Since the 1990s, intellectual property rights have become increasingly important in the
telecommunications sector. In particular, the strategic role of patents played in the GSM
standard irrevocably changed the IPR strategies within the sector, increasing both the revenues
and barriers provided by telecom patents. The issues raised by GSM foreshadowed
comparable impacts of patents upon other ICT standards. These developments parallels
broader concerns raised by researchers about the risk that such patents impede the process of
cumulative innovation, a problem some have labeled "the tragedy of the anticommons." After
reviewing research on the various controversies regarding patents, cumulative innovation and
standardization, we review the evolution of the role of patents in telecommunications standards.
We then analyze the role of 1227 unique "essential" patents declared in the
standardization of Universal Mobile Telecommunications System (UMTS), the thirdgeneration
successor to GSM. Using a combination of data sources, we show how differences
in the timing, nature and scope of patenting activities relate to firms’ business models, competitive
position and role in the standardization activity.
From this, we offer broader observations about the limits of existing IPR policies and coordination
mechanisms, as well as the likely impact of various policy alternatives on patent
proliferation in telecommunications standardization.
|Published - 2006
|Dime Working Papers on Intellectual Property Rights