Over 100,000 patent families have been declared essential to 4G and 5G standards. A growing share of licensing campaigns built on that number are now targeting vehicle manufacturers.
The shift is deliberate.
Smartphone licensing has largely matured, and most major handset manufacturers are already under agreement. Automotive is the next major market, and licensors are moving accordingly, filing suits in Germany and Brazil, pushing bilateral negotiations with Chinese Original equipment manufacturers (OEMs), entering European markets, and expanding pool licensing programs designed for connected vehicles.
The pressure on OEMs is real. But royalty positions often present the entire declared pool as uniformly relevant to what a vehicle actually does. That assumption doesn’t hold up.
Modern connected vehicles implement a specific, identifiable subset of cellular functionality. The gap between what has been declared essential and what is actively deployed in production vehicles is significant and measurable.
That gap is where licensing negotiations are either won or conceded by default.
This article traces how enforcement has escalated, what V2X functionality is genuinely deployed across regions and releases, and how a structured technical analysis can reduce a six-figure declared SEP pool to the fraction that is relevant to any given vehicle program.
Escalation of Telecom SEP Enforcement in Automotive
Three structural factors are driving the escalation, and they reinforce each other.
First, connectivity is now load-bearing inside vehicles.
A decade ago, a cellular module handled emergency calls and basic fleet tracking. Current platforms integrate full LTE and 5G modems supporting simultaneous services, and an increasing number include dedicated hardware for direct vehicle-to-vehicle and vehicle-to-infrastructure communication. Each additional layer broadens the surface area for SEP claims.
Second, Chinese OEM export growth has created a concentrated enforcement pressure point.
European markets are strategically significant for manufacturers scaling internationally, and German enforcement infrastructure is well-developed. The timing of suits against Geely and BYD is not coincidental; export volume and enforcement pressure are moving in the same direction.
Third, the licensing model is being formalised early. In smartphones, royalty norms evolved over the years of contested litigation. Licensors are accelerating that formalisation in automotive, pushing for pool participation before OEMs accumulate the precedents or negotiation infrastructure to challenge rates effectively.
Once established, early-stage norms are difficult to revise downward.
Why German Courts Give SEP Holders Enforcement Leverage
Germany has emerged as the centre of SEP licensing disputes.
German courts have continued to grant injunctions in a significant share of SEP cases, compelling parties toward licensing agreements when implementers are perceived as unwilling or slow to negotiate. These courts have even granted injunctions against implementers in the majority of cases where infringement was found, and the parties failed to demonstrate good-faith FRAND negotiation conduct.
What “Good-Faith Conduct” Means in Practice (Huawei v. ZTE Protocol)
Receiving a demand letter without responding within approximately 2–3 months with a substantive counteroffer is treated by German courts as evidence of unwillingness, regardless of whether the implementer claims to be “in dialogue.” The Munich 7th Civil Chamber can schedule and rule on a case within the same year as filing.
A FRAND-compliant response requires:
(1) written acknowledgement of infringement notification;
(2) expression of willingness to license on FRAND terms;
(3) substantive counter-offer within 2–3 months;
(4) provision of financial security (accounts or deposits) for ongoing use during negotiations.
German enforcement dynamics have also driven industry-level responses. The German Federal Cartel Office explicitly allowed automotive OEMs to explore joint licensing negotiation mechanisms. In July 2025, the European Commission went further, issuing a formal comfort letter clearing the Automotive Licensing Negotiation Group (ALNG) under EU competition law, its first such letter under the 2022 Informal Guidance framework.
“The Automotive Licensing Negotiation Group, founded by BMW, Mercedes-Benz, Volkswagen, and ThyssenKrupp, received EU Commission antitrust clearance on 9 July 2025. It is open to all automotive manufacturers, including Chinese OEMs. Membership enables collective negotiation with SEP holders, reducing the asymmetry inherent in individual bilateral negotiations. The Commission’s comfort letter noted conditions: (1) combined member share must not exceed 15% of SEP demand; (2) open to any automotive player; (3) voluntary for licensors.”
Note: The EU SEP Regulation proposed in April 2023, which would have established an EUIPO essentiality registry and mandatory pre-litigation FRAND determination, was formally withdrawn from the legislative agenda in October 2025. No replacement is expected in 2026. The enforcement environment, therefore, remains substantially unchanged from the licensor-favourable framework established before 2023.
The Cases That Signal Where Enforcement Is Heading
Two active disputes illustrate how licensing campaigns are being structured and what they reveal about licensor strategy beyond the individual defendant.
Nokia filed against Geely on 18 July 2024 in four simultaneous proceedings: the UPC Munich Local Division (EP 4 090 075), the UPC Mannheim Local Division (EP 3 799 333), and two Munich I Regional Court cases (EP 3 832 976; EP 3 566 488).
All four are declared essential to 4G and 5G standards. EP 3 799 333 belongs to a family that Nokia successfully litigated against OPPO and Vivo, and it arrives with a tested track record.
Geely is not an incidental target. It reported 53% export growth in 2023–24, owns Volvo Cars, Polestar, and Lotus, and holds a Smart joint venture with Mercedes-Benz.
Nokia’s stated rationale was explicit: Geely’ repeatedly rejected fair and reasonable licence agreement offers, gaining an unfair competitive advantage over licensed rivals.’
Any precedent established here on FRAND rate, portfolio scope, or negotiation conduct will be referenced directly in discussions with every other unlicensed Chinese OEM at scale.
Sol IP & IP Bridge v. BYD
The BYD campaign is more complex than a single filing. Sol IP filed at Munich I Regional Court on 7 February 2025 (EP2575281: carrier aggregation; EP2624516: ACK/NACK transmission), with additional actions at Mannheim and the UPC The Hague Local Division seeking a pan-EU injunction. IP Bridge followed in March 2025 at Munich I (EP2525515 and a related family). BYD now faces eight or more lawsuits from three or more SEP holders across three courts.
“Settling with Sol IP bilaterally does NOT resolve Avanci pool exposure; the two are additive liabilities. IP Bridge and BYD settled in May 2025 (terms undisclosed). This closes only the IP Bridge exposure. Sol IP litigation continues.
Nokia has not yet filed directly against BYD, but it is the most likely next licensor to act.
The commercial logic of the campaign: aggregate bilateral settlement costs across all Avanci licensors would likely exceed $32/vehicle, making the pool licence increasingly rational as individual suits accumulate.”
Capability Is Not Deployment, and Courts Are Starting to Distinguish Them
Modern vehicles are built on chipsets that support a wide range of LTE and 5G features across multiple 3GPP releases. Licensors typically assess exposure at this level: if a modem supports a feature defined in the standard, the related patents are treated as relevant. That framing, left unchallenged, overstates exposure materially.
Deployment operates at three distinct layers, each with different legal implications:
| Layer | What It Covers | Legal Relevance |
| 1. Silicon Capability | What the chipset is designed to support | Where licensor assertions begin |
| 2. Software Activation | What the OEM stack actually enables | Where FRAND proportionality is argued |
| 3. Infrastructure Use | What is commercially usable by region | Where court scrutiny is increasing |
A vehicle sold in China with active PC5 sidelink and the same hardware variant sold in Germany, where that functionality is not commercially enabled, represents different levels of implementation, even on identical silicon.
Asserting Layer 1 scope against a vehicle operating only at Layer 3 overstates exposure. Courts evaluating FRAND proportionality are increasingly examining what is actually implemented, not what the chipset supports.
Where This Argument Has Moved Outcomes
In recent bilateral negotiations where deployment-level mapping was presented, the asserted portfolio scope was reduced by 35–60% before rate discussions began. The reduction was driven by eliminating future-release features (R16+) not yet software-activated, features requiring infrastructure not present in the target markets, and sidelink functions hardware-present but not OEM-enabled.
Most OEMs enter licensing discussions anchored to the licensor’s declared pool. GreyB’s SEP Analysis maps your exposure to what your vehicles actually deploy, by region, release, and chipset, giving you a defensible starting position before the first exchange.
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The argument is most effective when supported by: (a) chipset data sheets confirming hardware capability, (b) OEM software configuration documentation, and (c) regional regulatory status for V2X activation. Without all three, the proportionality argument is conceptual rather than litigation-grade.
Deployed V2X Features to see What Is Actually Implemented
Analysis of the 3GPP documentation shows that V2X functionality spans 51 identifiable feature sets across different releases. These include sidelink communication, resource allocation mechanisms, and cooperative safety enhancements introduced over successive releases. However, market implementation tells a narrower story.
Of these 51 features, 28 are currently deployed in production chipsets, onboard vehicle units, or supporting roadside infrastructure. The remaining features, largely associated with later releases such as Release 16 and beyond, are still in pilot testing, research stages, or early validation programs.
Deployed features are concentrated in the earliest V2X releases: LTE PC5 Mode 3 (network-scheduled) and Mode 4 (UE-autonomous) resource allocation, semi-persistent scheduling, partial sensing, congestion control, and core sidelink architecture.
Security layer components (V2X Control Function, PSK-TLS/GBA) and core protocols (V3 authorisation, PC5 message formats, USIM V2X parameters) are also active in deployed platforms.
Features not yet commercially active include most NR sidelink enhancements, groupcast/unicast functions, NR sidelink relay, advanced V2X Phase 3 capabilities (PCS DRX for VRU, multi-operator provisioning), inter-UE coordination, and power-saving enhancements. These are among the most frequently referenced in forward-looking portfolio assertions, creating a systematic gap between what is asserted and what is deployed.
Deployment also varies by OEM type and region. Chinese domestic deployments tend to lead in PC5 activation, given China’s C-V2X infrastructure investment. European deployments remain constrained by UNECE regulatory frameworks and infrastructure readiness. Japanese and US OEMs sit between these profiles, with hardware capability ahead of software activation in most programmes.
An OEM cannot benchmark exposure without knowing where its own programme sits against this distribution.
How OEMs Can Reduce Declared SEP Exposure by Mapping Actual V2X Deployment
The scale of declared cellular SEPs can appear overwhelming. More than 100,000 patent families have been declared essential to 4G and 5G standards. However, treating that entire universe as equally relevant to V2X creates a distorted view of risk.
A structured refinement significantly changes the picture.
The 4% figure requires an important qualification. It reflects families tied to core V2X-specific functionality. It does not eliminate foundational LTE and 5G connectivity patents, those governing basic network access, scheduling, and carrier aggregation, which remain relevant to any connected vehicle regardless of V2X activation status.
An OEM negotiating solely on the V2X-layer narrowing, without addressing the foundational connectivity layer, will not close the full exposure gap.
What the filtration does is change the starting point of the conversation. Licensing discussions that begin from 100,000 declared families give the licensor a structural advantage. Discussions anchored to deployed-feature mapping, with documented Layer 2 and 3 evidence, shift the framing to proportionality, which is where FRAND case law is increasingly directing courts.
Full Exposure Modelling: Royalty Stacking Beyond Avanci
Avanci is the most visible licensing mechanism in automotive, but it does not close all exposure. Taking the $32/vehicle 5G pool licence removes litigation risk from Avanci licensors.
It does not cover SEP holders outside the pool, including Qualcomm, InterDigital, and Sisvel, each of which maintains bilateral automotive licensing programmes.
| Licensor / Pool | Est. Rate | Annual Exposure — 300K vehicles |
| Avanci 5G (pool) | $32/vehicle | $9.6M |
| Qualcomm bilateral (est.) | $5–8/vehicle | $1.5M–$2.4M |
| InterDigital bilateral (est.) | $2–4/vehicle | $0.6M–$1.2M |
| Sisvel / other bilateral (est.) | $1–3/vehicle | $0.3M–$0.9M |
| Total potential stack | ~$40–47/vehicle | ~$12–$14M/year |
Rates are estimates derived from publicly available filings and comparable licensing cases. Avanci 5G explicitly covers C-V2X. Not all bilateral licensors do. The practical question is what the relevant stack is for a specific vehicle programme, which is a direct function of deployed feature coverage.
Pool vs. Bilateral: A Framework for the Decision
Take the Avanci pool if: confirmed 5G capability in production vehicles; German/UPC injunction risk is live; vehicle volumes exceed ~200K/year; bilateral negotiation bandwidth is limited.
Negotiate bilaterally if: vehicles implement a documented narrow subset of 4G/5G features; Layer 2/3 evidence is available and defensible; you have 12–36 months and appetite to manage litigation risk.
“Chipset-level exhaustion is not a viable route. Continental’s multi-year US litigation campaign ended in complete failure in 2024; Avanci licensors do not authorise component-level exhaustion, and this position has withstood judicial challenge. Supplier indemnification covers only the supplier’s own IP, not SEPs asserted against the OEM’s end product.”
Conclusion
Enforcement by Telecom players in 2026 is now sequenced, jurisdiction-specific, and designed to establish rate norms while OEMs negotiate infrastructure that is still in development.
The question for any vehicle manufacturer receiving a demand letter or evaluating a pool offer is no longer whether exposure exists. It is whether that exposure has been technically quantified before the conversation begins.
A negotiation anchored to declared portfolio volume gives the licensor a structural advantage from the first exchange. A negotiation grounded in deployed-feature mapping, release-level relevance, and documented Layer 2/3 implementation shifts the framing to proportionality, which is both a legally recognised standard and a commercially meaningful one.
Before accepting any portfolio-wide royalty position, an OEM should be able to answer five questions:
- Which V2X features are live in our vehicles, by region, software version, and chipset generation?
- Which 3GPP releases are technically implemented versus hardware-present but software-inactive?
- Which declared SEP families map specifically to those deployed layers, not the full declared universe?
- What percentage of the asserted portfolio intersects with our actual implementation?
- Does our exposure profile justify pool entry at $32/vehicle, or does the bilateral argument hold?
Without that clarity, licensing discussions are driven by portfolio scale. With it, they are driven by technical reality. In a market where royalty norms are still being set, the difference between those two starting points is material.
GreyB’s V2X SEP Licensor Spectrum Report
In a recent project, a Chinese OEM that utilized deployed-feature mapping successfully reduced the scope of their asserted portfolios by 35–60% before entering rate discussions.
Also Read:
This was achieved by systematically eliminating features planned for future releases, inactive sidelink functions, and capabilities dependent on specific infrastructure from the asserted base.
The Spectrum Report delivers:
- Feature-level deployment mapping, which of the 28 active V2X features your vehicles implement, by region and release
- Licensor portfolio overlay, which declares families intersect with your deployed layers, and which do not
- Negotiation-ready output, defensible exposure quantification for use in bilateral or pool discussions
- Methodology transparency, AI-assisted tagging cross-validated with claim-level review for court-defensible analysis
