Over the last two decades, telecom industry has been one of the major money-spinner markets across the globe. From “feature phones” built primarily for the purpose of making and receiving calls to “smartphones” capable of overpowering computers, the journey has involved a lot of innovation and patent rights have played an important role in protecting those intellectual breakthroughs against unfair use.
Back in 2007, Steve Jobs introduced the world to iPhone, which revolutionized the way the world communicates. The company that started as Apple Computer Inc., later changed its name to Apple Inc. as the iPhone sales took over all the product lines that the company offered prior to the iPhone. Since then, the company has embarked its name among the big sharks of the smartphone industry, and has actively pursued protection of its technology, including iPhone. Apple has filed a number of patents to protect iPhone, which runs into 100s. Looking closer at the patents filed by Apple, we observe that the company has a carefully crafted IP strategy for IP filing, the company seems to believe in an all-round protection, i.e. filing patents to protect the technical aspects and filing designs for protecting the aesthetic aspects of the iPhone.
The company not only filed patents, but actively enforced them as well. Back in time, Apple sued Motorola and HTC over the infringement of its “slide-to-unlock” feature being used on their phones. Then came the seven-year long Apple vs. Samsung battle which saw its end recently with a settlement between both the companies in which Apple was paid an undisclosed amount, but for sure a small fortune, by Samsung.
Not only Apple, other industry leaders for example, Qualcomm, garnered a monopoly over competitors for six long years as being the sole supplier of communication modems for Apple Inc. in return for an offer of decreased licensing prices for their patents.
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The protection to the innovation sphere provided by the patent rights has brought us from the slow-paced phase of 2G communication to the point where the testing of 5G communication has already started in some countries. Companies have been able to invest in the R&D of the wireless technology solely because of the protection and guarantee of economic returns offered to their innovations by these patent rights. In fact, at the point where Nokia lost its monopoly in the cell phone market, the only thing that kept its boat sailing were the revenues generated from the licensing of patents it had filed over the years.
Whether the enforcement of these protection rights paves the path for innovation and fair competition or encourages abuse of ownership by the big companies has always been a key question among critics. But, in lieu of the above scenarios and general statistics, it can safely be said that patent rights have played a substantial role in the growth of the smartphone industry and will continue to water this perennial sector of innovation.
This article is written by Amit Aggarwal is the Co-Founder and Director of Effectual Services