"FRAND and Standard-Essential Patents A critical component of this system is the licensing of standard-essential patents (SEPs) under fair, reasonable and non-discriminatory (FRAND) terms. 5G technology alone is projected to contribute approximately $13 trillion to the global economy. Realizing this value and ensuring continued investment into future standards requires an environment in which innovators can expect to recover their R&D expenditures and earn a risk-adjusted return."
"I presented what I refer to as the "inventor's equation": Expected Value of Innovation = Present Value of (Licensing Revenues - Probability-Weighted Cost of Holdout and Delay) When licensing frictions increase, whether through delayed negotiations, strategic holdout or rate uncertainty, the expected return on innovation decreases, discouraging future investment. Efficient, transparent FRAND frameworks reduce these costs, making R&D more economically viable."
Predictable intellectual property rights enable ideas to become legally recognized assets that can be collateralized or licensed to attract financing, fueling investment, job creation, and economic expansion. Licensing of standard-essential patents (SEPs) under fair, reasonable, and non-discriminatory (FRAND) terms is essential to capture value from large-scale standards like 5G, which projects approximately $13 trillion in global economic contribution. An "inventor's equation" frames expected innovation value as the present value of licensing revenues minus probability-weighted costs of holdout and delay. Licensing frictions such as delays, strategic holdout, or rate uncertainty lower expected returns and discourage R&D. Efficient, transparent FRAND frameworks reduce such costs and make R&D more economically viable. SEP royalties function to spread fixed R&D costs rather than to act as a tax on implementers.
Read at IPWatchdog.com | Patents & Intellectual Property Law
Unable to calculate read time
Collection
[
|
...
]