Patents in converging mobile communication technologies

Transcription

1 Patents in converging mobile communication technologies Kim Simelius Nokia Intellectual Property Rights 1 NOKIA 2005 TUT ppt / / Kim Simelius

2 Protect inventions of technical nature -methods - products (devices, programs, ) -usefor a purpose Protect creations like text, music, art, programs Protect appearance of the product Protect commercial marks 2 NOKIA 2005 TUT ppt / / Kim Simelius Intellectual property of a company encompasses by definition everything else than the tangible assets. Of the total value of a company, more than half can nowadays be intellectual property. Intellectual property comprises intellectual property rights, i.e., parts of IP that can be protected, and other intellectual property that is created but cannot be protected. Intellectual property rights are patents, copyright, trade marks and designs and in some countries trade secrets (not shown here).

3 What is an invention? 3 NOKIA 2005 TUT ppt / / Kim Simelius At the heart of patent law lies the concept of an invention. A solution to a problem that has a technical function is the basic definition of an invention. Often people think that inventions are something big that will change the world forever. In reality, inventions are more often small improvements to existing technology, to overcome a problem in the design.

4 An invention sync Mailbox - Calendar Mailbox - Calendar sync Personal Folders- Calendar 4 NOKIA 2005 TUT ppt / / Kim Simelius

5 What Can Be Patented? NEW (not known before) INVENTIVE (not obvious from present knowledge) INDUSTRIALLY APPLICABLE (Repeatable, usable in industry, working, technical function) 5 NOKIA 2005 TUT ppt / / Kim Simelius In order for a technical solution to be patentable, it needs to be novel, inventive and industrially applicable. Novelty is always absolute: if something is publicly known by presentation, publication or common knowledge, it is not novel. For example, a wheel cannot be patented, since people have been known to use it for ages. Inventiveness is a relative concept: what is inventive cannot be defined absolutely, but is a case-by-case decision. Industrial applicability is simple: if the solution can be repeated and sold industrially, it is industrially applicable. For example, animals (as a rule) cannot be patented, since they are not "technical", and therefore not industrially applicable.

6 Prior known (prior art) What Can Be Patented? Inventive step Novel but probably not inventive enough Novel and inventive 6 NOKIA 2005 TUT ppt / / Kim Simelius The term "Prior art " is used to describe technology that is currently known. See, for example, the above wrench that has jaws in one end. Novelty and inventiveness are always compared to prior art. As novelty is an absolute concept, anything that differs from prior art is novel. However, inventiveness is a relative concept, and putting together two pieces of prior art is not inventive, unless it is done in a manner that e.g. produces unexpected advantages. Above, the double wrench may not be inventive as such, but if the jaws have a different span, it may be considered inventive. The last case, the adjustable wrench, is clearly inventive, since it differs significantly from prior art.

7 What Can Be Patented? Inventiveness The invention must include an inventive step over the prior art => The solution is not obvious to a person skilled in the art 7 NOKIA 2005 TUT ppt / / Kim Simelius The concept of "a skilled person" or "a person skilled in the art" is often used to determine whether the inventive step is large enough for the invention to be inventive in the sense of the patent law. The skilled person knows everything that has ever been described in a printed publication or patented, but has absolutely no imagination. An invention that differs from a single prior art document but is obvious to a skilled person can not be inventive. Of course, the invention can only be obvious if there exists a motivation e.g. in another document to modify the prior art so that it becomes the invention.

8 What can be patented? Exceptions to patentability Rules of games, plans, mental acts etc. Computer programs as such Diagnostic methods Some genetic material (humans) Subject matter against ordre public or immoral Are there really any exceptions? Why do exceptions exist? 8 NOKIA 2005 TUT ppt / / Kim Simelius The patentable inventions are defined very clearly in the patent law in most countries, and there is also case law to define the boundary more clearly. Some things are excluded from patentability to protect the public interest or restrict the patents to fields of technology (e.g., business method patents not allowed generally). In reality, the line is not that clear: companies try and tweak the limits of patentability, and case law defines the limits in unclear cases. Currently, a large debate is going on regarding the patentability of computer-implemented inventions in the EU.

9 What is a patent? A patent is the right given to the patent holder by the government nt Patent holder has the right to prevent others from producing using selling importing 9 NOKIA 2005 TUT ppt / / Kim Simelius A patent is a right given to the patent holder by the government. The patent holder can forbid others to produce, sell, import or use the invention. The right is in effect only in that country where the patent has been granted. For example, a manufacturing method for producing mobile phones can be patented in Finland, but the phones can still be freely made in Estonia and imported to Finland. Selling means any commercial exchange, whether it is to goods or money, and even sales promotion (marketing). When someone uses a patented solution, he is said to be infringing the patent.

10 How do you get a patent? National application, e.g., Finland or US Regional application, e.g., EP International application: PCT Years of prosecution of patent application Patents in effect are national patents 10 NOKIA 2005 TUT ppt / / Kim Simelius To get a patent, one must apply for a patent by submitting a patent application to the patent authorities. The patent application contains an abstract, figures, background, summary, detailed description and claims. The patent authorities examine the claims to make sure the patent is granted to something that is truly novel and inventive. The application can be examined in the national systems (FI, US, JP, CN ), regional systems (EP, ), or the PCT system (worldwide preliminary examination of a patent application). The granted patents are always national patents.

11 20 years The life of a patent invention invention disclosure to patent agent 1st official action application becomes public 18 months official actions max. 12 months 2-5 years patent application filed foreign filings (EP, PCT) 11 NOKIA 2005 TUT ppt / / Kim Simelius A patent gives the patent holder a right to stop others from using the invention starting from the day when the patent is granted up until 20 years from the application date. This grant date is often quite far from the application date - and 3 years is a long time in the telecom industry. The patents also give the patent holder a chance to licence out the invention for money, or to exchange licences (cross-licencing). A patent does not necessarily mean that you can use your own invention: others may hold relevant patents, as well. Neither can you keep things secret in a patent: patent applications become public in 1,5 years from the application date.

12 Using Patents Patents, in general, are company s weapons in the market place Defensive A means for challenging producers of pirate goods Enhance sales Become a part of a company s assets Enhance corporate image Offensive Prevent competitors from using patented technologies Prevent newcomers establishing themselves in the marketplace Give a return on R&D investment - licensing and royalties 12 NOKIA 2005 TUT ppt / / Kim Simelius The two most important uses of patents for a company is to protect its own R&D and to get licensing income (or to use the patents in cross-licencing to avoid costs). The patents also increase the market value of the company both through image and as assets - hence the term "immaterial property rights". Advanced products can also be sold at a higher price, and patenting the advanced features is therefore important. "Copycatters" are a nuisance in every field of business, but they can be stopped by using patents before they make too much revenue to become a real problem. Some companies also patent "just for the fun of it", that is, to make lives difficult for other companies and to create IP business for themselves.

13 What do companies patent? Working solutions from their R&D Own use (price differential) Licensing Future trends and concepts Own use Competitive edge Standard-related technical solutions Own use Licensing (price differential) Patent trolls Increase companies costs Licensing income 13 NOKIA 2005 TUT ppt / / Kim Simelius Own R&D results are patented to make sure that the products of the company cannot be copied right away and to license out good solutions that are not so crucial to business. Future trends and concepts can become valuable "milking cows" for the company Standard-related solutions are often patented, since others need to use the solution to make a standardcompliant product. This is especially true in communications technology. By anticipating competitor R&D, it is also possible to "destroy" competitor's R&D investment and extract value from competitor products. When a company has no products itself and uses this approach, it is called a patent troll.

14 Patenting Solutions for Own Products Protecting research and development investment Gaining a competitive edge for products (gaining and maintaining price differentials) Preventing others from stopping our products Preventing infringements and litigation Possibly obtaining licensing income 14 NOKIA 2005 TUT ppt / / Kim Simelius The main reason for patenting product solutions is to protect the R&D investment. Good solutions also make the product attractive to customers - a higher price can be asked for it. If the product is well patented, it is unlikely that others hold relevant patents for the product (patent knowledge). Activeness in patenting makes in unlikely to end up in court for infringement - in any case, the issue can be settled more easily if the company has a good patent portfolio. Solutions that are not crucial for product differentiation can also be licensed out.

15 Patenting Future Trends and Concepts Protecting research and development investment Conquering new markets, excluding others Possibly obtaining licensing income Becoming a technology leader Strengthening brand 15 NOKIA 2005 TUT ppt / / Kim Simelius Patenting emerging technologies gives a chance for the company to create a completely new market and dominate it longer than without patents. To increase the market size, concept patents may sometimes be licensed out, too. In any case, a company that holds patents for prestigious technology is easily seen as a technology leader (increasing sales). Naturally, the brand value is also increased by this.

16 Patenting Standard Solutions (beforehand) Protecting research and development investment Steering standards (reasonable licensing) Cross-licensing and licensing income Is this ethical? Obtaining Patents Revenue R&D investment Technical reliability Better standard solutions GSM 16 NOKIA 2005 TUT ppt / / Kim Simelius Developing standards requires a lot of R&D investments. Since the technology becomes widely available, it is important to protect the solutions. A holder of many essential patents for an open standard can also gain more control of the standard and the standard can be steered to the right direction by a reasonable licensing policy required for standard-related patents. The ethics of patenting standard solutions is sometimes questioned. However, since developing the standards (technical solutions) can not be done without money, it is likely that companies that patent a lot also contribute the most to the standards. These are the same companies that aim at making high-quality products. The whole circle - where patents are involved - leads to better standards.

17 Patenting Competitor Development Destroying competitor's R&D investment Obtaining licensing income (unreasonable terms) Blocking competitor products Is this ethical? Obtaining Patents Revenue Litigation costs (away from R&D) Technical reliability suffers Bad products, bad standards 17 NOKIA 2005 TUT ppt / / Kim Simelius Some companies try to extract money from the market by patenting alone. This happens through licensing income from the companies that operate in the market. Companies that hold patents bu that do not have production themselves can cause a lot of damage to the industry. The money that could otherwise be used to research and development is used for law suits, and everybody (except the patent holder and the lawyers) is worse off. Some countries even have laws to prevent such action. For example, if a patent holder for a medicine does not start manufacturing the medicine withing a certain number of years, the company may lose the patent protection. This is, however, very rare.

18 What kind of patents are there? Product patent: Motorola Flip-Touchscreen Concept patent: the Nokia Communicator Standard patent: Nokia "Smart SMS" - logos, tones, etc. "Competitor Development" patents Surely, nobody would do such a thing? 18 NOKIA 2005 TUT ppt / / Kim Simelius Below, four examples of different patents and patent applications are given. The number below each example is the patent document number. No exact explanations will be given about the inventions. Instead, the student is encouraged to at least briefly study the attached patent documents.

19 Patent: Flip cover and touchscreen Problem: taking the leads (wires) to a moving flip cover is problematic Solution: arrange the passive flip cover buttons to press a touchscreen, read the button presses from the screen 19 NOKIA 2005 TUT ppt / / Kim Simelius US

20 Patent: A two-part device Problem: a large screen and a keyboard is difficult to arrange on a small device in a reliable manner Solution: necessary functions (phone) on the outer cover, a large screen and a full keyboard become available when the device is opened 20 NOKIA 2005 TUT ppt / / Kim Simelius EP

21 Patent: Smart SMS (logos, tones, etc.) Problem: How to deliver small pieces of information to a user terminal in a usable manner Solution: Identify the target application in the message in a regular position incoming sms reading header information business cards ringing tones games IAP/Mail configuration 21 NOKIA 2005 TUT ppt / / Kim Simelius US

22 Patenting in the converging digital world Different fields of technologies are coming together in multifunctional devices and services digital convergence Old circle of competitors Nokia, Motorola, Ericsson, Lucent, Nortel, Alcatel, Qualcomm, Siemens, Matsushita, Sony, Samsung, New landscape of digital convergence NTT DoCoMo, AT&T, Vodafone, TeliaSonera,... IBM, Intel, TI, AMD, Transmeta, Microsoft, Sun, Borland, Oracle, TrollTech, MySQL, RedHat, Stanford, Sherbrooke, MIT, (TUT?) Patents come into play in new ways Manufacturers of disappearing industries (camera) Ex-manufacturers in highly competed industries (handsets) IP-businesses Patent trolls 22 NOKIA 2005 TUT ppt / / Kim Simelius Currently, a very large change in the business environment of consumer electronics is going on. Many companies are noticing they have a completely new set of competitors, who used to be in a different field of technology earlier. For example, the old telecoms club is coming to the common playground with computer manufacturers, software companies, operators, open source companies, universities etc. Who knows the rules of the new game? Probably nobody everyone is trying to shape the game and extract as much value as possible from the other players.

23 Patents in the international press current and past happenings Qualcomm and Nokia having patent disputes Nokia sues Vitelcom for infringement of GSM patents Patentability of computer-implemented inventions causes a mass movement in Europe Microsoft is ordered to pay 521 MUSD in damages to Eolas Amer Ltd. increases its profits by winning a patent suit Forgent networks claims to have a patent for JPEG image compression method (and sues the whole world) Immersion technology enforces its patents on force feedback game controls Polaroid wins a patent suit about instant cameras Lego and Xerox patents expire business in great trouble after monopoly breaks Nokia sued by Motorola for infringement of a number of patents Nokia starts to be active in patenting 23 NOKIA 2005 TUT ppt / / Kim Simelius Recently, a lot of high-profile patent lawsuits have seen the daylight. The damages ordered by the courts are going up, even the law is starting to change, a new type of business called the IP business is starting to emerge. Are we on the border of moving from real capitalism to IP capitalism, where intellectual property is more important than real property?