Essential Patents and Coordination Mechanisms: The Effects of Patent Pools and Industry Consortia on the Interplay between Patents and Technological Standards

Abstract

This article investigates the interplay between formal standards, essential patents and informal industry alliances such as consortia and patent pools. Building upon more than 6.200 declarations of essential patents to major international Standard Development Organizations (SDO), we investigate how informal standardization consortia and patent pools influence the number and timing of patent declarations to formal SDOs. This is the first thorough empirical investigation of the effectiveness of industry-driven coordination mechanisms addressing the problems raised by the high number of patents. We find that patent pools increase the number of declared essential patents controlling for the effects of standardization. On the other hand, informal consortia reduce the number of patent declarations at given standardization activity. These findings confirm results in the literature that patent pools provide incentives for strategic patent files and that informal standardization consortia have a regulatory function on the firms' patent strategies.

The Interplay of Patents and Standards for Information and Communication Technologies

“…On the one hand this is due to the growing importance of technological standards in our interconnected information and communication society, where interoperability and common agreement on a technology is crucial to unlock innovation [8]. On the other hand recent problems of IPR and standards such as patent hold-up 1 , patent ambush 2 or royalty stacking 3 behavior have caused expensive litigation cases and raised questions in patent law, contract law and especially in antitrust law ( [24]; [14]; [19]). In the field of ICT (Information and Communication Technology), standards frame a large number of innovative technologies (WiFi, LTE, RFID, DVD, Bluetooth etc.).…”

“…Under: http:// www.ftc.gov/reports/innovation/P040101PromotingInnovationand-Competitionrpt0704.pdf 11 Blind et al,EU Commission, 2011, S. 1-213, http://ec.europa.eu/ enterprise/policies/european-standards/files/standards_policy/iprworkshop/ipr_study_final_report_en.pdf. 12 [3], the data was provided by IPlytics GmbH (www.iplytics.com).…”