Market forces can determine RAND royalty rates for standard essential patents such that (a) the standard is rapidly adopted, (b) royalty rates are accepted by the majority of users without need for litigation, and (c) royalty rates are transparent and non-discriminatory.
PublicationsIntellectual Property Licensing
Review of the book “Why Startups Fail” by Thomas Eisenmann. Data from Eisenmann’s survey suggests that lack of proprietary intellectual property plays a role in the failure of startups. Survival is harder when IPR doesn’t protect the first-to-market advantage.
Developers of standards don’t like it when a patent owner blocks the use of their standard. The considerable effort that goes into developing a standard, typically hundreds of man-years, is wasted when that standard is not used.
The availability of historic data on the sales volume of Wi-Fi and CD-Recordable makes it possible to estimate the effect of patent royalty payments on the adoption of standards.
Comparing different methods that have been tried to determine the RAND royalty rate for a subset of all essential patents, and suggesting a method that is based on each patent’s contribution to generating license income.