In the past decade, standard essential patent (SEP) licensors and implementers of connectivity standards have increasingly used litigation as an instrument in their negotiations with the aim to reach a more favorable deal to them. The wider use of connectivity standards in various IoT verticals means on the one hand that SEP licensors have to negotiate licenses for a broad range of different products with an increasing number of implementers, many of which are less familiar with standards and SEP licensing. Whereas on the other hand, implementers have to take licenses from an increasing number of SEP licensors for the different connectivity standards they may use in their products. If current licensing practices in the telecom sector are replicated in the various IoT verticals, the number of SEP litigations will increase even more over time. This chapter describes a holistic end-to-end solution aimed at creating a smoother SEP licensing ecosystem, in which licensors and implementers will be driven more towards negotiated agreements than towards using litigation to get to a deal. It addresses practical solutions for those elements in SEP license negotiations that are the cause of most litigation, including increasing SEP transparency, increasing the likelihood of the validity of SEPs, incentivizing implementers to seek SEP licenses, assessing a reasonable aggregate royalty for the total SEP stack, and securing a better level playing field among licensees.

Times are changing as our global ecosystem for commercializing innovation helps bring new technologies to market, networks grow, and interconnections and transactions become more complex around standards, all to enable vast opportunities to improve the human condition, to further competition, and to improve broad access. The policies that governments use to structure their legal systems for intellectual property, especially patents, as well as for competition—or antitrust—continue to have myriad powerful impacts and raise intense debates over challenging questions. This chapter explores a representative set of debates about policy approaches to patents, to elucidate particular ideas to bear in mind about how adopting a private law, property rights-based approach to patents enables them to better operate as tools for facilitating the commercialization of new technologies in ways that best promote the goals of increasing access while fostering competition and security for a diverse and inclusive society.