ACT | The App Association Senior Counsel Brian Scarpelli discusses the growing threat of FRAND abuse and what it means to small and midsize tech firms including app developers. In this webinar from August 2016, Scarpelli covers the basics of technical standards, standards essential patents, FRAND licensing and the ways in which some SEP holders are abusing their privileged positions.
Exploring Important Opportunities for the U.S. Government to Aide the Rise of the Internet of Things by Leading in Proving Clarity on FRAND
The Internet of Things (IoT) requires seamless interconnectivity among hardware and software products which can only be achieved through technological standards like WiFi, LTE, Bluetooth, etc. However, it is up to regulatory bodies to ensure that standards’ holders do not exploit their unearned market power to overcharge licensees, ACT | The App Association described in comments to the National Telecommunications and Information Association (NTIA) on June 2, 2016, in response to a request for public comment titled The Benefits, Challenges, and Potential Roles for the Government in Fostering the Advancement of the Internet of Things.
A balanced patent system is critical to promoting innovation by rewarding inventors while also ensuring they are not inappropriately compensated for the market power they gain from standardizing their technologies. An imbalance in the system is created when holders of standard-essential patents (SEPs) disregard their affirmative promises to license their SEPs on reasonable terms. That impact is especially acute for emerging small businesses and innovators. Competition law has an important role in deterring and remedying breaches of FRAND commitment. We are thus pleased that competition agencies in key markets have increasingly grappled with FRAND related issues, and we will continue to report on and analyze these developments.
Recently, the Government of India’s Department of Industrial Policy and Promotion (DIPP) issued a request for comment on its “Discussion Paper on Standard Essential Patents and Their Availability on FRAND Terms”. In inviting comments, DIPP noted its goal of “develop[ing] a suitable policy framework to define the obligations of [Standard] Essential Patent [SEP] holders and their licensees.” On April 22, 2016, ACT | The App Association submitted detailed comments to DIPP. This blog post provides context on the importance of DIPP’s efforts to clarify the meaning of a commitment to license SEPs on Fair, Reasonable and Non-Discriminatory (FRAND) terms in India, and summarizes our comments on its discussion paper.
As I have discussed in previous blog posts, the technical standards developed across a range of standards bodies for countless economic sectors and sub-sectors seek to enable interoperability among all industry participants.
When you peruse the AllThingsFRAND.com site, you will find judicial and regulatory developments around the globe on the meaning of the obligation to license standard essential patents (SEPs) on fair, reasonable, and non-discriminatory (FRAND) terms. In just the last 15 months, China, Japan, and Korea have each released key guidance documents that now treat certain breaches of FRAND commitments as potential violations of their respective antitrust laws. This blog post summarizes the FRAND related content of these key regulatory initiatives and the trends and common themes they raise in the most dynamic region of the world. ACT believes these initiatives are a good step in the right direction to provide balanced legal systems around the globe, but they also could benefit from some refinement.
Much of the public is aware that a number of controversies swirl around the treatment of patents. However, due to the high-powered litigation surrounding these disputes between large companies with household recognition (and the sometimes staggering damage awards that grab headlines), some may perceive this as simply another front in the wars between these mega corporations fought by armies of attorneys that do not relate to or impact small- and medium-sized companies.
Our industry is building an “Internet of Things.” The entire mobile ecosystem is focused on seamlessly stitching together our homes, cars, phones and watches in ways that will create endless opportunities to improve our healthcare, safety, and lifestyles. That seamless interconnectivity is made possible by technological standards, like WiFi, 4G, Bluetooth, etc., that are often developed collaboratively between several companies who own the patents to the relevant technologies.