@PCIA: 17 companies actively working on IPR for WiMAX

NASHVILLE, Tenn. – Fourth-generation technology deployments might be stifled by intellectual property rights as different ecosystems collaborate to make devices for the new standards, said Yung Hahn, president of the Open Patent Alliance at a Wednesday morning keynote at PCIA’s 2009 Wireless Infrastructure Show. The Open Patent Alliance was formed a little more than year ago to push for patent pooling for 4G technologies and to act as a resource for OPA members. OPA counts about 11 companies as members and associate members today.
Different industries view IPR differently, said Hahn, who is also director of IP Strategic Initiatives at Intel Corp., one of the early backers of WiMAX technology and the OPA. The cellular industry is familiar with a two-tier system where a small number of players own much of the IPR assets, and the rest of the industry pays more for ongoing access to that technology. In the PC space, most IPR exchanges are neutral, in that very little if any money exchanges hands, and companies pay a one-time fee. Bilateral agreements often take a long time to negotiate, Hahn said, noting he has been involved with one that took three to four years to complete. About 15 companies own essential patents for 3G technology; about 40 companies are expected to claim patent rights for 4G technology, he said. Negotiating IPR payments among that many companies could delay the time products are brought to market.
While Hahn said he expects bilateral agreements to continue to play a role in the industry, a patent pool also has a place in 4G technology since many of those companies expected to make devices for the space, like consumer electronics equipment makers, will likely shy away from paying high IPR costs. Patent pools can reduce IPR barriers to entry, encourage multiple ecosystems to contribute to the marketplace, encourage innovation and reduce costs to consumers.
Because the standard has been stabilized, the OPA is targeting WiMAX technology initially for the first 4G patent pool. OPA just held its first patent pool formation meeting for WiMAX earlier this week, where 17 companies are actively negotiating IPR licenses for the WiMAX industry. OPA also would like WiMAX IPR licensing to be transparent. Often IPR agreements are negotiated in a “cloak and dagger” manner, Hahn said in a previous interview with RCR Wireless News. Hahn said he expects the process to take about a year to complete.
Also, the companies involved in IPR for 4G technologies are probably going to have to come up with different fees if nontraditional manufacturers want to incorporate the technology into their products. For example, a percentage of the average selling price is sometimes used to figure IPR payments today, and while that may work for a handset, it likely won’t work for an automobile.
One of OPA’s greater initiatives may occur later when the OPA creates tools and resources for OPA members embroiled in patent dispute. If some of the companies with IPR agree on a pricing format, they effectively create “a credible reference point in the market,” Hahn said. Those pricing points can be considered if and when legal disputes over IPR occur.
Patent pools will work well for technologies like WiMAX and LTE as no one company is expected to hold all of the IPR. In contrast, Qualcomm Inc. holds about 50% of the essential IPR for CDMA2000 technology.