Standardization, Patent Pools Benefit Mobile Tech Marketplace, Experts Say
Standardization in mobile technology is helpful for collaboration and interoperability in the marketplace, but outside forces, including the current patent system and the threat of businesses heading to non-standard environments, could hurt collaborative innovation, industry experts said Thursday at a conference on IP hosted by the Center for the Protection of Intellectual Property.
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"I don't think IP hinders collaborative innovation," said Kristen Osenga, University of Richmond Law School professor. "The problem there with IP is the patent system isn't super friendly to collaborative inventors." Osenga said a lack of understanding about standard-setting by judges, legislators and commentators has harmed standardization, and clearer rules for collaborating and collaborative inventing might be needed. Courts don't understand the collaborative nature of standard-setting, Osenga said, saying patent pools -- in which companies typically allow for the use of certain patented technology under fair, reasonable and non-discriminatory licenses -- are now viewed poorly due to antitrust concerns. But Osenga said patent pools have been deemed a good practice and don't normally raise antitrust issues.
Keith Mallinson, WiseHarbor founder, said standardization is helping the mobile technology market. Consumer adoption and consumption is increasing, and prices are falling. From 2009-2014, research and development growth as a percentage kept pace with the increase in industry revenue growth, he said. Mallinson also said the collaborative nature of standard-setting organizations and standard-essential patent pools allows the best technology to be pulled forward. "It's a system that seems to be working extremely well," he said. "It's very competitive." Only one in six proposed standards is adopted by a standard-setting organization, Mallinson said.
A hike in the price of royalty agreements or an increase in injunctions could cause app developers to jump ship from patent pools or standard-setting programs, said Morgan Reed, ACT | The App Association executive director. Reed said if necessary, app developers will move to a non-standard space, but he doesn't want that to happen. "I know what the world looks like in a pre-standard world from a technology perspective, and it’s far slower and you get less creativity," he said.
Potential problems due to rising costs aside, panelists agreed standardization has benefited the mobile technology industry, and IP protections have allowed companies to collaborate and flourish. IP gives you the ability to come up with something that is not a commodity," Reed said. Mobile technology "is a very competitive and dynamic marketplace," Mallinson said. "Anyone can sell a handset now, [and] anyone" can get in that market. "That's a healthy market," he said.