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Summary:

A group of equipment vendors and handset makers have teamed up to craft a licensing framework for the fourth-generation LTE mobile standard. Essentially the group wants to prevent the pain and suffering caused by Qualcomm’s control of 3G patents related to CDMA. Nokia, Nokia Siemens Networks, […]

A group of equipment vendors and handset makers have teamed up to craft a licensing framework for the fourth-generation LTE mobile standard. Essentially the group wants to prevent the pain and suffering caused by Qualcomm’s control of 3G patents related to CDMA.

Nokia, Nokia Siemens Networks, NextWave Wireless, Alcatel-Lucent, Sony Ericsson, NEC and Ericsson have all decided to push for “fair and reasonable” licensing terms for the patents related to LTE in next-generation wireless networks. The framework calls for LTE patents to represent a single-digit percentage of the sales price of mobile phones and a single-digit dollar figure for laptop computers.

While the participating companies have all committed to the LTE standard, it’s worth noting that the big wireless chip vendors have yet to get on board with this effort. Obviously, the handset and base station vendors would like to see IP licensing fees set to the lowest level possible, whereas the players providing silicon would prefer to let the fees be set by market forces (rather than an industry framework). Any type of licensing would have to represent a balance between getting the most money for innovation and setting a price that the market will bear, so we’ll see if this effort gains adherents from the chip side of the business.

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  1. Vijay Nagarajan Monday, April 14, 2008

    Part of the problem with LTE or any OFDMA-based standard is the diffused nature of the IP. Many more companies have a stake in the IP pie now than for example, in WCDMA in which Qualcomm has close to 30% of essential IP. So, if there is no upper bound on the royalty rates, the costs can be more prohibitive than the existing CDMA standards and will have a direct impact on the handset ASP. The handset vendors and carriers want to make sure that no one company becomes an Achilles heel in the productization and large scale proliferation of these technologies. However, even if chipset vendors join the bandwagon, these standards will still run the risk of an outsider company staking its claim on essential IP. So, while the 3GPP has tried hard not to repeat the ‘Qualcomm effect’ again for LTE, it will be interesting to see how this strategy plays out in the long run.

  2. Will 4G Networks Get Sidetracked by Patent Problems? – GigaOM Thursday, November 13, 2008

    [...] group of handset makers has banded together to create a patent framework for LTE, but other key players, notably the silicon vendors are absent. ADC adds another player to that [...]

  3. Via Licensing Pushes LTE Patent Pool Friday, May 8, 2009

    [...] patents related to the Long Term Evolution 4G wireless standard — the second such attempt to create an LTE patent pool. The creation of some sort of universal licensing scheme for LTE could theoretically lower the [...]

  4. LTE Is Too Cool for Pools Monday, May 11, 2009

    [...] Stacey Higginbotham | Monday, May 11, 2009 | 7:42 AM PT | 0 comments MPEG LA, a creator of patent pools, today announced a third attempt to create a patent pool around the fourth-generation Long Term Evolution wireless standard. The MPEG LA licenses the collection of patents around the MPEG-2 video standard, and competes with Via Licensing, which last week created its own patent pool effort for LTE. The problem is, I just don’t think these — or even an earlier pooling effort — will work. [...]

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