The three terms “technology, standard and patent pool” frequently appear in IP news reports today. Technical development is always followed by the establishment of standards and the emergence of patent pools. Usually, a patent pool is a platform of patent licensing and transactions upon the erection of a certain standard. Recently, Sisvel proposed to set up a patent pool for the widely used Wi-Fi 802.11n technology, which had seen a technical standard come into being.
The 802.11n Needs a Patent Pool
On December 23, 2010, Sisvel announced that it was striving for a patent pool for Wi-Fi 802.11n devices and invited all patent owners that own or control patents believed to be essential to 802.11 to participate in this process. It is said that Sisvel was selected by a group of leading 802.11 patentees for the job. According to Gen. Richard Neal, President of Sisvel US, “wireless connectivity is a vital function today and 802.11n technology is becoming more and more ubiquitous in electronic devices. Forming a pool for essential patents will benefit IP owners, manufacturers, and consumers of Wi-Fi technology.”
Wi-Fi 802.11n is a wireless transmission standard protocol of the Wi-Fi Alliance after 802.11a/b/g. The 802.11 Task Group N (TGn) came into being, in order to achieve a higher band width, higher WLAN quality and a WLAN that will perform on the same level as the Ethernet. The 802.11n Standard was not formally approved by the Institute of Electrical and Electronics Engineers (IEEE) until 2009, though the MIMO OFDM technology had already been adopted by a number of manufacturers, including D-Link, Airgo, Bermai, Broadcom and Marvell, Atheros, Cisco and Intel. Their products had included wireless network adapters and wireless routers which were extensively used in desktop PCs and notebook computers.
The Twists and Turns in Standard Establishment
However, the formation of the 802.11n Standard was never easy sailing. From the time it was put on the agenda, it took seven years for the standard to finally be established. Moreover, it is interesting that “the use came before the standard.” In September 2002, IEEE formed the High-Throughput Study Group (HTSG) to study the feasibility of improving the WLAN speed; and in September 2003, IEEE set up the 802.11n Task Group (TGn) to create a standard for the 100+Mbps WLAN. Thereafter, it underwent several mediations of dissensions and disputes. The typical cases included the patent litigation raised by the Commonwealth Scientific and Industrial Research Organization (CSIRO) - Australia's national science agency - which caused the establishment of the standard to enter into a deadlock.
In 2005, CSIRO began to sue some technology companies, claiming that it owned patents to the substantial technology under this standard. It filed an application with courts to protect its right to deal with the technology. It also sought royalties payments for the patents through various US courts. IEEE 802 LAN/MAN Standards Committee (LMSC) said that it would not approve the 802.11n Standard to be an industrial standard unless it received a response from CSIRO. Many feared that the patent dispute would affect the development of the 802.11n Standard. In November 2006, CSIRO won an important victory. It obtained an injunction from a court blocking Buffalo Technology from selling certain products within the United States. However, after a long appellate process, on December 2008, a federal court of the United States finally decided to lift the injunction on Buffalo and permitted the company to engage in sales in the US market.
Soon afterwards it was reported that a confidential agreement was reached between Hewlett-Packard (HP) and CSIRO. “We can confirm that CSIRO has reached a settlement with HP regarding the wireless patent case. There’ll be no further comment at this time due to the confidentiality of ongoing negotiations.” said CSIRO spokesperson Huw Morgan. After a series of negotiations and compromises, the 802.11n standard was finally approved by IEEE to formally become an industrial standard in 2009.
After the Establishment of Standard
After it was ratified, the standard was quickly adopted and utilized. “Despite its late introduction, the publication of the 802.11n Standard was welcomed by the global wireless industry without less passion.” the Computerworld reported on March 29, 2010. After it was published in September 2009, major manufacturers of wireless devices began to launch their WLAN products compatible with the 802.11n Standard. Some of them quickly upgraded their prior products based on the 802.11n Draft Standard (version 2.0) to the formal 802.11n Standard.
Moreover, since the standard was formally established, the 802.11n-compatible products of various manufacturers have shown much improvement in both type and performance. Their inter-compatibility and interoperability have improved. In the meantime, a scale of economy has been achieved, which has finally driven down prices of the products. As 802.11n technology matures, and as the 802.11n-compatible products become more diversified and their prices continue to drop, more users will choose 802.11n technology to build their own wireless network; making it carry more diverse and essential for applications. This is one of the main momentums that drive the large-stride development of WLAN.
The Patent Pool
“In the evolution of the licensing system, it pursues licenses which are more efficient and less costly. For this sake, with such a strategy, patent pool came into existence,” said Zhang Ping, a professor from Peking University, “The most optimized technology may not always be the most advanced technology that is used in forming a standard. However, if only patented techniques or techniques with intellectual property rights are included in a technical standard, it would possibly increase the user cost and the price of the products. As a result, consumers would feel more pressure. The coming of patent pool is necessary in that many patentees put their patents together for joint licensing. Patent pooling, in and by itself, is an effective system for facilitating competition and encourage innovation.” This opinion has been verified by the development of 802.11n technology. Now, with the establishment of the standard of essential technology, it seems the right time for Sisvel to propose the 802.11n patent pool.
Sisvel is an Italian patent management company. Different from Chinese patent agency companies, it provides wider services, from patent maintenance to royalty collection, licensing to the formation of patent pools. Currently, it administers patent pools for technology related to the audio compression standards known as MP3 and MPEG Audio, the CDMA2000 family of cellular telecommunications standards, the UHFRFID Air Interface Standard, and the DVB-T and DVB-T2 Broadcast Standard.
If you mention the name Sisvel, most people involved in the industry will certainly have a number of stories connected with it. It has been related to the police raid of CeBIT stands in 2007 and the seizure of Chinese exhibits by the German customs at IFA in 2008. It is now clear why the name shows up so often in media coverage of patent-related events.
Suspected of Patent Monopolization
A lot has been said about Sisvel in the electronic industry in China. Zhu Shuqin, vice director of the Brand Management Division, Hisense Group, spoke very pointedly on September 8, 2008, after Chinese exhibits were seized by the German customs. “Sisvel replays its old tricks. The (German) customs agents tend to target Chinese brands, especially those who have done well in the European market, as well as other brands from other Asian countries or regions.” In the opinion of many Chinese companies, Sisvel relies on its patents to create monopolies and exclude Chinese companies from entering foreign markets. We are on high alert now that we see this name once again with its proposal for the formation of the 802.11n patent pool. One reason among others is that the patent pool is very prone to monopolization. Now, what will the final call be? The answer will probably come soon.
(Translated by Ren Qingtao )