Certain companies, commentators and litigants and, unfortunately on occasion, government agencies repeat the following mantra: there needs to be “balance” between the interests of SEP owners and standard implementers in order to encourage standards development. This mantra includes the claim that innovative companies will not participate in standards development unless they are rewarded by the opportunity to make money through SEP licensing.[1] Yet, there is very little empirical evidence to support the view that licensing standard essential patents drives innovation, encourages innovative companies to participate in standards development or leads to better standards. This is the second in a series of pieces looking at what companies have participated in standards development over the years and whether they are implementers at the time of participation or SEP licensors.
My earlier post, Is SEP Licensing Necessary to Encourage SEP Development - Part 1 (sepessentials.com), reviewed the companies that participated in developing the 802.11/WiFi standard in the early days of development starting from the first plenary session in 1990 and also one in 1998. I chose those years because the first plenary session was in 1990 which was the start of the effort to create the 802.11 standard and 1998 was a pivotal year for 802.11. In 1998, the first version of the standard, 802.11-1997, had been released but had proved insufficient to ensure interoperability. The working group would not release a successful version of the standard until 1999. The early participants reflected in that post were involved in the most critical phase of the 802.11 development. They chose to participate when there was not an existing, functional standard and it was still uncertain whether the standard would ultimately be successful.
My first data point for the current post is 2010. 2010 was, for the most part, an unremarkable year both for technology and for the 802.11 standard. In 2010, the world economy was starting to climb out of the deep 2008 recession, but was still a bit in the doldrums. We still had a landline telephone at home and watched TV over a DOCSIS[2] enabled home cable modem. Netflix had launched its streaming service by then, but we were still getting Netflix DVDs through the mail to watch on our not-smart TV because streaming was still so slow.
The first Apple iPad was released in 2010, but we did not yet have one at home. The Apple iPhone 4 also was released that year and was immensely popular. Blackberry was still a player in the smartphone market but was already on a downhill slide, as were Motorola, Nokia and Ericsson's handset businesses. Qualcomm had long since sold off its handset business to focus on chips for mobile devices. Google released its first Nexus phone but had not yet acquired Motorola Mobility or launched the Pixel smartphone product family.
In 2010, I had a cell phone as did every other adult I knew, but they were not yet so ubiquitous that our children had them. It would be another five or so years before every teen and some of the tweens I know would have their own cell phones. Nonetheless, the airwaves were getting crowded with all these phones and the large service provides could not keep up with bandwidth demand.[3] It was still a bit unusual to use mobile data or browse the Internet on your phone but it was becoming more common.[4] Of course, these days, just about every cell phone is WiFi, Bluetooth, 4G/LTE, and often also 5G enabled and there are multiple ways to make voice calls and browse the Web on your smart phone.
Going back to 2010, AT&T was once again the largest telecommunications service provider in the world with Verizon Communications not far behind. The pure ISPs (Internet Service Providers) essentially were no more – everyone was getting their Internet service from either what had been their telephone company or their cable company. The cable companies had become the "MSOs" - multi-systems operators - because they offered the “triple play” of internet and telephone service (often VoIP based) alongside their traditional cable television offerings.
On the telecommunications and networking equipment side, by 2010, Alcatel had acquired Lucent and become Alcatel-Lucent S.A. but the merger was not going well. Ericsson was at that stage the world’s largest telecommunications equipment company followed by Huawei (which had not yet been banned from the U.S. market) and Cisco Systems.[5] There were a number of companies that were selling relatively inexpensive home networking equipment, including wireless access points that used the 802.11 standard. These days, Nokia owns Alcatel-Lucent and Huawei has become the world's largest telecommunications equipment supplier with Nokia (after its Alcatel-Lucent acquisition) and Ericsson neck and neck for second place.[6]
802.11n (WiFi 4) was released in 2009[7] and, in 2010, the 802.11 working group was focused on developing the version that later became known as 802.11ac (but 802.11ac’s release was still several years off: it was not released until 2013). 802.11n was a relatively significant update to the 802.11 standard. It introduced the use of MIMO (multiple input multiple output) to the standard and made additional changes which, together, increased the speed of transmission by an order of magnitude.[8] 802.11n became a really successful version of the standard and the use of WiFi became much more ubiquitous. Of note given the current geopolitical issues, 2010 was the first year that the 802.11 working group had a meeting in the People’s Republic of China.[9]
The most recent version of the standard was released in 2021 and is called 802.11ax/WiFi 6. The working group currently is working on the development of 802.11be/WiFi 7 which is sometimes titled, Extremely High Throughput.
On the patent litigation side, by 2010, patent lawsuits were increasingly being filed by non-practicing entities, the volume of patent cases/number of defendants had skyrocketed (as compared to 1998) and the Eastern District of Texas had become the venue of choice. These days, the Western District of Texas is neck and neck with the Eastern District of Texas as the U.S. venue of choice for non-practicing entity suits with some suits returning to California after the U.S. Federal Circuit tried to stamp down on the Eastern District’s overreaching. After a small dip several years ago, the number of patent cases filed in the United States each year is holding relatively steady at a relatively high number.[10]
I witnessed all of this during my time at Cisco. When I started at Cisco in 2005, Cisco was involved in about 6-8 patent lawsuits. By 2010, at any given time, Cisco was involved in about 50-60 patent lawsuits, nearly all filed by NPEs in the Eastern District of Texas. These days, NPEs are aiming for large users such as service providers and high-volume selling entities (handset makers for example). Consequently, as of 2023, Cisco has become a less frequent direct target (but still more frequent than when I started in 2005), but the number of cases against Cisco's customers remains high.
So with that background in mind, here are the attendees of the IEEE 802.11 plenary meeting held in Orlando, Florida on March 14-19, 2010 as recorded in the meeting minutes and the plenary meeting that took place in Atlanta, Georgia on March 12-17, 2023 as recorded in the meeting minutes. You can find the minutes here, SUMMARY REPORTS & MINUTES OF 802.11 WG SESSIONS (ieee802.org). Please note, the number of attendees in 2010 had risen quite substantially over the 1998 numbers, and 2023 continued that upward trend. The table is consequently very long.
Note that I have added/changed some categories as compared to my previous post. For example, I have added IoT and government entity, and have changed defense contractor into defense/government contractor. It has become apparent that these categories are not truly adequate to classify the burgeoning types of participants as of 2023 but nonetheless here they are:
· Component part supplier: companies that provide component parts (other than semiconductors) to equipment manufacturers.
· Defense/government contractor: company whose primary business is making specialized products for the U.S. and other militaries, and/or selling products to government agencies.
· Government entity: exactly as it sounds
· IoT: a company whose primary business is selling Internet of Things, ConnectedHome, smart meters or similar devices.
· Networking equipment: a company whose primary business is equipment for networking.
· Semiconductor: companies whose business is solely or primarily to design and/or manufacture semiconductors. Often called “chip companies”
· NPE or “non-practicing entity”: an entity (a) whose primary business is licensing patents and (b) which never had a product business or which at one time had a product business but that product business is essentially kaput (this latter category I sometimes call “once were companies”).
· Organization: a non-university government or partially-government sponsored organization or non-governmental organization (“NGO”).
· Other: for companies that do not fit into any of the other categories.
· Telecommunications equipment: a company whose primary business is equipment for running telecommunications (cellular, landline, satellite) networks and which may also sell networking equipment.
· Telecommunications service provider: company whose primary business is providing telecommunications services (which includes one or both of cellular and wireline telephone services, and might also include the provision of Internet access but is not limited to the provision on Internet access).
· University: just what it says.
· User device: a bit of a misnomer since many of the companies labeled user device provide business/enterprise level products, but this term is intended to denote a company that provides products that are usually used by one person at a time and often can be handheld. This category runs the gamut from phones to computers to audio equipment to RFID devices and handheld scanners. This is the broadest category and so I’ve tried to indicate the main types of devices sold by that entity in the relevant time period.
· WLAN or Wireless LAN: a specialized type of networking equipment company with a focus on equipment to wirelessly connect nodes within a local area network. Technically, 802.11 is a form of wireless LAN.
[1] See for example: EC’s proposal for regulation of SEPs is flawed | Nokia (“Nokia is a major inventor and an implementer of standardized technology, and we therefore support a balanced approach to SEP licensing that both incentivizes inventors and provides predictability to companies that license the use of another company’s inventions.”); Securing Intellectual Property for Innovation and National Security (csis.org) (“Indeed, devaluing SEPs would have severe consequences for innovation and for the United States and its allies more broadly . . . “In a market-based economy, the ability to monetize IP rights through licensing them successfully is an important mechanism that enables firms to invest in the risky research and development (R&D) required to lead in global standards.”); Patents and licensing: Investing in technology innovation (ericsson.com) (“Compensating innovative companies through patent royalties and on FRAND terms allows them to reinvest in the newest generation of technology, and unlock the most advanced digital experience for all of us. This is central to continuing to incentivize companies to contribute their best engineers’ time and creating standards of the future”).
[2] DOCSIS or the Data Over Cable Service Interface Specification is a standard developed primarily by what used to be called the cable companies that specifies a protocol for transferring data over (hybrid) coaxial cable. By 2010, DOCSIS supported numerous IETF standards including IPv6 functionality (although it had not been completely rolled out in 2010) and IP multicast as well as NIST’s standardized AES encryption standard.
[7] Sometimes, some companies begin implementing a standard before the official version is adopted. This happened with 802.11n because it took so long from quasi-completion to adoption as a standard. Thus, although 2009 was the formal release date, there already were products in the market implementing the pre-release version of the standard before then. See, Wi-Fi Alliance® to Certify Pre-Standard IEEE 802.11n Products Next Year | Wi-Fi Alliance.
[9] With the exception of a few of the very early years (1991, 1993), the height of the dot com bust (2001) and the Covid years (2020 and 2021), the working group has had at least one meeting (interim or plenary) each year in a venue outside the United States. 2010 was the first year in which a meeting was held in the PRC. From 2010-2016, there were a total of 11 meetings of the working group held in the PRC. 2016 is the last year that an 802.11 plenary or interim meeting was held there. See SUMMARY REPORTS & MINUTES OF 802.11 WG SESSIONS (ieee802.org).
[10] You can see some of the trends on increased patenting (as I mentioned in the first 802.11 post) and lawsuits, as well as other trends such as the rise of patent litigation investment entities, in some of the following documents: 201603_patent_litigation_issue_brief_cea.pdf (archives.gov); https://www.iam-media.com/article/9C1BED120E1837C382AB97FB48DC04E77AE30336/download; Guest Post: Counting Defendants in Patent Litigation | Patently-O (patentlyo.com); Rising to the Top in a Post-Pandemic IP World: A Look at the Most Active Patent Litigators and the Latest District Court Patent Litigation Data (ipwatchdog.com); At least 25% of the last 3 years NPE litigation caused by Litigation Investment Entities (LIEs) — Unified Patents.
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