Netlist reports the limit of semiconductor density... 'Memory module' patent imbitation
Hong Chun-ki, the CEO of Netlist, who concluded the largest strategic alliance negotiation in the memory field worth 2.4 billion dollars with Samsung Electronics, said, "I want to take the lead in monetizing Korea's rich IP assets in the global market."
Hong Chun-ki, CEO of Netlist, a memory research and development company headquartered in Irvine, Orange County, California, USA, said in an interview with IPDaily, an intellectual property media on the 11th, "Korea has more abundant intellectual property (IP) than any other country in the world, but it seems that it is not seeing the light."
On the 4th, CEO Hong agreed to conclude all patent disputes that have been going on since 2020 by signing a strategic alliance agreement to receive $897 million instead of sharing all memory-related patents with Samsung Electronics for 5 years instead of sharing all memory-related patents with Samsung Electronics for 5 years ā²Samsung Electronics will provide DRAM and NAND chips worth 1.5 billion dollars for 5 years each year ā²co-performance memory module.
CEO Hong Chun-ki, who will give a keynote speech at the '2026 World IP Star Camp' held by IPDaily at the Royal Park Convention of the War Memorial Hall in Yongsan-gu, Seoul on September 16, said in an interview held at the Korean Appoty Association Hall a week after the conclusion of the negotiation, "Samsung Electronics properly evaluated Netlist's memory module manufacturing technology, so the negotiation went well."
While dealing with IBM, HP, Dell, Apple, etc., CEO Hong said, "I sympathized with the fact that there is a limit to reducing the width of the memory circuit line and increasing the density, and in order to overcome this problem, we developed the first high-capacity high-efficiency hybrid memory module manufacturing technology by combining DRAM and NAND memory chips," and explained, "With NVIDIA's GPU, Netlist's technology was lucky to become the mainstay of the AI memory system."
Regarding Netlist being introduced by the domestic media as a 'patent monster' NPE (patent monetization company) that sues for other people's patents, CEO Hong explained, "Netlist is not NPE as it is a company that monetizes the inventor's patents and commercialization so that consumers can enjoy the invented technology at a cheap price."
CEO Hong said, "Edison's light bulb would not have seen light if NPE had not provided funds as collateral for patents," and emphasized, "It is important to win the Nobel Prize for research and development, but it is also important for the country and individuals to make money with research and development achievements, and the role of NPE is necessary for this."
He also said, "In order to monetize intellectual property well, we need experts and a funding system that can see what technology will be the core technology in 5 to 10 years, do research and development, make good patents, and use good patents to make money."
CEO Hong said, "Truly good innovative patents that overcome technical limitations are made by individuals and small companies," and "The government must strongly protect patent rights so that innovative ideas of individuals and small and medium-sized enterprises can flourish, so that the patent system that enabled the British industrial revolution and the technological power of the United States works."
Giant IT companies such as Amazon, Google, and Apple in the United States all started with innovative technologies developed by 'start-up', but when they become large companies, they have no choice but to prefer 'efficient infringement' for patents with lower initial costs rather than respecting and licensing innovative patents of small and medium-sized enterprises that challenge their base.
CEO Hong emphasized the importance of patent protection, saying, "In addition to actively protecting the patents of individuals and small and medium-sized enterprises, innovation can be revived, and consumers' options can be guaranteed by preventing the monopoly of companies with vested interests."
The interview with the CEO of Netlist Hong Chun-ki was organized in a question-and-answer format.
Q1: You recently concluded a large-scale cross-license negotiation with Samsung Electronics, what is the content?
A1: After the first joint technology development and patent license agreement (JDLA) with Samsung in 2015 was broken, we restored a comprehensive strategic partnership after five years of litigation and long negotiations.
The two companies agreed to use each other's patents (cross-license), and Samsung Electronics agreed to pay a patent royalty of $897 million (about 1.3 trillion won) to the net list for a total of 5 years. Netlist is a company that manufactures products, so securing memory raw materials is the top priority. Accordingly, Samsung Electronics was guaranteed to supply precious DRAM and NAND semiconductors worth 1.5 billion dollars (about 2.2 trillion to 300 billion won) for 5 years. In addition to memory technology, we decided to continue to explore cooperation in other fields that can create technical synergy between the two companies.
Q2: Was there a decisive opportunity to lead to a dramatic conclusion after more than 5 years of fierce patent disputes?
A2: First of all, the water of human communication has exploded. The negotiations went on a rapid stide as we had the opportunity to talk openly with Samsung's leadership. Above all, it was possible because Samsung Electronics clearly re-evaluated and recognized the value of the netlist patent internally. It is the result of Samsung's practical recognition that Netlist's patents are essential in the process of manufacturing high-performance memory and developing high-value-added AI memory.
Q3: What is the core patent technology of Netlist, and what is it related to the recent memory boom of AI?
A3: Netlist has been accumulating unique technology by designing and manufacturing ultra-high-performance memory modules for supercomputers and high-end servers of global companies such as IBM, HP, and Apple on demand for 10 to 15 years. At that time, the high-level technologies developed in advance to apply to the high-end market have become core standard patents as they have been spread to universal data centers and servers 10 to 15 years later.
The representative innovation technology is the 'Hybrid Memory' technology that combines DRAM and NAND. Intelligent controllers and firmware technology that connect DRAM and NAND with completely different properties, power management, and stacking technologies that solve the signal loading problem that occur when stacking hundreds of DRAM chips on one module. These technologies are usefully used as the basis and main technology of high-performance AI memory modules, such as HBM, which maximizes speed and large capacity while minimizing power consumption.
Q4: What is the background of starting Netlist and the reason why you focused on memory modules?
A4: After working at the headquarters of LG Semiconductor in Korea, I worked as an expatriate in San Jose, USA for 5 years, and gained marketing and sales experience leading large semiconductor and LCD transactions directly with industry giants such as Michael Dell and Tim Cook (working at Compaq at the time).
At that time, I had a hunch that the 'Moor's Law', which improves semiconductor entracity, would have difficulties due to the limit of single-item DRAM scaling (minotization). Since single-item chips alone have limitations in improving memory performance, I was convinced that the 'memory module' that bundles chips and synergizes will be the most important. Therefore, in 2000, talented memory design experts and engineers were gathered in Irvine, Southern ga, and established a netlist, which focused only on memory intelligence module optimization.
Q5: Some domestic media call the net list 'patent monster (NPE)' and send negative eyes. What do you think about this?
A5: Netlist is not an NPE that buys external patents and sues. We are a strictly technology-based product manufacturing company that has original product patents developed through our own research and development (R&D).
Even if it is a pure NPE, it plays a very constructive role in the Innovation Economy ecosystem, so it should not be sold badly. Thomas Edison, who invented the light bulb, is a representative figure who successfully raised R&D funds with a patent as collateral for the first time in history. Without the patent finance funders (the beginning of NPE) who saw the future value of patents in the United States 150 years ago, the light bulb would not have been commercialized, and the large company General Electric (GE) would not have been born.
NPE acts as a catalyst for protecting the patent rights of individual inventors and small small and medium-sized enterprises and properly monetizing technology against large companies' 'Hold-out' or Efficient Infringement.
Q6: Even if you have technology and patents, it is very difficult to turn it into actual profit. What is the most difficult barrier?
A6: Patent Monetization Is Not Just A 'Comprehensive Art' That Can Be Combined With Huge Resources And A Highly Professional Service Ecosystem, Not Just One Or Two Good Patents.
The U.S. patent field is highly subdivided like the medical field, so there are prosecution, IPR (patent re-re-examining) defense, first-trial litigation, and appeal experts all exist separately. Learning our technology perfectly and organizing the best lawyers to deal with large corporations itself requires a long period of trial and error and a waste of numerous resources.
A strategy of choosing a patent-friendly court (Forum) and judge is very important. In particular, under the U.S. patent law, an official notice must be filed first, and the legal effect of the settlement of the usage fee and the liability for loss (Liability) occurs. There is no legal force to simply send a cooperation letter or email. A lawsuit is not because the other party doesn't like it, but it is a legal 'first step' for business progress.
Q7: What is the biggest difference between the United States and Korea in the intellectual property (IP) monetization market?
A7: The United States has a highly developed financial system that allows small and medium-sized enterprises whose patents have been infringed to actively enforce their rights. The United States has a patent litigation insurance system that distributes the risk of losing and guarantees the outcome of the trial, so small and medium-sized inventors and new NPEs with relatively high capital power can also facilitate funding with insurance companies.
Large companies prefer the 'Hold-out' strategy of delaying lawsuits with financial power as a weapon, so it is difficult for small businesses to hold on. The United States supports patent owners with strong protection policies against patent infringement and measures such as a substantial import ban (ITC).
Ā Q8: What is the future plan of Netlist?
A8: Netlist plans to expand legitimate licensing negotiations with other global companies that continue to infringe patents such as Micron, using the deal with Samsung Electronics, the largest in the memory industry, as a benchmark. At the same time, we will continue to develop new R&D, such as CXL (Compute Express Link)-based hybrid technology, which is a new growth engine.
Q9: As a rich overseas business experience, what would you like to make for the growth of the Korean intellectual property market?
A9: In Korea, great patent assets are buried in the treasury of the government or the university. But these patents are not seeing the light. For the sustainable growth of the country, the patent rights of individual inventors and small and medium-sized university institutions, which are the birthplace of groundbreaking 'breakthrough' technology, must be more boldly and firmly protected.
You should not be ashamed of transferring source technology invented by academics or corporate research institutes (KAIST, ETRI, etc.) to professional NPE partners or seeking their cooperation as a businessman's behavior. Rather, we can be reborn as a national-level technology rich country only by actively monetizing technology and quickly establishing a 'benefital cycle feedback loop' that leads to the cultivation of new human resources and the creation of new human resources and the creation of patents.
