Royalty Stacking and Standard Essential Patents: Theory and Evidence from the World Mobile Wireless Industry

2017 ◽  
Author(s):  
Alexander Galetovic ◽  
Kirti Gupta
Keyword(s):  
Mobile Wireless ◽  
Standard Essential Patents ◽  
The World ◽  
Wireless Industry

The case of the missing royalty stacking in the world mobile wireless industry

2020 ◽  
Vol 29 (3) ◽  
pp. 827-853
Author(s):  
Alexander Galetovic ◽  
Kirti Gupta
Keyword(s):  
Technological Progress ◽  
Average Rate ◽  
Selling Price ◽  
Mobile Wireless ◽  
The World ◽  
Order Of Magnitude ◽  
Essential Patent ◽  
Downstream Market ◽  
Standard Essential Patent ◽  
Wireless Industry

Abstract We build an equilibrium royalty stacking model that links the number of standard-essential patent (SEP) holders with the equilibrium quantity, price and cumulative royalty. We show that all observable implications of the theory are inconsistent with the data from the world mobile wireless industry. In this industry, the number of SEP holders grew from 2 in 1994 to 130 in 2013. Royalty stacking theory predicts falling or stagnant output, rising selling prices, and rising or stagnant quality-adjusted prices. By contrast, between 1994 and 2013 worldwide yearly device sales grew 62-fold, at an average rate of 20.1% per year, and both selling and quality-adjusted prices fell fast over time. Controlling for technological generation, the real average selling price of a device fell between -11.4% and -24.8% per year. Similarly, under conservative parametrizations, royalty stacking theory predicts royalty yields, which are more than an order of magnitude larger than the observed average cumulative royalty yield charged by SEP holders in practice, which hovers between 3% and 3.5%. A theory based on Lerner and Tirole’s (2015, J. Political Econ., 123(3), 547–586) within-functionality competition yields observable implications consistent with the observed facts. If all the technologies protected by SEPs have meaningful substitutes that cap the royalty that any SEP holder can charge, then the cumulative royalty is independent of demand parameters in the downstream market and can be as low as the observed average cumulative royalty yield. Moreover, if the product market is competitive and technological progress is fast, then prices follow costs, quality-adjusted prices protractedly fall, and sales grow fast.

Trends in the United States Mobile Wireless Industry and the Impact of a Merger of AT&T and T-Mobile on the Trends and Overall Competitiveness of the Wireless Industry

2012 ◽  
pp. 39-54
Author(s):  
John B. Meisel ◽  
John Navin ◽  
Timothy S. Sullivan
Keyword(s):  
United States ◽  
The United States ◽  
Federal Communications Commission ◽  
Electromagnetic Spectrum ◽  
Horizontal Merger ◽  
Mobile Wireless ◽  
Communications Services ◽  
The Impact ◽  
Competitive Forces ◽  
Wireless Industry

Thirty years ago, the United States Federal Communications Commission (FCC) gave birth to the mobile wireless industry by granting two licenses in each cellular geographic market across the United States. In the next three decades the FCC continually provided more access to the electromagnetic spectrum which is a critical input for the provision of mobile wireless communications services to, in part, promote a more competitive market structure in the mobile wireless industry. One objective of this chapter is to describe and analyze the trends in the overall competitiveness of the mobile wireless market during this time by utilizing a modified Porter competitive forces framework. This analysis will be supplemented with an analysis of the most recent proposed merger in the mobile wireless industry – between AT&T and T-Mobile. The proposed merger is an example of a continuing trend in the industry, consolidation of national mobile wireless carriers. This chapter will analyze the impact of proposed merger on the ability of the remaining mobile wireless carriers to constrain the market power of the national wireless carriers in the industry. Specifically, the arguments for and against the merger by major stakeholders are reviewed. There are signs that the mobile wireless industry may return to a duopoly structure. Recommendations regarding the horizontal merger will be offered.

scholarly journals Access to standard essential patents and antitrust enforcement: the case for licensing component manufacturers

2020 ◽  
Vol 82 (2) ◽  
pp. 19-33
Author(s):  
Rafał Sikorski
Keyword(s):  
Antitrust Enforcement ◽  
Contentious Issue ◽  
Standard Essential Patents ◽  
The World ◽  
Competition Rules

The ability to compete on numerous markets today depends on access to technological standards. When standards are protected by standard essential patents (SEP), a license to use such SEPs will be required. There have been numerous disputes in various jurisdictions over refusals to license SEPs. Most recently, disputes concern access to SEPs by the manufacturers of components. Some SEP holders deny access to their standard essential patents to component manufacturers and prefer to license end product producers. This practice has become a highly contentious issue around the world. In particular, manufacturers of components who are denied access to SEPs claim that such refusals amount to violations of competition rules. The author examines this highly contested practice is an attempt to show when denying access to an SEP license could harm competition.

scholarly journals New Trends and Advancement in Next Generation Mobile Wireless Communication (6G): A Survey

2021 ◽  
Vol 2021 ◽  
pp. 1-14
Author(s):  
Sher Ali ◽  
Muhammad Sohail ◽  
Syed Bilal Hussain Shah ◽  
Deepika Koundal ◽  
Muhammad Abul Hassan ◽  
...  
Keyword(s):  
Wireless Communication ◽  
Research Study ◽  
Next Generation ◽  
5G Networks ◽  
Mobile Wireless ◽  
Research Directions ◽  
Sixth Generation ◽  
Market Requirements ◽  
The World ◽  
Future Vision

As the commercial implementations of 5G networks have been initiated in different regions of the world, the focus of the researchers is bending towards the next generation of wireless communication. This research study intends to investigate the requisites of the fast establishment of the theoretical and practical measures for sixth generation (6G) wireless communication. To this end, this paper first outlined the existing research works that have considered different aspects of 6G, and then based on this existing works, the future vision is established. Then, the 6G vision is based on four types of connectivity and is summarized as “Wherever you think, everything follows your heart.” To fill the gap between the market requirements after one decade and the limited capabilities of 5G, different specifications of 6G that make it an appropriate replacement are discussed. Furthermore, different candidate technologies that can potentially realize the 6G communication are studied, followed by discussion on different challenges in the realization and possible research directions to cope with these challenges. By exploring the vision of future, its specification, and key candidate technologies, this paper attempts to summarize the general 6G framework. In addition, with mentioned challenges in realization of 6G, the aim of this paper is to guide the researcher and attract their interest to consider them.

Competition and Antitrust Enforcement Against Standard Essential Patents in India

2017 ◽  
Vol 62 (3) ◽  
pp. 447-452
Author(s):  
Samir Gandhi ◽  
Shivanghi Sukumar
Keyword(s):  
Intellectual Property ◽  
Property Rights ◽  
Intellectual Property Rights ◽  
Competition Law ◽  
Court Decision ◽  
Competition Authority ◽  
Antitrust Enforcement ◽  
Standard Essential Patents ◽  
The World ◽  
Competition Enforcement

Competition authorities and courts across the world have assessed issues at the interface between competition law and intellectual property rights. India is no longer a stranger to this debate and has witnessed the initiation of multiple proceedings involving the exercise of standard essential patents. Further, a long-pending jurisdictional conflict has now been resolved by a court decision, paving the way for the Indian competition authority and courts to concurrently examine the exercise of standard essential patents. While these developments represent a step in the evolution of antitrust jurisprudence in India, several foundational issues in relation to the competition enforcement against standard essential patents are yet to be decided.

Why Mobile Wireless Carriers Share Networks and Services Provisioning

2012 ◽  
pp. 178-211
Author(s):  
Hemant K. Sabat
Keyword(s):  
Business Models ◽  
Service Providers ◽  
Capital Investments ◽  
Service Provisioning ◽  
Mobile Wireless ◽  
The World ◽  
Infrastructure Investments ◽  
The Cost ◽  
Integrate Research ◽  
Network Sharing

This paper provides a theory that empirically examines why mobile wireless carriers share the costs of building networks and provisioning wireless services. Of the cost drivers of network operators, the most influential on the industry’s dynamics are capital investments, which include network infrastructure investments. As the industry evolves, players strive to streamline their services, applications, revenue, and business models to revive this industry. In this regard, one model in particular is the network operators’, which shares network investments and service provisioning expenses to reduce their total expenditures while strengthening their financial liquidity. In this paper, the authors integrate research results to provide a new theory on network sharing with concepts and viewpoints that have been developed based on extensive studies of network sharing adopted by network operators and service providers across the world during the past decade.

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