Latest trends in Intellectual property rights

  We are discussing “Introduction to Intellectual Property and Understanding Intellectual Property”. Among them, today we will look at “the latest trends in intellectual property rights”.

  The 21st century is often referred to as the age of knowledge creation. This has a thing to do with the recent trend in which the value as a commodity is shifting to intangible knowledge such as technology, design, and service used in the product rather than the product itself. In order for companies and countries to survive in this age of knowledge creation, it is necessary to understand the latest trends in intellectual property rights and prepare strategies for overall intellectual property rights.

1. Overview of Patent Disputes

  What is a patent right? It is a system that allows inventors to exercise exclusive rights to inventions in general. In the world as a whole, the cases of using the characteristics of these patents and exercising those rights are increasing. The beginning of this patent war can be attributed to the event that earned hundreds of millions of dollars in profits through Polaroid's patent rights in the 1990s. Since then, in the 2000s, patent disputes have intensified to such an extent that non-property entities (NPEs), which do not manufacture inventions and generate profits through patent license agreements and litigation, achieve rapid growth. It seems that global companies are dealing well in this era of patent war. A number of global companies are using patents as an important management strategy to maintain the market competitiveness of their products, as well as blocking the entry of latecomers into the market by creating an appropriate patent map. As such, as patents are regarded as independent business areas, it is clear that competition among global companies is increasingly turning into patent disputes. Below, we will briefly summarize the recent intensified LED and smartphone patent disputes.

2. LED Patent Dispute

  A light-emitting diode, that is, an LED, refers to a semiconductor device that emits light by passing an electric current. After the red LED was invented in the United States in 1968, LEDs of various colors have been developed. In particular, Hewlett-Packard of the United States, OSRAM of Germany, and Nichia of Japan are developing and producing white LEDs as indoor lighting fixtures. The size of the global lighting market was estimated to be about 100 billion dollars in 2008. And it is expected that the LED market will dominate the global lighting market, and thus patent disputes among related companies will also increase. Therefore, the patent competition between leading companies such as Nichia, OSRAM, Philips, and Hewlett-Packard and latecomers such as Seoul Semiconductor, LG Innotek, LG Electronics, and Samsung Electronics is on fire. In 2011, Seoul Semiconductor is in the process of litigation for patent infringement with Philips in Germany, the United States, and Korea. LG Electronics and LG Innotek and OSRAM are also in patent litigation in Germany, the US and Korea.

  In the case of LED, considering that the life cycle of technology is long, patent litigation takes a long time, and there is a possibility of evasive design products, it is not easy to inflict a significant blow to competitors through patent litigation. Nevertheless, it can be seen that the leading companies, which have most of the original technology patents, have a hidden intention to block the entry of latecomers into the market by dominating the patent war like this.

3. Smartphone Patent Dispute

  In the IT-mobile ecosystem that consumes apps, contents, and services based on cloud and mobile computing, smartphones serve as the first gateway that consumers encounter. In other words, consumers choose their favorite smartphone and enjoy the services and contents provided there. Therefore, global IT companies are risking their lives in various patent disputes to preoccupy an advantageous position in the smartphone market. Since cloud service usage fee revenue and mobile advertisement revenue are primarily determined in the smartphone market, patent wars between the IT industries are taking place at the same time.

  The smartphone patent war started with a patent infringement lawsuit between Apple and HTC in 2010, and has now been summarized as a confrontation between Android, represented by Samsung Electronics, and iOS, represented by Apple. Microsoft, Apple, and a Research Emotion consortium have acquired more than 6,000 wireless communication-related patents from Nortel, a solid Canadian telecommunications company, in various ways, putting pressure on manufacturers such as Samsung and HTC, which have chosen Google's Android as their operating system.

  In the market, patent disputes were mainly brought up by Apple. By filing a patent infringement lawsuit using patents such as interface and design as its main weapon, Apple has set out to check its competitors with wireless communication original patents. Since the smartphone has a short life cycle, Apple's strategy in this way is expected to be quite effective and damage its competitors. In addition, Apple attacked Samsung and HTC, which chose Android as its operating system, rather than Google, the inventor of Android. In response, Google sells some of its patents to HTC, helping HTC gain an edge in the patent race with Apple.

  As such, it is expected that the royalties to be paid by smartphone manufacturers will gradually increase due to heated patent disputes. As a result, it is expected that it will be difficult for small and medium-sized companies to participate in the market, where patent costs can be a huge burden. In addition, an increase in royalty costs will naturally lead to an increase in the price of smartphones. As such, patent disputes have a huge impact on the overall structure of an industry.

  Today, we learned about the introduction of intellectual property and understanding of intellectual property, especially “the latest trends in intellectual property rights”. Next time, we will study about “revision of US patent law”.

 

*I am a student learning IP, not an IP expert. Translation is also a translator and my short English skills. I hope it will be helpful for those who do not have the relevant knowledge or who want to learn about IP.

 

*The above is what I learned from a book compiled by the Korean Intellectual Property Office and Korea Invention Promotion Association (published by Pakmungak) entitled “Introduction to Intellectual Property, Understanding Intellectual Property”.