Market Insight

Patent licensing industry transition as we enter the world of 5G

March 13, 2018  | Subscribers Only

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During Mobile World Congress (MWC) 2018 (Barcelona, February 26th to March 1st), 5G was the most discussed and highlighted topic. At MWC, almost all global telecommunications service operators announced their plans to deploy their 5G services commercially some as early as late 2018. The beginning of the 5G market adoption is just around the corner.

One of three pillars of the 5G standard is to connect a massive number of IoT devices. Considering many IoT devices are already being added to the recently deployed NB-IoT, LTE-M mobile wireless networks, the licensing potential for cellular IoT space looks very promising.

This article will review the three recent trends in the cellular wireless patent licensing industry and discuss how these trends will affect the future licensing potential the latest mobile wireless technologies (i.e., 5G, NB-IoT, and LTE-M).

Below is a summary of three notable trends in the patent licensing industry:

  1. The number of patent litigations has been decreasing:
  • Over the past couple of years, the number of patent litigations filed in the United States has been declining. The main reason for the reduced number of patent litigation is due to the change in legal landscape in the US that became more favorable to defendants. Most notably, the reduction in the lawsuits filed by NPEs (Non-practicing entities) in the US has been one of the leading factors contributing to the reduced number of lawsuit filings.
  1. Many companies are joining patent pools:
  • VIA licensing, well-known patent pool licensing services company in the industry, recently announced Siemens and Conversant IP added their LTE patents to VIA’s LTE patent pool.The addition of the LTE patent portfolios enhances VIA Licensing’s already strong LTE patent pool which already includes LTE patents from major players such as AT&T, Verizon, Google, HP.
  • Avanci is a company based in Texas that offers patent pool licensing services for devices used in IoT applications. The company manages cellular standard patent pool from industry leaders Qualcomm, Ericsson, ZTE Corp., Royal KPEN NV, and InterDigital. In late 2017, IP Bridge – a licensing company in Japan – decided to add its standard patents to Avanci’s patent pool. Back in July 2017, Vodafone, Panasonic, and Sharp announced they would license their patents through Avanci.
  1. Many guidelines are released on licensing standard-essential patents:
  • In late November 2017, European Commission published a document titled “Setting out the EU approach to Standard-Essential Patents.” The objective of the report is to provide a framework that will contribute to more transparent, fair, predictable standard patent licensing practices.
  • In December 2017, US district judge James Selena of the Central District of California published a “Memorandum of Findings of Fact and Conclusions of Law” from the TCL v. Ericsson case. The document is significant since it is the first time a US court has determined Fair, Reasonable, and Non-Discriminatory (FRAND) rates for a portfolio of cellular standard-essential patents (SEPs).

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