Picture: BLOOMBERG
Picture: BLOOMBERG

Hong Kong — Alphabet’s Google and Tencent have agreed to share patents covering a range of products and technologies, an alliance between two of the world’s largest corporations.

The cross-licensing deal comes with an understanding that Alphabet, the world’s second-largest company, and Tencent, the fifth largest, will team up on developing future technologies.

The agreement may smooth the US company’s business in China while helping Tencent’s push to expand beyond its dominant position on the mainland.

The agreement is a typical industry arrangement between corporations designed to minimise patent infringements. The US company has similar deals with Samsung Electronics and others.

It is significant that Google is tying up with China’s largest corporation after effectively withdrawing its search engine from the country in 2010 by ending self-censorship.

While many of its services remain blocked, the US company is rebuilding its presence in the world’s second-largest economy by sharing its artificial intelligence software tools and ramping up investment through projects such as a new research base.

Tencent, as the operator of the ubiquitous WeChat messaging platform and the country’s leader in social media and gaming, would be a formidable ally.

"By working together on agreements such as this, tech companies can focus on building better products and services for their users," Mike Lee, Google’s head of patents, said in the statement.

JSE-listed Naspers owns about a third of Tencent. Naspers was up 1.09% to R3,700 at the JSE's opening on Friday.

Bloomberg

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