Nortel Joins Qualcomm in Opposition to LTE Patent Pool
Does competition encourage or discourage development of LTE technology?
Last month a group of LTE product developers opted to come together to create a patent pool
for the technology. The goal of the patent pool is to reduce competition in the market, prevent lengthy and expensive lawsuits related to infringement and ultimately to get LTE products to the market more quickly. Suspiciously absent from the patent pool was Qualcomm, a company which faced significant losses after various patent infringement cases last year but which is sticking to its guns in favor of allowing individual companies to patent LTE technology. Another manufacturer, Nortel, has now joined Qualcomm
in opposition to the patent pool.
Nortel has instituted a one percent royalty rate to handset vendors who license Nortel’s LTE patents, a move which the company claims is designed to reward innovation in the industry. The underlying belief here is that a royalty encourages more rapid development of the LTE technology (which still isn’t even available in handsets). This view is in opposition to the view of the patent pool which believes that sharing information will lead to more rapid development of LTE products. It’s a case of debating whether competition in the industry spurs or stunts innovation and development.
I have nothing against patents... They serve their purpose, someone or an entity creates something, they should be compensated for it... However, what I do have problems with, is that some patents are so broad, they they encompass entire swaths of particular technologies, and that stifles innovation and competition. I kinda like the idea of a 1% royalty on handsets and such, its not excessive (while I actually do not like qualcomm in general, this is not a bad deal).
I see far more expensive handsets and LTE based technology if all the companies pool their patents, there will be less competition, which means higher prices for the consumers, and potentially less innovation.