ITU Workshop on Standards and
Intellectual Property Rights
(IPR) Issues
Patent Pool: a possible means to
reduce aggregated royalties
Dr. Ir. Serge RAES,
Intellectual Property & Standards Manager
France Telecom — Orange
New Delhi, India, 19-20 December 2011
International
Telecommunication
Union
Internal Organization
Orange Labs &
Network Carriers
R&D
IP &
Licensing
Standardization &
Ecosystems Dev.
Procurement
Legal IP
Research &
Strategy
IP & Standardization Co-Ordination
New Delhi, India, 19-20 December 2011
International
Telecommunication
Union
Generalised model for rapid
licensing
PRODUCTS / SERVICES
3G LTE Patent
Pools
Missing
Link ?
Ready made tools for fast technology transfer:
- « shop window of the technology »
- Collective Licensing Agreement
IPR Policy : Fair, Reasonable and NonDiscriminatory (FRAND or RAND)
Existing
Structure
Technical standards making
• Standards bodies (ITU, ETSI, ANSI, ARIB, GISFI ?)
• Industry clubs (TM Forum, IPTV Forum, IEEE, IETF)
International
Telecommunication
Union
Quantification of RAND
LICENSING
ADMINISTRATION
PATENT POOL
PATENT EVALUATION MECHANISM
Licensing scheme:
Maximum
Aggregated
Royalty
Evaluates Patent
Essentiality
« added value »
IPR POLICY OF
STANDARDS BODIES (SDO)
STANDARDS BODIES
(ITU, ETSI, ANSI, ARIB, GISFI ? )
Basic IPR
Policy
Standards
making
International
Telecommunication
Union
3G LTE situation : Acquiring
Essential Patent licenses
>> Essential Patents Owners
>562 patent families declared
(756 for GSM and
1605 for UMTS)
3G LTE
Patent
Pools
MAR x %
each Company
must negotiate
best deal 1 : 1
x%
MAR = Maximum Aggregated Royalties
Total
IPR
Cost ??
x%+?
?
International
Telecommunication
Union
License scope and Royalty base:
patent rights exhaustion
Added Value within Supply Chain
Licenses obtained by Final Manufacturer protect all < Manufacturers and > Operators, Service Providers and Consumers
RANGE OF SELLABLE SERVICES
FINISHED MANUFACTURED PRODUCT
WITH A SALES PRICE
30 Essential
Patents
60 Essential
Patents
1
Essential
Patent
9 Essential
Patents
Manufacturer
1
Manufacturer
2
Manufacturer
3
Final
Manufacturer
Operator
1
Service +
Application
Provider
1
Supply Chain
MANUFACTURING CHAIN
SERVICE PROVISION CHAIN CONSUMER
International
Telecommunication
Union
Patent Pool Suppliers’ Benefits
Eliminates existing licensing negotiation deficiencies (e.g.
unfair, discriminatory, complicated, time consuming,
expensive)
Catalyses market growth through easier access to technology
Reduces exposure to patent infringement litigation though
global license coverage
Minimises Essential Patent cost as a real competitive cost
element
Reduces substantially the internal licensing and negotiation
costs
Knowledge of which patents are essential and their holders
No competition issue associated with classical Patent Pools
Retains total control over your own IPR
International
Telecommunication
Union
Patent Pool Operators’ Benefits
Reduce investment cost for the acquisition of the
infrastructure
Creates a more favorable business case, arising from more
affordable technology cost, which will stimulate market launch
and growth
Removes uncertainty concerning patent infringement litigation
which could impact on the service provision
Defines a more certain and deterministic Essential Patents
environment for the planning of new commercial services
Increases the choice among competitive suppliers globally
Creates a more favorable stock market view for the standard
Removes the hassle of Essential Patent portfolio management
Retains total control over your own IPR
International
Telecommunication
Union
Collective Licensing: Conclusions
Patent Pool is not a panacea !
Bilateral licensing negotiation will continue
Large patent holders will likely stay outside
Not a remedy against Non-Practicing Entity
Collective Licensing Agreements may still
improve :
new features
exploring other business strategies (e.g.
defensive Patent Pools)
in 2012, 3G LTE Patent Pools defined
International
Telecommunication
Union
Thank you
Serge RAES
Intellectual Property & Standards Senior Manager
c/o France Telecom - Orange
Office IB 313T
38-40 rue du Général Leclerc
F-92130 Issy Les Moulineaux
France
Tel: +33 1 4529 6007
Fax: +33 1 4529 5126
serge.raes@orange.com
International
Telecommunication
Union