Introduction:

A recent Bloomberg article sees an increasing amount of patent litigation arising from the use of 5G and other (unnamed) wireless technologies.  Wireless telecom patent producers, like Qualcomm and Nokia (along with many others not mentioned in the article) may reap royalties from many different types of  products that communicate using wireless networks.  Examples include “talking cars” (aka V2V or V2X), and IoT devices [1.] being planned in agriculture, medicine, appliances and other sectors.

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Note 1.  The 5G/IMT 2020 use case “Massive Machine to Machine communications” is the wireless connectivity used in the IoT.  Note that IMT 2020.SPECS includes NB-IoT as one of the Radio Interface Technologies supported by 3GPP, China, Korea, and India/TSDSI.

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“So many different types of companies have to find a way to get these deals done,” said Joe Siino, president of Via Licensing, a Dolby Laboratories Inc. unit that works with audio, wireless, broadcast and automotive industries. “It’s taking the problems we had with smartphones and multiplying it by 10.”

After noting the “4G smartphone patent wars,” Bloomberg says the new wireless patent disputes are potentially more lucrative, as sales of 5G devices is forecast to grow to $668 billion globally in 2026 from $5.5 billion this year, according to Allied Market Research.  Here’s a review of recent court rulings, again from Bloomberg:

Courts in the U.S. and Europe have in the past few weeks rejected efforts claiming the telecommunications companies’ licensing policies violated antitrust laws and confirmed their ability to limit the use of fundamental wireless technology by those who refuse to meet their licensing demands.

Those rulings have already favored the telecoms in cases brought by the automobile industry in Europe and the U.S. over the current wireless standards

In the past few weeks, judges in Germany sided with Sharp Corp.’s request to limit Daimler AG sales in its home country for using its mobile technology without a license. In an unrelated case a federal judge in Texas threw out an antitrust lawsuit filed by Continental AG, a Daimler parts supplier, against a patent-licensing pool (aka Patent Troll) set up as a one-stop shop for access to patents.

That pool, Avanci LLC, handles licensing patents owned by Qualcomm, Nokia, Sharp and other telecom companies. It charges $15 per vehicle for a range of patented inventions needed to comply with 2G, 3G and 4G standards, and is developing a plan to charge for the next generation, known as 5G.

In a letter to the U.S. Federal Trade Commission (FTC), Daimler and Ford Motor Co. warned that an appeals court ruling won by Qualcomm could “destabilize the standards ecosystem by encouraging the abuse of market power acquired through collaborative standard-setting.”

And a few selected quotes:

“Patent owners want to get paid because they are proud of what they created and continue to innovate,” Kasim Alfalahi, founder and CEO of Avanci. “You have to find a middle ground, you have to find a place where these things can meet.”

“The fact that more and more industries are going to start incorporating technology that has to be standardized means it’s going to be even more important to resolve these issues,” said Katie Coltart, a patent lawyer with Kirkland & Ellis’s London office.

“You’ve got a handful of companies that are investing billions of dollars in research,” said Mark Snyder, deputy general counsel for Qualcomm. “In a functioning market, you want people to engage in earnest negotiation. FRAND is a two-way street.”

Telecoms.com Scott Bicheno wrote: “Around half of Huawei’s 5G patent applications seem to have been made in China, and they account for half of all such applications made in China. While there’s nothing intrinsically wrong with that, it’s worth noting that Samsung and LG, which are in the top three 5G patent applicants alongside Qualcomm, have hardly filed any applications in Korea. It’s almost as if the barrier to entry for patent filing in China is lower.”

5G Patent Expert Yigang Cai, PhD [2.] Comments:

• Currently, most companies generating 5G patents aim to license royalty revenues rather than to protect the intellectual property they have created.
• A high percentage of the many patents granted are not essential (professionals call them garbage patents), or only quite least claims among those patents are useful. It is kind of a waste of financial expenses and resources worldwide.
• Restrictions on the use of 5G patents will hurt most industries in the future, when 5G use cases and industry vertical applications are being developed.