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Intellectual Property Law: The Driving Force Behind 5G

July 11, 2022
5G network with high speed motion blur

As the driving force behind 5G technology, intellectual property (IP) law is empowering innovators and businesses to collaborate with unprecedented global success. Protected by IP law, innovators are jointly developing critical 5G technology standards and deploying them at scale all over the world. In return for publicly disclosing their IP inventions, these innovators are granted the temporary exclusive right to license and profit from their intellectual property.1 This is a powerful motivation, considering the global smartphone “standard essential patent” or SEP-related royalty income for 2020 was approximately $20 billion.2

Read on to explore the exciting future of 5G as this life-changing technology is universally leveraged to connect everyone and everything, everywhere on Earth. We’ll also explore in greater detail the compelling, complex and lucrative relationship between 5G, intellectual property and IP law.

The Life-Changing Future of 5G Connectivity

Cellular technology standards are developed by member companies of the 3GPP consortium. Releases of a new series of standards typically occur around every 18 months, while new generations occur around once every 10 years. The term 5G represents the 5th generation of wireless cellular technology standards, as defined in 3GPP’s Release 15.3

The 5G technology standards enable significantly larger amounts of data handling due to greater bandwidth and lower latency than 4G.4 Forecasts for the next 5 years of global data traffic estimate that 50 percent of data handled will be generated without human interaction by connected equipment and devices such as industrial machinery, meters, sensors, robots, automotive vehicles, home appliances, medical instruments and healthcare equipment.

Additionally, as 5G technology replaces existing protocols around the world within the coming 15 years, experts predict 5G technology will contribute up to $2 trillion to the global economy.2

Everything will be connected in the life-changing future of 5G, from electricity grids, transport infrastructure, smart homes, offices, factories and hospitals to automated manufacturing, agriculture, driving and drone control. Online shopping, gaming and dating applications will become virtual reality experiences and sports events will feature multiple-camera 360-degree views of the action.1, 2

Dr. Kirti Gupta, Qualcomm’s vice president and chief economist, notes, “Those of us in the wireless industry do not think of 5G as simply the next generation or ‘G’ of wireless, but as a paradigm shift.” She explains, “5G is the kind of innovation that multiplies the productivity across various industries, not just mobile. Such technologies, known as general purpose technologies, do not come around often. Like electricity and the internet, 5G is an underlying infrastructure that gives a boost to every industry.”1

The Relationship Between Intellectual Property, IP Law and 5G

Intellectual property is the term used for inventions, artistic and literary works, symbols, designs, images and other creations of the mind used for commercial purposes. Examples of legal protections for intellectual property include copyrights, patents and trademarks. IP law gives the holders of patents, trademarks and copyrights the legal right to commercially profit from their works.5

Patents that inventors receive for intellectual property developed for use in 5G standardized cellular technology are called “standard essential patents” (SEPs). Individuals and companies participating in the 5G standard development process are bound by an agreement to license their SEPs on “fair, reasonable and non-discriminatory” (FRAND) terms.6

Unfortunately, many legal battles occurring in the cellular industry are fought over the FRAND terms of SEP licenses. Intellectual property patent holders fight to earn a reasonable royalty for their investment in R&D, while licensees fight for the lowest possible rates to improve their profit margins.3 As the licensing of 5G SEPs extend beyond the smartphone industry to all the other industries adopting connectivity, 5G SEP infringement and patent litigation are expected to increase, as well.2, 7

The Lucrative 5G SEP Licensing Market

The worldwide royalty income for SEPs in 2020 was estimated at an eye-popping $20 billion, and this figure essentially represents only smartphone SEP royalties. However, as the implementation of 5G stretches well beyond smartphones, market researchers are predicting a substantial increase in the compound annual growth rate of 5G SEP royalty income within the coming years.2

The widespread adoption of connectivity beyond the smartphone world means 5G implementers will be required to use hundreds of thousands of SEPs. Many SEP holders within the smartphone industry have publicly declared their 5G SEP licensing rates, but rates within such industries as automotive, energy, healthcare, home appliances, manufacturing and others are still unknown. Experts anticipate patent holders will monetize and enforce their SEPs and SEP portfolios, representing a stiff challenge for 5G adopters trying to maximize profit margins in this quickly expanding and highly lucrative market.2

Supporting Innovation With Stronger IP Laws

Dr. Kirti Gupta is a strong advocate for strengthening IP laws to protect the level playing field for individual inventors, startups and small businesses. “Without IP laws,” she warns, “only big and powerful companies—in some cases backed by governments—would have the ability to innovate. A world where future innovations are directed largely by large platform developers or states would create a less democratic, riskier, and poorer quality of life for everyone.”1

On the other hand, smaller companies and individuals are heavily dependent on IP laws to protect their IP rights as they promote their ideas to venture capital investors. As Gupta puts it, “Strong IP laws incentivize companies and inventors to invest in R&D and make the long-term bets that are necessary to create technological shocks, which will multiply economic growth over time.”1

Dr. Gupta also calls for strengthening international standards bodies, to support “a fair, rules-based ecosystem where innovators and companies from around the world can work together to advance fundamental technologies.” She explains, “To keep moving forward, we have no choice but to get it right, and the best way to do that is to strengthen IP protection and support continued innovation.”1

Become a Driving Force as a Leader in IP Law

If you’re interested in becoming a leader in intellectual property law, the Cardozo School of Law at Yeshiva University will expand your expertise and accelerate your career opportunities. Our top-ranking Online Master of Laws (LL.M.) in Intellectual Property prepares you for long-term success as a leader in IP law for such industries as emerging technology, data, privacy, entertainment and fashion.

U.S. News & World Report consistently ranks our 100% Online LL.M. IP Law degree in the top 10 best IP programs in the nation, and No. 2 in New York.8 Our world-class curriculum offers in-demand knowledge on copyright, patent and trademark law to refine your skills, empower your future and become a driving force as a leading intellectual property expert in the field of your choice. For more information, contact an Admissions Advisor to schedule an appointment.

Sources
  1. Retrieved on June 16, 2022, from venturebeat.com/2021/12/13/the-5g-innovation-economy-will-depend-on-a-strong-intellectual-property-system/
  2. Retrieved on June 16, 2022, from iam-media.com/article/who-leads-the-5g-patent-race-2021-draws-the-end
  3. Retrieved on June 16, 2022, from forbes.com/sites/tiriasresearch/2018/12/01/5g-ip-leadership-its-too-early-to-determine/?sh=19ed6e012126
  4. Retrieved on June 16, 2022, from pcmag.com/news/what-is-5g
  5. Retrieved on June 16, 2022, from wipo.int/about-ip/en/
  6. Retrieved on June 16, 2022, from managingip.com/article/b1twtv75vtknvq/5g-sep-leadership-in-2021
  7. Retrieved on June 16, 2022, from iam-media.com/who-leading-the-5g-patent-race-patent-landscape-analysis-declared-seps-and-standards-contributions
  8. Retrieved on June 16, 2022, from usnews.com/best-graduate-schools/top-law-schools/yeshiva-university-03103