Monetising patented wireless technologies – a technical perspective

The monetisation of patented wireless communications technologies is as important as ever. While certain factors can affect the success of licensing in this sector, some technical aspects also play a significant role and should not be overlooked.

From a technical perspective, there are two major factors to consider when conducting assertive licensing: commercial use of the patented technology and ability to show infringement. The lack of either of these can prove a critical barrier to successful licensing.

Wireless communications cover a broad range of technologies, including cellular, WiFi, Bluetooth, near-field communications, worldwide interoperability for microwave access (WiMAX) and ZigBee.

Wireless technologies distinguish themselves from many other technologies in that they rely heavily on standards which define protocols providing interoperability between devices and network infrastructure, regardless of the manufacturer. Crucially, standards also provide a reliable and relatively inexpensive source of evidence of use (EoU) for showing that a patentee’s rights are being infringed by others. In addition, widespread adoption of a particular standard typically means that there are significant revenues tied to products that comply with the standard, making patented technologies which cover features of a standard highly attractive for monetisation. However, these advantages are offset by the fact that patents which have been declared as being standard-essential are subject to fair, reasonable and non-discriminatory (FRAND) licensing terms. Nonetheless, monetisation of IP rights covering wireless standards-based functionality continues to thrive in the current IP environment.

Although standards can provide an effective source of EoU for patented technologies, it is not always sufficient to rely on them; more direct EoU is often required to show infringement. For example, although a device may comply with a particular feature described in a standard, this feature may be optional rather than essential. Further, even if a feature is described as essential, there are circumstances in which it will be seldom or never used. For example, a particular operator of a cellular network has some leeway in deciding whether to implement certain features of long-term evolution (LTE), regardless of whether these are essential or optional to the standard. In addition, although a particular patent claim may cover an essential feature of a standard, it may recite one or more features which are not described in the standard. Thus, in some cases, other sources of EoU are required. These include publicly available literature, testing and reverse engineering. While reverse engineering techniques can be useful in the context of wireless technologies, they can be expensive options for finding EoU. Given the extensive standardisation process involved with wireless technologies, many patented wireless technologies cover protocols involving messaging between wireless devices or functionality that relies on messaging, and testing or monitoring communications between devices is often a preferred method of choice for obtaining EoU. This is due to generally lower costs and a higher probability of success.

Methods for monitoring wireless communications share some commonalities across various wireless communications technologies. They can be broken down into two categories: captive testing and live network testing. Captive testing involves testing in a laboratory environment where an off-the-shelf terminal is able to connect to a network emulator, which effectively provides the function of a network access device. Captive testing configurations are well suited to investigate end-user terminals. The laboratory environment and use of a network emulator typically provides the flexibility to control the conditions under which the tests will be conducted and create a variety of test cases. This is useful when testing device functionality under different conditions and can be used to induce a desired response or operation of the terminal or network. However, this technique does not necessarily provide information on whether the device makes use of the tested function(s) in a real-world commercial environment.

In a live network testing environment, off-the-shelf terminals are connected via an air interface to a network vendor equipment (eg, WiFi hotspot or cellular base station or cell tower) which is deployed in some commercial network. There are a number of solutions for monitoring the communications between the terminal and network equipment. These offer valuable information into commercial use of patented features in commercial deployments, allowing functionality to be investigated not only at the terminal side but also at the network side. However, it is typically more difficult to control the test conditions when compared to testing in a laboratory environment.

In summary, standards associated with wireless communications technologies provide a very efficient and cost-effective source of EoU useful in showing infringement of patented technologies and the products that infringe. In addition, EoU can often be supplemented using effective test solutions which can be significantly less expensive than more direct reverse engineering solutions. The high volume of products that adopt a particular standard and the ability to effectively identify infringing products and show infringement at a relatively low cost are factors that contribute to the success of monetisation of intellectual property covering wireless communication technologies in spite of the fact that patented wireless technologies are often subject to FRAND terms.