How to license SEPs to promote innovation and entrepreneurship in the IoT

Henkel, Joachim

doi:10.2139/ssrn.3808987

Cited by 3 publications

(1 citation statement)

References 19 publications

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“…25 However, it should be recognised that not all declared essential patents are factually essential for a standard because of the well-documented over-disclosure problem within SDOs and the lack of independent verification of patent's essentiality. 26 Nevertheless, there are still a large number of SEP and SEP owners making efficient access to the standard by a diverse range of IoT implementers doubtful. 27 The sheer transaction costs of identifying and negotiating licenses with each and every SEP owner may be prohibitively high especially for SMEs, while the complex and non-transparent SEP landscape creates uncertainty over which patents IoT manufacturers precisely use and infringe.…”

Section:  Iot and Interoperability Standardsmentioning

confidence: 99%

Competition law and policy for the Internet of Things

Nikolic¹

2022

Pravni zapisi

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The Internet of Things (IoT) brings mobile internet connectivity to many different sectors of the economy. 5G standard is expected to play a key role in fostering seamless connectivity between devices. However, it also requires licensing patents essential for 5G standards to a diverse group of companies. How to effectively license essential patents in IoT has been the central question in recent policy debates before the European Commission. Competition law has often been invoked as a solution to either directly regulate certain licensing practices or to take a step back and enable the industry to collectively agree on certain licensing solutions. The article analyses three situations where the role of competition law was discussed: i) refusal to license patents to different levels of the production chain; ii) collective price-setting of a standard and iii) collective licensing of patents. The article examines each situation and discusses the appropriate role of competition law in fostering efficient licensing of essential patents in the IoT.

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Section:  Iot and Interoperability Standardsmentioning

confidence: 99%

Competition law and policy for the Internet of Things

Nikolic¹

2022

Pravni zapisi

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A New Approach to FRAND Royalty Determination in IoT Value Chains: Insights from Connected Cars

Pourrahim

2024

IIC

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The complexities surrounding connected cars, especially the integration of Telematics Control Units (TCUs), intensify uncertainties within their value chains. Disputes arise regarding rightful licensees and applicable rates. Standard Essential Patent (SEP) holders push for royalties from end-product manufacturers, pegged to final product prices. Conversely, manufacturers and suppliers argue for licensing directed at suppliers, restricting royalties to the TCU’s price. This discord unfolded in the legal tussle involving Nokia (SEP holder), Daimler (car manufacturer), and its supplier, litigated in German courts. This context underscores the significance behind the EU Commission’s proposal on SEP licensing issued in April 2023. Addressing escalating disputes and uncertainties surrounding Fair, Reasonable, and Non-Discriminatory (FRAND) royalty rates, the proposal aims to establish transparency and predictability in SEP licensing. In our study, we have devised a proposal aimed at reshaping this landscape. We challenge the conventional linkage of SEP royalties solely to end-product prices within intricate value chains. Instead, we advocate tying SEP royalties to the economic value attributed to the SEP, specifically focusing on connectivity within Internet of Things (IoT) applications. Our proposal suggests granting licences to the party responsible for designing the IoT component, irrespective of its role in the value chain. This functionalistic approach also proposes establishing the royalty base through technical, measurable factors like data consumption. This model offers objectivity in determining FRAND rates, potentially fostering constructive negotiations and offering environmental benefits.

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Revisiting Patent Pool Strategies through the Lens of Platforms

Yi,

Schenk

2026

Journal of Innovation Economics &Amp; Management

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How to license SEPs to promote innovation and entrepreneurship in the IoT

Cited by 3 publications

References 19 publications

Competition law and policy for the Internet of Things

Competition law and policy for the Internet of Things

A New Approach to FRAND Royalty Determination in IoT Value Chains: Insights from Connected Cars

Revisiting Patent Pool Strategies through the Lens of Platforms

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