Nov 18, 2021
Qualcomm products mentioned within this post are offered by Qualcomm Technologies, Inc. and/or its subsidiaries.
Accelerating global 5G deployment takes more than industry-leading innovation and invention. Cellular standard-essential patents (SEPs) foster important technical standards that guide new generations of telecommunications advancements. Through a world-class technology licensing program, Qualcomm Technology Licensing (QTL) sets the ultimate standard for flexible and inclusive 5G licensing that enables industries to create unique, purposeful products and services for a more connected world. This program has laid the foundation for over 150 5G licensing agreements currently in place, allowing OEMs to deploy advanced 5G products globally and making it the most successful program in the industry.
At the 2021 LES Annual Meeting, QTL Senior Vice President and General Manager John Han, Qualcomm Incorporated, joined the former director of USPTO David Kappos to discuss SEP licensing and 5G in the real world. The two talked about establishing long-term licensing relationships, the process of portfolio valuation and royalty considerations, and how technology licensing is enabling unprecedented growth in the 5G space.
Here are highlights of a few critical takeaways from their fireside chat:
Licensing Executive Society Fireside Chat: John Han Highlights
Nov 18, 2021 | 8:26
How Qualcomm enables the cellular ecosystem
From smartphones to smart cities, Qualcomm is known for developing innovations that are the backbone of the wireless world we live in. We are the R&D center for the ecosystem, and known for how we enable it by developing and sharing leading technology innovations with the industry through contributing our patented technologies to relevant SDOs (Standards Developing Organizations). All parties in the ecosystem benefit from such sharing and collaboration.
Determining patent portfolio strength and valuation
Two of the key drivers that encourage technology owners to share their patented technologies with the industry is to accurately determine the strength and value of their respective global patent portfolios and to provide fair compensation to the patent holders. Many theorize, and publish reports, that attempt to determine the value of patent portfolios by counting patents, standard self-declarations, or other quantitative methods. But in real-world negotiations, Han said, there is not one easy mathematical formula that accurately determines the true and correct value of global portfolio strength.
Instead, the industry practice is for the licensor to share an adequate number of claim charts with the licensee, and holding technical discussions, if necessary, to discuss and agree on the value of one’s patent portfolio strength – and agreeing on a mutually acceptable license agreement. By conducting such bi-lateral negotiations and entering into multiple license agreements, a patent holder eventually establishes comparable license agreements with market tested and accepted portfolio valuation. Such comparable license agreements reflect the true and market accepted value of one’s patent portfolio strength.
The intent of FRAND (Fair, Reasonable, and Non-Discriminatory) is to support the thriving IP ecosystem that will continue to incentivize foundational inventions. A patent holder makes a FRAND commitment when they share or contribute their technology to the standard body, such as ETSI (European Telecommunications Standards Institute), as Standard Essential Patents (SEPs). FRAND principles ensure that patent holders do not take advantage of a standard by exerting unreasonable demands against the implementers.
However, the FRAND obligation is also a two-way street and, just as patent holders do, the implementers also have a FRAND obligation to take a license when FRAND terms are offered. If they don’t, and they infringe on the patented technologies, it would force innovators to seek legal actions in order to extract the deserved royalty payments. This scenario tends to be costly and time consuming, and could impair the patent holders’ ability to further invent.
As 5G continues to transform industries, 5G connected automobiles are at the center of everyone’s attention. Connecting vehicles to 5G networks for heightened awareness of pedestrians, other vehicles, and infrastructure – along with connected mobility services and features – is defining the modern car. Qualcomm has been licensing the auto industry for over a decade and continues to do so with its 5G technologies. While trying to rebut different myths about the auto licensing program, Han points out that the licensing royalty charged for a connected auto is not a percentage of the car price, but a single-digit dollar amount equivalent to “a large size cup of cappuccino.”
QTL empowers licensees to make products the world loves. It’s why we dedicate ourselves to fair, transparent licensing of our breakthrough technologies, promoting healthy competition and endless opportunity across the entire mobile ecosystem. Worldwide 5G deployment is accomplished through collaboration and partnerships, and QTL enables an ecosystem that helps people connect, compute, and communicate across the globe.