs. 4G: A comparison Connectivity Voice & Data Support Speed Standards Antenna Switching Techniques 3G Connectivity lowers considerably in case of weak signal reception. Simultaneous voice and data support. 384 kbps for uplink speed in R99. For HSDPA downlink is 14.4 Mbps. For HSUPA, the uplink speed is 5.76 Mbps 1. WCDMA & CDMA-2000 standards. Supports up to 4 antenna Uses a combination of circuit-switched and packet switched networks. 4G Better connectivity as a result of a wide use of femtocells to make denser & cheaper infrastructure. Simultaneous voice and data support at higher data rates. 100 Mbps for high mobility and 1 Gbps for low mobility communication. Multiple radio standards unified into single IP network. Increased support for multiantenna technology. Results in higher Signal-to-Noise Ratio. Uses only packet-switched networks. This lowers the latency considerably and increases the call quality. Table 1: 3G vs. 4G comparison Chart Even though the 4G technology is not very close to reaching its optimum peak, the implications of this technology may be far more than we understand right now. When observed closely, we see a pattern. Just as arrival of cell phones made the fixed-line phones almost obsolete and limited in their wide-spread use, arrival of 4G technology might limit the use of wired broadband services. Moreover, with better internet access, digital divide will certainly be narrowed. 1 irunway 2012 Confidential Page 6 of 26

7 3 Analysis of 4G-LTE Patents 3.1 Patent Distribution Categories Involved The following technology categories were identified based on the analysis of the 4G-LTE patent landscape. Level 1 Category Level 2 Category Applicability Directional Signal Transmission (2126) Device level Data Transfer Rate (5000) HARQ (1306) Device level MIMO (1740) Both Device & Network level Spectral efficiency (7346) OFDM (7045) Carrier Aggregation (315) Device level Network level Power Management (152) CoMP (152) Device level Communication Reliability (126) Relay (126) Network level Network Coverage (131) HetNet (131) Network level Network Deployment (257) Self Organizing Network (257) Network level Network Security (90) Network level Table 2: Level 1 & Level 2 technology categories and their applications Appendix 1 lists a glossary of the key terms related to 4G-LTE technology. The following sub-domains were found to be easily detectable for patent infringement by potential infringers: Multi Input Multi Output (MIMO) and Coordinated Multi Point Transmission (CoMP) irunway 2012 Confidential Page 7 of 26

8 Figure 1 displays the technology evolution tree for the above categories, with each circle representing the patent filed in a year in a particular category. Figure 1: Technology Evolution Tree of 4G-LTE (Source: irunway analysis based on patent data from USPTO) 3.2 Seminal Patents The entire 4G-LTE patents was analyzed and ranked using irunway s portfolio analysis solution - COMPASS SM. A list of seminal 4G-LTE patents (strong patents) was generated based on a combination of manual research and a proprietary algorithm for strength calculation. The seminal patent set constituted the top 5% of the ranked 4G-LTE patents. Unlike essential patents, which are declared by companies (primarily larger firms) on standards such as ETSI, IEEE, etc, seminal patents are a set of strong and significant patents ( STAR patents) identified from the entire portfolio. These are selected based on 22 irunway 2012 Confidential Page 8 of 26

9 parameters such as infringement detectability, number of independent and dependent claims, technology activity rate, backward and forward references, age of patent, etc. A seminal patent list helps identify other strong patents in the 4G-LTE landscape and their assignees patents primarily belonging to SMEs and NPEs. The following companies are the top patent holders in the 4G-LTE technology domain. Samsung InterDigital Ericsson Motorola Solutions, Inc Panasonic Corporation NEC America Inc. Nortel Networks Corporation Harris Corporation Qualcomm Nokia Corporation LG Corp Motorola Mobility Holdings, Inc Sony Corporation Texas Instruments Intel Corporation Of the companies listed above, Qualcomm, Ericsson and Samsung serve as key chipset suppliers to leading handset manufacturers such as Apple, HTC and others. Table 3 illustrates the patent distribution for top patent holders, their share of all 4G-LTE patents and their share of seminal patents among all 4G-LTE seminal patents. Company Name Count of All 4G-LTE patents Share of All 4G-LTE patents Count of Seminal 4G- LTE patents Share of Seminal 4G- LTE patents Samsung % % Qualcomm % % Panasonic Corporation % 13 2% InterDigital % % Nokia Corporation % % Ericsson % % LG Corp % 26 4% Motorola Solutions, Inc % 13 2% Motorola Mobility Holdings, Inc % % Sony Corporation % % NEC America Inc % % Texas Instruments % % Harris Corporation % % Nortel Networks Corporation % % Intel Corporation % % Table 3: Patent distribution of top companies (Source: Based on irunway strength analysis algorithm) irunway 2012 Confidential Page 9 of 26

10 Table 4 illustrates the distribution of patents for the top companies across categories. Patent Distribution across Categories Company Power Management Communication Reliability Network Security Network Coverage Spectral Efficiency Network Deployment Data Transfer Rate Total Samsung Qualcomm Panasonic Corporation InterDigital Nokia Corporation Ericsson LG Corp Motorola Solutions, Inc Motorola Mobility Inc Sony Corporation NEC America Inc Texas Instruments Harris Corporation Nortel Networks Corporation Intel Corporation Grand Total Table 4: Patent distribution of top companies across categories Figure 2 shows the patent filing trend of few of the top companies from Figure 2: Graph depicting filing trend of few top companies irunway 2012 Confidential Page 10 of 26

11 Figure 3 shows the patent grant trend of few of the top companies from Figure 3: Graph depicting granting trend of few top companies Samsung, compared to its competitors, accelerated and increased its investments in 4G-LTE ahead of the curve ( ). While most of the companies have a similar trend in terms of filing patents, Samsung got its patents approved and granted by USPTO earlier than other players ( ). Qualcomm also saw a similar spike in number of patents granted during the period Samsung continues to have a strong pipeline of pending applications with the patent office. This is perhaps a result of their increased research investments in 4G-LTE in the last 5 years. irunway 2012 Confidential Page 11 of 26

12 Figure 4 displays the technology evolution tree of seminal patents. Figure 4: Technology Evolution Tree of 4G-LTE Seminal Patents (Source: irunway analysis based on patent data from USPTO) irunway 2012 Confidential Page 12 of 26

13 4 Key Players in 4G-LTE Patent Landscape 4.1 Samsung Samsung is at the forefront of 4G-LTE domain with significant number of patents, including seminal patents. It leads the core 4G-LTE technology that relate to Data Transfer Rate, Power Management and Spectral Efficiency. Known as a key player in the devices space, the company has accelerated its research in Network & Infrastructure related domains in the last few years. - It has a sizeable Network-level patent portfolio and is perhaps looking to reduce its dependence on 3rd party telecom providers (especially service providers). Despite its strong patent protection, Samsung has addressed certain gaps in its portfolio by licensing patents in key areas such as 4G handset and infrastructure technology from Acacia Research in the early Figure 5: Technology Evolution Tree of Samsung s 4G-LTE Patents (Source: irunway analysis based on patent data from USPTO) 2 irunway 2012 Confidential Page 13 of 26

14 4.2 Qualcomm Qualcomm holds a significant portion of seminal patents and is currently at the forefront of innovation in the Devices space. - Nearly 80% of its patents are related to Devices with focused investments in Spectral Efficiency and Data Transfer Rate categories. - Qualcomm alone holds ~10% of patents related to Network Coverage. - It also has key patents in the HETNET and Relay categories which are essential to ensure better and smooth inter-network transition. Qualcomm is one of the key chipset suppliers to leading handset manufacturers such as Apple, HTC and others. Backed by strong patents, Qualcomm s next generation Gobi chipsets 3 - supporting 4G-LTE mobile broadband standard, is expected to out in the market from Q Figure 6: Technology Evolution Tree of Qualcomm s 4G-LTE Patents (Source: irunway analysis based on patent data from USPTO) 3 irunway 2012 Confidential Page 14 of 26

15 4.3 Apple & Nortel Apple has minimal patents in the 4G-LTE domain. In 2011, Apple joined hands with Ericsson, RIM, Microsoft and EMC to form a consortium and successfully bid for Nortel s 6000 patents. This possibly includes complete ownership of Nortel s 4G-LTE patents 4. Apple is currently using 4G-LTE technology from Qualcomm for its ipad 3 a baseband processor which provides the LTE wireless data networking capability 5. In March 2012, a day after the launch of ipad 3, Adaptix Inc. filed a patent infringement lawsuit against Apple in the field of OFDMA technology (related to 4G) 6. Acacia Research acquired Adaptix, a non-practicing entity, in January Nortel has around 150 4G-LTE patents, including seminal patents, under Data Transfer Rate and Spectral Efficiency categories. Nortel also has a significant number of patents that have been declared as essential in standards such as ETSI, IEEE, ARIB and ITU-T. Figure 7: Technology Evolution Tree of Nortel s 4G-LTE Patents (Source: irunway analysis based on patent data from USPTO) irunway 2012 Confidential Page 15 of 26

16 4.4 Nokia Figure 8: Technology Evolution Tree of Nokia s 4G-LTE Patents (Source: irunway analysis based on patent data from USPTO) Nokia has focused its 4G-LTE efforts on Data Transfer Rate and Spectral Efficiency with around 270 patents. It also has strong patents in the Network Security domain with almost 50% of all seminal patents. Nokia signed a 4G license agreement with Motorola in October 2010 covering key cellular technologies including LTE, WiMAX and LTE- Advanced 7. Nokia also signed a licensing agreement with Qualcomm in November 2009 for Qualcomm s LTE chipsets 8. In Sep 2011, MOSAID Technologies Inc. acquired Core Wireless Licensing, which had a portfolio of ~2000 wireless patents and applications including 4G-LTE patents originally filed by Nokia 9. Also ~450 patents and applications filed by Nokia (including LTE patents), were acquired by Sisvel International in January However, the acquired patents still remain licensed to Nokia under an agreement with Sisvel International aspx irunway 2012 Confidential Page 16 of 26

17 4.5 InterDigital InterDigital has significant presence in the 4G-LTE space, both in terms of quantity (number of patents - 336) and quality (number of seminal patents - 23) compared to the rest of the companies. - InterDigital has more number of 4G-LTE patents in the Devices space compared to leading handset players such as LG, Nokia, Sony and Apple. - It started investing in key 4G-LTE categories early in 2002 ahead of major players. InterDigital is currently planning to auction its patent portfolio It has strong presence in both Devices and Network/ Infrastructure domains - With wide-spread adoption of 4G in future, InterDigital s patent portfolio could be a strategic addition to any company that is looking to monetize and/ or defend its competitive position in the market. Figure 9: Technology Evolution Tree of InterDigital s 4G-LTE Patents (Source: irunway analysis based on patent data from USPTO) 11 irunway 2012 Confidential Page 17 of 26

18 4.6 Ericsson Ericsson has focused its patent investments in the Devices space with around 210 patents including 29 seminal patents. Ericsson and ZTE have cross-licensing agreements in 2G, 3G and 4G mobile technologies. This comes after a series of lawsuits and counter-lawsuits they filed against each other in multiple geographies 12. The company was part of the consortium that acquired Nortel's 6000-strong patent portfolio for $4.5 billion. This acquisition puts Ericsson at a better position in the telecommunications patent space, than before. Ericsson reorganized its licensing department in 2012 for increased patent monetization opportunities. This is seen as a strategic move by Ericsson to better leverage its IP assets 13. We can expect Ericsson to license its strong 4G-LTE portfolio aggressively. Figure 10: Technology Evolution Tree of Ericsson s 4G-LTE Patents (Source: irunway analysis based on patent data from USPTO) irunway 2012 Confidential Page 18 of 26

19 5 Potential Licensing/ Litigations in 4G-LTE Patent set comprising Essential patents which were declared on various standards were analyzed and compared with the list of seminal patents. The difference in the patent constitution between the two patent sets was significant. Larger companies such as Samsung, Qualcomm, Ericsson, etc were the ones which publicly declared their patents as essential. Unlike larger companies, SMEs and NPEs such as Adaptix Inc., Digcom Inc., Inha Industry Partnership Institute, etc. continues to remain in stealth mode despite the presence of strong patents in their portfolio. A closer look at the assignees of patents in the 4G-LTE space (other than the top companies) revealed some interesting trends on companies that can pursue efforts to monetize their patents, either through licensing or litigation. Table 5 provides information on 4G-LTE landscape of major players and others (primarily SMEs and non-practicing entities) across Devices and Network & Infrastructure patents. Assignee Category Major Players Others (SMEs/NPEs) Assignees # of Patents Devices # of Seminal Patents Network & Infrastructure # of Patents # of Seminal Patents Samsung Qualcomm InterDigital Nokia Corporation Ericsson LG Corp Motorola Solutions, Inc Motorola Mobility Holdings, Inc Panasonic Sony Electronics and Telecommunications Research Institute Industrial Technology Research Institute Korea Advanced Institute of Science and Technology (KAIST) Hong Kong Applied Science & Technology Research Institute Seoul National University Industry Foundation Massachusetts Institute of Technology California Institute of Technology Adaptix Inc Digcom Inc Innovative Sonic Table 5: Patent distribution of key players across Devices and Network & Infrastructure irunway 2012 Confidential Page 19 of 26

20 Almost 20% of seminal 4G-LTE patents are held by SMEs and non-practicing entities (NPEs). This suggests that a substantial amount of research in the field has also been initiated by these companies, requiring deeper analyses into the nature of these patents. With wide-spread adoption of 4G by consumers, the industry will witness significant increase in licensing and litigation efforts by these players against leading (Fortune ranked) technology companies. Research Institutes in Asia (China, Hong Kong, South Korea and Taiwan) hold a significant portfolio of patents in the space, including several seminal patents. These institutes have set up active patent monetization programs, and we can expect to see heavy licensing and litigation efforts by them to monetize their portfolio in the space. The key research institutes to watch out for are: - Electronics and Telecommunications Research Institute: ETRI is a non-profit government-funded Korean research organization with a sizeable 4G-LTE patent portfolio. It licenses its patents to various companies. It has over 240 4G-LTE patents (devices & networks/ infrastructure patents) and quite a few seminal patents. - Industrial Technology Research Institute: ITRI is a non-profit research institute located in Taiwan, under the supervision of the Republic of China. It has 81 4G-LTE patents (devices & networks/ infrastructure patents) and quite a few seminal patents. It entered into a licensing agreement with Samsung. They have filed for patent litigations in the past, and we only see that activity going up. - Korea Advanced Institute of Science and Technology: the Korean government in 1971 established KAIST as the nation's first research oriented science and engineering institution. It owns 27 device level and 3 Network level 4G-LTE patents. - Hong Kong Applied Science and Technology Research Institute: The institute was founded by the Government of Hong Kong SAR in 2000 to enhance Hong Kong s competitiveness in technology-based industries through applied research. It has 11 device level and 5 Network level 4G-LTE patents. - Seoul National University Industry Foundation: SNU is a national university in Seoul, South Korea. SNU holds 15 patents at the device level and another 6 at the network level. irunway 2012 Confidential Page 20 of 26

21 Educational Institutes in the USA have invested in the 4G-LTE domain and have built significant portfolios. These institutes have a history of monetizing their patents, and we expect to see them continuing their efforts on monetizing their patent portfolio in the 4G-LTE space as well. Two of the top universities with activity are: - Massachusetts institute of Technology: MIT owns a sizeable 4G-LTE portfolio. It licenses its patents to various companies. It has approximately 10 4G-LTE patents (both device and networks/ infrastructure patents). - California Institute of Technology: It has 4 (device level) 4G-LTE patents and quite a few seminal patents. It entered into an exclusive licensing agreement with Mosaid in Its patents have been litigated in the past against companies like Nokia, LG, Pantech, Toshiba, and STMicroelectronics in sensor technology. We expect it to do the same in 4G-LTE, if licensing efforts fail. Adaptix Inc., a non-practicing entity, is very active in licensing its patent portfolio. Adaptix holds 47 patents in the Devices space of 4G-LTE. It has, in the past, filed patent litigations against a host of companies such as Apple, Inc., Motorola Mobility, AT&T, Nokia Siemens, etc. Adaptix has filed a patent lawsuit in March 2012 (a day after the new ipad was launched) against Apple and AT&T related to 4G-LTE Technology. Digcom Inc. a privately held company, owned by Camillo Feher, is another major company we expect to be very active in patent litigation/licensing activity in the 4G/LTE space. It has almost 100 4G-LTE patents (device and networks/ infrastructure patents) and quite a few seminal patents. In the past, Digcom has been involved in patent litigations with defendants such as Nokia, Broadcom, Texas Instruments, Infineon Corporation, among others. We expect this to happen in the 4G/LTE space as well. Innovative Sonic, a Taiwanese company has also invested heavily in research operations relating to wireless communication technology. It has over 20 4G-LTE patents (device patents) and quite a few seminal patents. In the past, Innovative Sonic has been involved in litigations against Research in Motion 15. We expect them to continue its efforts to monetize its patents in the 4G/LTE space. There are almost 300 entities that hold over 1000 patents among them. We expect this long tail to explore opportunities to sell, license, or litigate their patents. We expect irunway 2012 Confidential Page 21 of 26

22 the major NPEs to make efforts in aggregating these patents to the extent possible. This long tail is also where several litigations are expected to arise. irunway 2012 Confidential Page 22 of 26

23 6 Appendix 1: Glossary of Terms Data Transfer Rate: The amount of digital data that is moved from one place to another in a given time. It is a measure of speed at which data is transferred across networks. Spectral Efficiency: Refers to the information rate that can be transmitted over a given bandwidth in a specific communication system. It is a measure of how efficiently a limited frequency spectrum is utilized by the networks. Power Management: Transmission powers represent a key degree of freedom in the design of wireless networks. In both cellular and ad-hoc networks, power control helps with several functionalities such as efficient spectral reuse, lifetime of the nodes and network, minimizing signal interference and maintaining connectivity. Communication Reliability: It s an indirect measure of the signal quality. Reliability of a communication network is formulated on the basis of reliabilities of individual links and stations. This is ensured by applying various error-correction techniques. Network Coverage: A geographic extent to which a network station can communicate efficiently. The ability of a mobile phone to connect to a base station depends on the strength of the signal. Network Deployment: Ease with which a network can be deployed. The aim is to minimize the manual processes in planning, integration and configuration of new base stations which will result in faster deployment, reduced cost and low error ratio. Network Security: With faster connectivity and greater interoperability, security is a matter of concern. 4G networks incorporate secure storage, mutual authentication, encryption and air-link ciphering techniques to protect data transmissions. Directional Signal Transmission (Beam-forming): Beam-forming is a signal processing technique used in sensor arrays for directional signal transmission or reception. This is achieved by combining elements in the array in a way where signals at particular angles experience constructive interference and while others experience destructive interference. What it does? - It increases network coverage, capacity, data rates, quality of service and also overcomes interference and fading effects. irunway 2012 Confidential Page 23 of 26

24 Hybrid Automatic Repeat Request (HARQ): HARQ is a combination of highrate forward error-correcting coding, and ARQ error-control for detectable but uncorrectable errors. What it does? - It provides high speed data transmission on both the uplink and downlink. Multiple-input & multiple-output (MIMO): MIMO is the use of multiple antennas at both the transmitter and receiver to improve communication performance. It is one of several forms of smart antenna technology. Note that the terms input and output refer to the radio channel carrying the signal, not to the devices having antennas. What it does? - With use of multiple antennae it provides increased capacity and better data integrity. Orthogonal Frequency-Division Multiple Access (OFDMA): OFDMA is a multi-user version of the popular orthogonal frequency-division multiplexing digital modulation scheme. Multiple access is achieved by assigning subsets of subcarriers to individual users as shown in the illustration below. This allows simultaneous low data rate transmission from several users. What it does? - It facilitates efficient use of mobile network by allowing overlap and by being more resistant to multi-path interference. Lower transmission power required from the users. Carrier Aggregation: It permits a LTE base station to group several distinct channels into one logical channel and supports wider transmission bandwidth than the 20 Mhz bandwidth specified in 3GPP 8/9. What it does? - It enables very high peak traffic and channel data rates Coordinated Multipoint Transmission (CoMP): Refers to a wide range of techniques that enable dynamic coordination or transmission and reception with several geographically separated Node Bs. Aim is to enhance the overall system performance, utilize the resources more effectively and improve the end user service quality. What it does? - Sends data to several base stations at once and the data pass through the least loaded base station. The signal received by handsets has increased overall power and it reduces the number of dropped calls irunway 2012 Confidential Page 24 of 26

25 Relay: Relays are key elements for determining the cell-edge performance that is a severe cause of performance degradation. Femtocells are one of the key components that can be installed either as standalone items or in clusters in residential or business environments. They prove to be a very cost-effective way to improve coverage. What it does? - It makes the infrastructure denser so as to reduce the transmitter to receiver distance, thereby allowing higher data rates and better connectivity. HetNet: Heterogeneous networks capable of handling several standards and is made up of small macro cells. It indicates the use of multiple types of access nodes in a wireless network. A wide area network can use macrocells, picocells, and/ or femtocells in order to offer wireless coverage in an environment with a wide variety of wireless coverage zones, ranging from an open outdoor environment to office buildings, homes, and underground areas. What it does? - It enables heterogeneous networks capable of handling several standards where the networks are made up of small macro cells. Self Organizing Network: Operational base stations that will regularly self-optimize parameters and algorithmic behavior in response to observed network performance and radio conditions. What it does? - Reduces manual processes involved in the planning, integration and configuration of new base stations. This will result in faster deployment, reduced cost and low error ratio. irunway 2012 Confidential Page 25 of 26

26 Texas 1114 Lost Creek Blvd Suite 400 Austin, TX Tel: California 2905 Stender Way Unit 28 Santa Clara, CA Tel: Colorado 8400 E. Crescent Parkway Suite 600 Greenwood Village, CO Tel: India 1 st Floor, AMR Tech Park I Annex No. 23 and 24, Hongasandra Hosur Road, Bangalore Tel: irunway is a registered trademark of irunway India Private Limited. irunway has prepared this research independently based on reliable public data and reviewed the results based on its proprietary methodology, with the belief that it is fair and not misleading. The preparers of the information in this report are not engaged in rendering legal or other professional advice, and nothing in this document should be construed as such. irunway does not practice law and it exists to provide technical research, analysis and reporting capability to its clients. The patent data in this report is as of the date of preparation and therefore is subject to change as new patents are filed and issued every day. irunway, nor any employee of irunway accepts any liability for any damages or losses, direct, indirect, consequential, arising from any use or interpretation of this report or its contents.