Enhance predictability for patent licensing on Internet of Things (IoT) devices. Create clear, industry-wide royalty structure for IoT devices with a primary function other than wireless connectivity. Efficient access to wireless connectivity to promote faster adoption of connected low-cost IoT devices.

As the Networked Society continues to evolve, more and more things benefit from being connected through cellular technology – from ships and cars to irrigation sensors. Open cellular standards including 3G and 4G/LTE have driven the mass market of communication devices, creating a world where everything can communicate on the same network, collaborate, and interconnect.

Companies, like Ericsson, that have spent billions of dollars over decades to develop the patented technologies that support these standards are committed to sharing them through fair, reasonable and non-discriminatory (FRAND) licensing terms. Technology sharing has been a hallmark of the industry since the beginning of the 2G GSM standardization effort and, thanks to FRAND patent licensing, has enabled amazing growth in the ecosystem over the last twenty-plus years.

The value of the wireless connectivity differs greatly depending on the device, capability, and use case. For example, a car that offers navigation, entertainment, maintenance, and safety features through wireless functionality will have greater “connected” value than an irrigation sensor with simple and occasional signaling capability. Ericsson seeks to establish a program where standard essential patents are cooperatively licensed and licensing terms are adapted to reflect the use, capability, and importance of the essential wireless technology to the device in question. Ultimately, the goal is to create a predictable system for both innovators and manufacturers of IoT devices.

Such a licensing system will aim for IoT devices to efficiently be covered by necessary patent licenses and leverage the benefits of global cellular coverage with flat per unit licensing fees that reflect the value of the connectivity technology for the device. This initiative will promote faster adoption for more types of things, keep markets competitive, and provide more choice for consumers. This initiative will also simplify the emerging use and speed up adoption of LTE-based Low Power Wide Area (LPWA) technologies in IoT devices which we expect would have licensing fees that are a fraction of those of a full mobile broadband experience.

Kasim Alfalahi, Chief IP Officer at Ericsson, says: “As the connected world continues to evolve, industry leaders need to evaluate business models and decide what brings the most value to the new realities that exist. Today we are able to connect things that we never dreamed of before, and the potential of IoT is enormous. Ericsson’s new joint licensing platform will ensure that patent licensing continues to adequately and fairly reward innovative companies that develop and share technologies enabling standards, while inspiring and enabling companies to develop more parts of our life to connect and communicate.”

Notes to editors

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