Playing the long game

By Richard Buttrick

Licensors have much to think about as the environment surrounding standard-essential patents undergoes major changes

In a challenge to the status quo not seen for 20 years, in February 2015 the Institute for Electronics and Electrical Engineers (IEEE) adopted changes to its policy on the licensing of standard-essential intellectual property, most notably standard-essential patents (SEPs). Not since the failed adoption by the European Telecommunications Standards Institute (ETSI) in the early 1990s of rules specifying the terms and conditions of fair, reasonable and non-discriminatory (FRAND) licensing has a standard-making body dared to step into the commercial debate between owners of SEPs and standards users. Since those early heated debates in ETSI, SEP or FRAND licensing has developed from the artisanal to an industry. Business models around SEP licensing have outlived those based on the manufacture and sale of products. At the same time, SEP licensing has courted controversy and seen high-profile legal disputes, with Microsoft v Motorola and Huawei v ZTE being recent examples. How then should a chief IP officer (CIPO) or head of intellectual property (HIP) best implement such an established, yet changing and challenged, IP licensing-based business model today?

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Issue 90