Joff Wild

An eagle eyed reader of the IAM blog, who also happens to be a very big player in the IP marketplace, has got in contact with a link to the licence fees the new Via Licensing LTE patent pool – the membership of which currently comprises AT&T, Clearwire, DirecTV, Hewlett Packard, KDDI, NTT DoCoMo, SK Telecom, Telefonica and ZTE, with more expected to come – will be charging for access to its patents. They are:

General Terminal Products

Volume (per unit/annual reset)   Per Unit Fee

For the first 1 to 500,000 units   $3.00

For units 500,001 to 2,500,000   $2.55

For units 2,500,001 to 5,000,000   $2.40

For units 5,000,001 to 10,000,000   $2.25

For units 10,000,001 or more   $2.10

Data Terminal Products*

Volume (per unit/annual reset)   Per Unit Fee

For the first 1 to 250,000 units   $1.50

For units 250,001 to 500,000   $1.28

For units 500,001 to 1,000,000   $1.20

For units 1,000,001 to 5,000,000   $1.13

For units 5,000,001 or more   $1.05

Femtocell Products (Home eNodeB)

Volume (per unit/annual reset) Per Unit Fee

For the first 1 to 50,000 units   $2.00

For units 50,001 to 250,000   $1.90

For units 250,001 to 500,000   $1.80

For units 500,001 to 1,000,000   $1.70

For units 1,000,001 or more   $1.60

*Data Terminal Products are limited to a specific list of product categories (that include LTE products which provide only limited or special purpose functionality), as defined in the LTE Patent License Agreement. All other terminal products fall in the General Terminal Product category.

My contact has also provided a few comments:

We need to dig further to understand if these rates are aspirational between the pool members (notice that Apple, LG, Nokia and Samsung are absent by the way) or whether these are pre-agreed rates actually being deployed in negotiations.

To my mind, it’s a clear power-play by the carriers to determine a ceiling on what constitutes FRAND in LTE (given the Apple/Moto/Samsung controversy on what actually FRAND is). The interesting thing about this is that is being driven by the CARRIERS not Apple or Samsung or other terminal companies, so it should have much more weight and credence in the courts. However, if this pool starts suing people and asking for injunctive relief from infringers, given the semi-monopolistic state of the carriers in the USA in particular (80% of traffic is from AT&T and Verizon), then there may be serious anti-trust issues.

The point is that it’s a line in the sand drawn and for other pools and entities outside the pool, as many have found from standards licensing other standards like 3GPP, MPeG2, MPEG4, it sets a precedent that the judges cannot help but make comparisons to.

What would be really interesting is to find out is how many patents are in this pool because then it would be possible to calculate what the price/per essential patent will be, as this will definitely set the bar on a per-patent basis.

Whatever else, these rates are going to be very helpful in terms of benchmarking in LTE licensing negotiations generally - and there are bound to be quite a few of these in the coming years.

Over in Europe, meanwhile, Sisvel has announced the creation of another LTE patent pool. This includes patents transferred to Sisvel by Nokia at the beginning of this year, as well as others owned by Cassidian (which is an EADS company), the China Academy of Telecommunication Technology, the Electronics and Telecommunications Research Institute, France Telecom, TDF, and KPN. This pool is charging a flat per device fee of €0.99, which makes its rates a lot less than those being charged by the Via pool; although, the patents will obviously be different and may well read on different types of LTE-related technology, while the geographies covered may not be exactly the same as those covered by the Via patent pool. But whatever else, it is also more data for licensees, licensors, courts and others to compute. Many will welcome that. Some, of course, may not!