ITU-NGMN Joint Conference on “Licensing practices in 5G industry segments"

IPR, Licensing and royalties are always an interesting topic. In the end they decide what price a device would be sold at. If I put it simply, the cost of device = cost of manufacturing + marketing + sales and distribution + support and insurance + profit + IPR. The licensing cost is often added in the end as it could be applicable on the selling price of the device.

Ericsson willing to halve its royalty rate for 5G smartphones to $2.50 per device from $5 to accommodate needs of markets such as India, Nokia likely to charge $3.50 royalty per 5G handset, while Qualcomm will charge up to $16.25 in royalties. #IPR #Patenthttps://t.co/cgZQbiwFft

— Zahid Ghadialy (@zahidtg) January 19, 2019

The above tweet is interesting as it lists out the IPR costs by major patent holders. I wrote a post earlier detailing the 5G patent holders here. Since then this have moved on significantly. In addition to the royalty charged by the 5G patent holders (it also includes legacy technologies like 2G, 3G, 4G &Wi-Fi), there are patents for messaging, Codecs (seperate for audio / video), etc. To be fair it's a complex process. This is why I sometimes get shocked when I see 4G smartphones selling for £20 ($25).

Coming back to the conference, all the presentations are available on ITU page here.

Sylvia Lu, who wears many different hats including one for CW, UK5G and uBlox and a friend of 3G4G blog was one of the speakers at this conference. Here is a tweet on what she had to say about this event:

Beyond the hype is the licensing practices to ensure 5G adoption is FRAND and work for the new 5G ecosystem incl. the verticals for 5G to scale. Many thanks for the invitation @NGMN_Alliance @itu Delight to present on behalf of @ublox@UK_5G @cambwireless https://t.co/sjwZzkN2dD pic.twitter.com/kNtjPSuKzi

— Sylvia Lu (@SylviaLuUk) January 31, 2019

For those who may not know, FRAND stands for Fair, Reasonable, And Non-Discriminatory. Wikipedia has a nice article explaining it here.

NGMN Press Release on this conference mentions the following:

The Next Generation Mobile Networks (NGMN) Alliance has jointly organised and executed a successful conference on Licensing Practices in 5G Industry Segments with the International Telecommunication Union (ITU), bringing various experts from around the world together to discuss licensing practices and challenges of 5G.

The conference featured moderators and speakers from some of the biggest names in telecoms, including AT&T, Deutsche Telekom, NTT DOCOMO, Orange, Ericsson, Nokia and Microsoft. Also in attendance were key stakeholders of vertical industries, including Audi, Bosch, Panasonic and u-Blox, and patent pool administrators, namely Avanci, MPEG-LA, Sisvel and Via Licensing, who co-sponsored the event, the European Telecommunications Standards Institute (ETSI), the Japanese and the European Patent Offices, and the European Commission.

Focusing on the development of 5G and the Internet of Things (IoT), the conference facilitated sharing and discussing of present-day licensing practices and related issues across different industry segments.

A host of insightful sessions took place igniting an inclusive exchange on:

• Patent licensing practices with interactive discussions that focused on issues stakeholders need to be aware of.
• Sharing licensors’, licensees’ and pool administrators’ requirements on patent pools/platforms.
• Identifying proposed practices and conducts for licensors and licensees.
• Listing requirements for increasing transparency and assessing essentiality of Standard Essential Patents declared to Standards Developing Organisations.

“It’s great to notice that our joint ITU-NGMN conference has been such a success,” said Dr. Peter Meissner, CEO of NGMN. “Obviously, the 5G Eco-System is different. New use cases beyond mobile broadband - like massive IoT as well as highly demanding requirements from vertical industries on low latency, ultra-high reliability and security - are causing substantial network transformations. All these challenges have implications on the intellectual property of mobile network operators and across the different industry segments. Conferences like this are key in identifying IPR issues and exploring solutions for the enlarged eco-system.”

If you have any insights on this topic, or just any comment in general, feel free to add them as comments below.

Related Article:

• Analyst Angle: R&D to patents —The complex nature of 3GPP and standards By Dimitris Mavrakis, Research Director, ABI Research - RCR Wireless

5G Patents Progress

More than 23,500 patents have been declared essential to the GSM & 3G as shown in the picture above. I am assuming this includes 4G as well. Anyway, its been a while I looked into this subject. The last time I was looking, 4G patent pools were beginning to form.

For LTE, indeed there is no one-stop shop for licensing. The only company that has tried is VIA Licensing, with their patent pool, but they don’t have licenses for the big players like Ericsson, Qualcomm, Huawei, ZTE, Samsung, etc. The same will probably apply for 5G.

This old picture and article from Telecom TV (link) is an interesting read on this topic.

This official WIPO list shows ZTE, Huawei, and Qualcomm at the top of the list for international patent filers worldwide in 2016 [PDF].

Back in 2015, NGMN alliance was also looking for creation of some kind of patent pool but it probably didn't go anywhere (link)

(Can't recall the source for this one) In March, Ericsson announced plans to license 5G for $5 per device and possibly as low as $2.50 in emerging markets. In November, Qualcomm announced plans to license 5G IP at the same rates established by the NDRC for 4G/LTE phones sold into China: 2.275% for single mode essential patents / 4.0% for the entire portfolio or 3.25% for multimode essential patents / 5.0% for the entire portfolio. All rates are based on the wholesale price of the phone.

Qualcomm also announced that the previously undisclosed $500 price cap will apply to all phones. Qualcomm also announce a rate of less than $5 for 5G for automotive applications and $0.50 for NB-IoT based IoT applications.

Ericsson has filed patent application for its end-to- end 5G technology. Ericsson has incorporated its numerous 5G and related inventions into a complete architecture for the 5G network standard. The patent application filed by the leading telecom vendor combines the work of 130 Ericsson inventors.

Dr. Stefan Parkvall, Principal Researcher at Ericsson, said, “The patent application contains Ericsson’s complementary suite of 5G inventions.” Stefan added, “It contains everything you need to build a complete 5G network. From devices, the overall network architecture, the nodes in the network, methods and algorithms, but also shows how to connect all this together into one fully functioning network. The inventions in this application will have a huge impact on industry and society: they will provide low latency with high performance and capacity.

This will enable new use cases like the Internet of Things, connected factories and self-driving cars.” Ericsson is involved with leading mobile operators across the world for 5G and Pre-5G research and trials. The patent application is likely to further strengthen its position in the 5G race.

More details on E/// 5G patents on their official website here.

Mobile world live has some good details on Qualcomm 5G NR royalty terms.

Smartphone vendors will have to pay as much as $16.25 per device to use Qualcomm’s 5G New Radio (NR) technology under new royalty guidelines released by the company.

Qualcomm said it will implement a royalty rate of 2.275 per cent of the selling price for single-mode 5G handsets and a higher rate of 3.25 per cent for multi-mode smartphones with 3G, 4G and 5G capabilities.

So for a $200 multi-mode device, for instance, Qualcomm noted a vendor would have to pay $6.50 in royalties per device. Royalties are capped at a $500 device value, meaning the maximum amount a smartphone vendor would have to pay would be $16.25 per handset.

The company added it will also offer access to its portfolio of both cellular standard essential patents and non-essential patents at a rate of 4 per cent of the selling price for single-mode devices and 5 per cent for multi-mode devices.

Qualcomm’s rates are notably higher than those announced by Ericsson in March. The Swedish company said it would charge a flat royalty fee of $5 per 5G NR multimode handset, but noted its fee could go as low as $2.50 per device for handsets with low average selling prices.

The official Qualcomm 5G royalty terms [PDF] are available here.

Further reading:

• Ericsson Tries to Avoid Patent War by Publishing Rates for 5G - Bloomberg
• Qualcomm to charge up to $16.25 in royalties for every 5G phone, more than Ericsson’s $5/phone - Fierce Wireless

Thanks to Mike Saji for providing inputs on 4G patent landscape. Thanks to Keith Dyer for interesting tweets on this topic.

Codecs and Quality across VoLTE and OTT Networks

Codecs play an important role in our smartphones. Not only are they necessary and must for encoding/decoding the voice packets but they increase the price of our smartphones too.

A $400 smartphone can have as much as $120 in IPR fees. If you notice in the picture above its $10.60 for the H.264 codec. So its important that the new codecs that will come as part of new generation of mobile technology is free, open source or costs very little.

The new standards require a lot of codecs, some for backward compatibility but this can significantly increase the costs. Its important to make sure the new codecs selected are royalty-free or free license.

The focus of this post is a presentation by Amir Zmora from AudioCodecs in the LTE Voice Summit. The presentation below may not be self-explanatory but I have added couple of links at the bottom of the post where he has shared his thoughts. Its worth a read.

Quality Across VoLTE and non-VoLTE Networks from Amir Zmora

A good explanation of Voice enhancement tools as follows (slide 15):

Adaptive Jitter Buffer (AJB) – Almost all devices today (Smartphones, IP phones, gateways, etc.) have built in jitter buffers. Legacy networks (which were LAN focused when designed) usually have older devices with less sophisticated jitter buffers. When designed they didn’t take into account traffic coming in from networks such as Wi-Fi with its frequent retransmissions and 3G with its limited bandwidth, in which the jitter levels are higher than those in wireline networks. Jitter buffers that may have been planned for, say, dozens of msec may now have to deal with peaks of hundreds of msec. Generally, if the SBC has nothing to mediate (assume the codecs are the same and the Ptime is the same on both ends) it just forwards the packets. But the unexpected jitter coming from the wireless network as described above, requires the AJB to take action. And even if the network is well designed to handle jitter, today’s OTT applications via Smart Phones add yet another variable to the equation. There are hundreds of such devices out there, and the audio interfaces of these devices (especially those of the Android phones) create jitter that is passed into the network. For these situations, too, the AJB is necessary.

To overcome this issue, there is a need for a highly advanced Adaptive Jitter Buffer (AJB) built into the SBC that neutralizes the incoming jitter so that it is handled without problem on the other side. The AJB can handle high and variable jitter rates.

Additionally, the AJB needs to work in what is called Tandem scenarios where the incoming and outgoing codec is the same. This scenario requires an efficient solution that will minimize the added delay. AudioCodes has built and patented solutions supporting this scenario.

Transcoding – While the description above discussed the ability to bypass the need to perform transcoding in the Adaptive Jitter Buffer context, there may very well be a need for transcoding between the incoming and outgoing packet streams. Beyond being able to mediate between different codecs on the different networks on either end of the SBC, the SBC can transcode an incoming codec that is less resilient to packet loss (such as narrowband G.729 or wideband G.722) to a more resilient codec (such as Opus). By transcoding to a more resilient codec, the SBC can lower the effects of packet loss. Transcoding can also lower the bandwidth on the network. Additionally, the SBC can transcode from narrowband (8Khz) to wideband (16Khz) (and vice versa) as well as wideband transcoding, where both endpoints support wideband codecs but are not using the same ones. For example, a wireless network may be using the AMR wideband codec while the wireline network on the other side may be using Opus. Had it not been for the SBC, these two networks would have negotiated a common narrowband codec.

Flexible RTP Redundancy – The SBC can also use RTP redundancy in which voice packets are sent several times to ensure they are received. Redundancy is used to balance networks which are characterized by high packet loss burst. While reducing the effect of packet loss, Redundancy increases the bandwidth (and delay). There are ways to get around this bandwidth issue that are supported by the SBC. One way is by sending only partial packet information (not fully redundant packets). The decoder on the receiving side will know how to handle the partial information. This process is called Forward Error Correction (FEC).

Transrating – Transrating is the process of having more voice payload ‘packed’ into a single RTP packet by increasing the packet intervals, thus changing the Packetization Time or Ptime. Ptime is the time represented by the compression of the voice signals into packets, generally at 20 msec intervals. In combining the payloads of two or more packets into one, the Transrating process causes a reduction in the overhead of the IP headers, lowering the bandwidth and reducing the stress on the CPU resources, however, it increases delay. It thus can be used not only to mediate between two end devices using different Ptimes, but also as a means of balancing the network by reducing bandwidth and reducing CPU pressure during traffic peaks.

Quality-based Routing – Another tool used by the SBC is Quality-based routing. The SBC, which is monitoring all the calls on the network all the time, can decide (based on pre-defined thresholds and parameters) to reroute calls over different links that have better quality.

Further reading:

• 3 Things Required for Managing Cross Network Voice Quality
• The Brain behind Voice Quality
• HD Voice - Next step in the evolution of voice communication
• Patent insanity: Royalty fees could reach $120 on a $400 smartphone

Patent Wars Part 2 - Who is suing whom

Continuing from the earlier post on the Patent Wars, here is a chart on who is suing whom.

Via: ReadWrite Mobile & Reuters

Patent Wars!

Patent wars has picked up force in the recent few months. Last week the Samsung Galaxy S2 Android phone was banned from the EU due to a suit from Apple but this ban has now been lifted. HTC has sued Apple over patents infringement and is asking for a ban in the US.

Patents are becoming more and more important. In June, Apple and Microsoft (once cut-throat rivals) teamed up with four other companies to pay $4.5 billion for the 6,000 patents held by the bankrupt Nortel Networks. This works out to $750,000 a patent. Google is now in the process of buying Motorola

NY Times report says:

Motorola Mobility in no small part because of its stockpile of 17,000 patents. The patent portfolio, some analysts estimate, could represent more than half of the value of the deal, or more than $400,000 a patent. If so, it was a relative bargain compared to the Apple and Microsoft aquisition of Nortel patents.

In the case of Motorola, Google was under pressure from its big handset partners, including HTC and Samsung, to protect them from patent-infringement suits based on their use of Google’s Android software. And Motorola has an impressive collection of mobile phone patents, a powerful weapon in patent negotiations.

Handset makers and mobile carriers are certainly hoping that Google’s purchase of Motorola will ease tensions in the smartphone market — a patent armistice among rival powers. Verizon on Tuesday welcomed the deal as a move that might well “bring some stability to the ongoing smartphone patent disputes,” John Thorne, senior vice president and deputy general counsel, said in a statement. Verizon Wireless, owned by the Vodafone Group and Verizon Communications, sells both Android-powered phones and iPhones.

In a recent blog post, David Drummond, Google’s chief legal officer, wrote that a modern smartphone might be susceptible to as many as 250,000 potential patent claims (see picture below), depending on how broadly those patents and claims were interpreted.

There was some interesting analysis on the Google Motorola deal by one Josh Pritchard in Quora:

Assuming Google would find value in the patent portfolio and not the operating businesses, an acquisition would presumably only make sense if Google had another partner (or partners), like HTC or Samsung, that wanted Motorola Mobility's operating businesses. If they could work out an arrangement with Google getting the patents and a partner (or partners) taking the other assets, then I'll argue that an acquisition could make a lot of sense based on a sum of the parts analysis.

Motorola Mobility has ~$3.2B in cash (~$170M are hiding as "cash deposits" on a separate line in the balance sheet, and are easily overlooked) with another $225M in additional payments from MSI still pending. They have $2.4B in deferred tax assets, though without reasonable expectations for operational profitability, they carry a $2.3B valuation allowance (again, easily overlooked). If the patents portfolio is worth anywhere near what Google [and Intel] bid on the Nortel patents, say $3.5B, then the sum of those parts is well over $11B in potential value. That's before assigning *any* value to the mobile and set-top operating businesses themselves.

But the operating businesses are almost certainly not worthless. They are set to generate ~$14B in revenue this year and the mobile business, with 41% Y/Y growth, is finally set to become profitable in Q4 of this year... if you believe the company's estimates. If a partner of Google's could reasonably expect to consume the operating businesses and then use their scale and/or superior supply chain to quickly bring them to even greater profitability, it's easy to imagine them being willing to pay at least some fraction of this year's revenue for the businesses, separate from the cash and tax assets. A multiple of .25X on this year's sales would be $3.5B. Seems low.

In total, that's in the neighborhood of $15B in value for a company that currently has a market cap under $7B. So, one might conclude that Google and its partner(s) could pay somewhere between those two numbers, providing a significant premium to market while still acquiring the assets below their fair value.

Of course, there are some restrictions on what MMI can do in its first 24 months as an independent entity, per the terms of the Tax Sharing Agreement documented in the 10-12B/A from the separation in January (when MOT became MSI and MMI). Per my understanding of those terms, if MMI takes actions that compromise the tax-free standing of the separation, as an outright acquisition might do, then they would be on the hook for any resulting tax liabilities. However, as the agreement states, "Though valid as between the parties, the Tax Sharing Agreement is not binding on the IRS" -- and, moreover, I believe there is quite a bit of leeway in terms of how an agreement could be structured in order to preserve the tax-free standing of the separation.

Whatever the case, a Twitter joke suggested that is people would want to retain jobs in Motorola, they better dress up as Patents and go to work.

Finally, patent pools is a good idea and can avoid lots of potential lawsuits and counter-suits. One such company very active in promoting a pool is Sisvel. A presentation from them in the LTE World Summit is embedded below.

Intellectual Property Rights (IPRs) vs.Standardization in theTelecommunications Arena: Clash of the Titans?

View more presentations from Zahid Ghadialy

An Intellectual Property Rights Primer

Page 5-8 is a very good starting point to understand the IPR issues surrounding LTE.

The Essentials of Intellectual Property - Sep 2010

View more documents from Zahid Ghadialy.

An accompanying video and download information is available on Ericsson's website here.

Sisvel's LTE Patent Pool

One of the things I wanted to blog from the LTE World Summit was the new Patent Pool by Sisvel. In past I have blogged about the patent pool initiatives from Via Licensing Corp. and MPEG LLA LLC.

Based on Sisvel's presentation, they have the most number of companies in their pool which will make them the dominant pool and give the required clout to negotiate licensing fees.

The following is from PC World Magazine:

Typically, patent pools are managed by specialized companies that don't own intellectual property themselves. They set up licensing programs, collect license fees and distribute the proceeds to member companies. In the case of LTE, three of these -- Sisvel, Via Licensing and MPEG LA -- are vying to form a pool that represents a critical mass of LTE patents.

Sisvel, an Italian company that also operates a patent pool for MPEG audio technology, this week claimed it had brought together 32 significant LTE patent holders, the largest number of any of the three patent-pool companies. "With the kind of scale that we're talking about here ... the pool could really be close to a one-stop shop," said Sean Corey, IP counsel for Sisvel US.

Meanwhile, MPEG LA says about 15 companies are working with its pool program, but added that they include some of the major players in terms of patents and market share. "There's a critical mass there," said Bill Geary, vice president of business development at MPEG LA. Via Licensing says 24 patent holders were actively discussing licensing terms and conditions at its last meeting of stakeholders, he said.

Formation of the pools is still at an early stage, with none of them yet operating and no patent holders publicly announcing their affiliations. But while all three say they are months away from operation, Via claims it has the most aggressive program. After kicking it off in January, the company could get its patent pool running in as little as 12 months, said John Ehler, Via Licensing's director of wireless programs. MPEG LA has been working on its own pool for about two years and hopes to have it in operation next year, Geary said. Sisvel's Corey said it takes between 18 months and two years to get a program going.

All three companies want to have the biggest pool, to make it easy for vendors large and small to license everything they need. In this way, patent pooling should help to accelerate adoption of LTE, the patent-pool promoters said. It could also attract a broader range of companies, such as consumer electronics makers and embedded device manufacturers, to the fast networks.

Patent pools are likely to have a bigger impact on embedded devices than on smartphones, according to Robert Syputa, an analyst at research company Maravedis. The market for machine-to-machine radio devices such as smart electrical meters is more price-sensitive than for mobile data products that consumers use, he said. Easier licensing may also draw in a wider range of vendors of such products, he said.

It's important to get pools organized early in the adoption cycle of a technology, Syputa said. If the commercial marketplace advances too far, too much intellectual property may become locked up in one-on-one licensing agreements between companies, he said. This happened with 3G, but with LTE, patent holders still have time to do it right, he said.

At least one important LTE patent holder, Ericsson, has said it will only sign bilateral license deals. Having three pool efforts in progress seems to complicate matters where just a single sanctioned one might be preferable, Syputa said. But even three pools would be preferable to a series of individual agreements, he said.

The IPR battle is not simple and straightforward as mentioned above. The following is from Daily Wireless Blog:

Qualcomm and its GSM technology counterpart InterDigital together control 40% of the LTE patent pool, with 19% and 21% of total patents, respectively, says Informa. Most LTE supporters want the royalty bill to be a one percentage of the sale price in an LTE handset, but IPR owners appear to be pushing it closer to 5% – similar to Qualcomm’s IPR tab.

Ericsson, the world’s largest wireless infrastructure manufacturer, claims to have 25 percent of the essential patents to Long Term Evolution (LTE) networks, making the vendor the single largest IPR hold in LTE. Most of the huge IPR holders in W-CDMA – Qualcomm, Nokia, Ericsson and InterDigital – are also claiming a big share of the LTE patent base.

Ericsson claims contradict a survey from Informa regarding essential IPR holders. Informa estimates Ericsson is much lower in the IPR ranking, behind Qualcomm, InterDigital, Samsung and Huawei in total patents, with emerging vendors such as Huawei also contributing 4G development research.

Ericsson believes it holds nearly 24 percent of awarded essential patents for LTE. Informa estimated that Ericsson holds about 7 percent.

Unlike Qualcomm – which by almost everyone’s calculations remains the leader in essential IPR – Ericsson is favouring a patent pool approach, which would set the total royalty rate for combined patents at under 10%, says Caroline Gabriel.

You may also want to check this (nearly) latest presentation from Alex Lee on LTE patents, embedded below:

LTE Patents for Commercial Products 2Q 2010

View more presentations from Alex Lee.

LTE and 4G IPR

The other day I heard from Alex GeunHo Lee about his new blog related to 4G technologies IPR. Alex has got extensive experience in IPR and patent related issues and I am sure his blog will be very useful for everyone.

Couple of Alex's presentations are embedded below which I am sure many would find interesting.

LTE Essential Patents Landscape 2009 2Q

4G Key Technologies Patent Landscape 2Q 2009

Complex LTE IPR System

Markus Münkler, Vodafone Group R&D spoke about IPR Regime for LTE @ LTE World Summit, Berlin

Progress since 2005
•ETSI has improved visibility of standards essential IPR across its membership
•NGMN Ltd has produced indications of the total royalty burden of candidate technologies LTE & WiMAX
•Placed IPR royalty rates in the middle of the next generation mobile economy debate
•Raised the IPR discussions to the attention of the EU and other regulatory bodies
•Built a legally sound platform of trusted collaboration among technology stakeholders

Interim conclusion
•IPR transparency has improved among engaged industry stakeholders
•However, new challenges have emerged from outside the technologydevelopers
•Therefore, IPR royalties remain a stumbling block on mobile technology developments

New LTE Patent Pool attempt

Via Licensing Corp. is looking to administer a patent pool for companies and research institutes claiming to have Intellectual Property for the emerging fast date rate cellular technology Long Term Evolution (LTE).

Last April a group of equipment vendors and handset makers already teamed up to craft a licensing framework for the fourth-generation mobile standard that is based on the 3G Partnership Project's (3GPP) E-UTRA Series 36, release 8 specifications.

The equipment vendors and handset makers that teamed up in April 2008 to establish rules for licensing patents related to the technology included Nokia, Nokia Siemens Networks, NextWave Wireless, Alcatel-Lucent, Sony Ericsson, NEC and Ericsson. They decided to push for "fair and reasonable" licensing terms for the patents related to the so-called 4G wireless network technology.

MPEG LA LLC (Denver, Colo.), the organization set up to administer access to MPEG patents, but which has also branched out into other sectors, has also started working on a patent pool for LTE and has said that several companies have already shown interest in participating in its pooling efforts.

MPEG LA, LLC recently announced that it has made significant progress working with a group of interested companies to facilitate creation of a joint patent pool license for the Long Term Evolution (LTE) Standard for mobile telecommunications. MPEG LA’s efforts, started last year, have been directed toward educating the market about the benefits of a pool license to address the patent thicket around this next generation wireless technology and assist the market with its adoption.

“The market is ready, and we are proud that industry leading companies have invited us to facilitate creation of an LTE pool license,” said MPEG LA President and CEO Larry Horn. “Given the history of telecommunications patent pools, MPEG LA has taken the time to consult directly with mobile network operators, network equipment manufacturers and mobile handset companies regarding the benefits of a patent pool for LTE, and they have encouraged MPEG LA to move forward with this effort. We are pleased by their vote of confidence. Next generation wireless technology, with its multifunctional capabilities, begs for a patent pool licensing alternative to make its full potential available to consumers worldwide, and MPEG LA’s success in creating large pool licenses uniquely positions us to achieve it.”

Via already administers patent pools for a number of technologies, notably in the broadcast, audio and wireless space, including those for MPEG2, 802.11 based Wi-Fi and near field communications (NFC). The company is a spin-out from Dolby Laboratories Inc.

Via can’t force patent holders to play, and without a majority of solid patents with which to negotiate, its attempts will fail. There’s little reason for a larger company to join a patent pool, unless it wants to help push through a standard, which isn’t the case with LTE.

Patent pools have become increasingly popular in recent years to handle licensing in cases of relatively large numbers of patent holders and licensors. The pools can help lower transaction costs and reduce uncertainty and time spent negotiating deals, sometimes with competitors across barriers of language and geography.

Generally, the cost of intellectual property associated with cell phone radio standards has been far higher than devices based on open standards such as Wi-Fi or WiMAX. That means that devices with cellular radios have been more expensive, as have the network equipment costs. I doubt industry players — including Qualcomm, which own LTE patents — are going to be eager to reduce their potential royalty income in exchange for letting Via manage the licensing process. Especially since folks at many of these firms already have the staff and knowledge to handle cross-licensing agreements.

LG causes a stir with the first LTE handset modem chip

LG recently announced that it has independently developed the first handset (user equipment) modem chip based on 3GPP Long Term Evolution (LTE) technology standards. The modem chip can theoretically support wireless download speeds of 100Mbps (megabits per second) and upload speeds of 50Mbps. This represents a significant step toward creating a market-ready 4G phone.

LG demonstrated the chip at its Mobile Communication Technology Research Lab in Anyang, Korea, achieving wireless download speeds of 60 Mbps and upload speeds of 20 Mbps. The fastest phones currently on the market use HSDPA technology and download at a maximum speed of 7.6 Mbps.

For the past three years, LG have been pursuing 3GPP LTE standardization, working to develop and test commercially viable LTE technology with approximately 250 of R&D staffs. The result is a 13 by 13 mm modem chip, perfectly sized for the next generation of slim-yet-powerful handsets. For its demonstration today, LG used a test terminal running Windows Mobile to play back high quality, on-demand video. In addition to this handset modem, LG is also developing the first preliminary LTE-based data card, which can replace the wireless cards currently used in computers.

“Now that LG has developed and tested the first 4G handset modem, a commercially viable LTE handset is on the horizon,” said Dr. Woo Hyun Paik, CTO of LG Electronics. “This latest breakthrough gives us a strong technology advantage that we will use to bolster our industry leadership.”

Dr. Paik added, "Our successful development of this LTE handset modem signals the start of the 4G mobile communications market. LG will continue to advance this technology and develop further technologies to maintain global leadership.”

Mobile phone carriers have now built LTE test networks and are currently working on early stage handsets. The first LTE mobile phones will likely reach the market in 2010.

If you remember, LG was one of the partners with T-Mobile and Nortel when they tested LTE some months back.

Anyway, LG also caused a stir with this announcement because it boasted of having 300 patents related to the technology.

The report, in Korea Times, caused ripples of nervousness because LG is not a participant in the patent pool that several large vendors formed last spring for LTE. The aim of this group is to create a cross-licensing framework, and sign up sufficient numbers of IPR holders, that it will achieve “fair and non-discriminatory pricing” amounting to a single digit percentage of the cost of a handset, and single digit dollars for a laptop, for all associated intellectual property, commented Arstechnica.

Patent pools are gaining in popularity as new standards emerge with ever larger numbers of patents involved, but with rising pressures to be cost effective. The WiMAX community created the Open Patent Alliance earlier this year, and this week, the IEEE standards body struck a two-year deal with Via Licensing, one of the most prominent patent pool administrators. This agreement will create one or more patent pools for key IEEE communications standards, including Wi-Fi. The standards group believes this will help drive its specifications into the market more quickly because vendors will have greater confidence that IPR licensing will be fair and patents declared upfront before standards find their way into commercial products.

There were some interesting discussions on IPR framework in the LTE World Summit that i will hopefully blog soon about.

via: LTE Watch