"It is recently announced that Avanci has signed a patent license agreement with Japan's Toyota, Nissan, Honda, and Stellantis, these car brands, including their covered brands of connected vehicles, will have access to 2G, 3G and 4G basic patent licenses under the Avanci Automotive Patent Program. The licenses come from all relevant patents of 51 patentee and future ones joining the patent pool."

On September 21, the Avanci patent pool and the European car dealer Stellantis Group (including Peugeot, Citroen, Opel, Chrysler, Dodge, Maserati, Lancia, Fiat, etc.) and around a dozen Japanese automobiles such as Toyota, Honda, Nissan, etc. Companies signed patent licensing agreements. It’s the first time Japanese automakers agree to pay such licensing fees, making it a sign that there will be a possible shift in their approach to patents.

That is to say, connected vehicles that pay royalties for connected car components will obtain 2G, 3G and 4G basic patent licenses for Avanci's automotive patent program, including all relevant patents of 51 patentee and future ones joining the patent pool.

Meanwhile, the Avanci patent pool issued an official statement that the 2G, 3G and 4G licenses of this patent pool now have covered more than 80 auto brands in the industry, with more than 100 million connected vehicles having Avanci's patent licenses. What is also mentioned is that next year, 30 to 40 million connected vehicles are expected to join the licensing group of the patent pool.

Reported by Reuters, some controversy has been arisen because the Avanci patent pool adjusted 4G patent licensing prices, suppliers and technology companies disagreed with who should bear the license fees. In May 2018, Avanci publicly stated that no matter how many licensors will be added, the license fee for external launches remains fixed. However, Avanci now charges a flat license fee of $20 per vehicle, up from that of $15 earlier this month.

As mentioned in Avanci's IoT white paper, IoT has been providing power for an unprecedented new and evolving product economy, with more than 41 billion devices expected to be connected to IoT platforms by 2025. In view of the particularity of the SEP till now, it is hard to obtain injunctive relief even if the patentee wins the case. At the same time, Avanci holds about 70% of the world's SEP, which means that car manufacturers can greatly avoid the risk of patent infringement after entering the pool; though other SEPs outside the pool still need to negotiate with the patentee, but actually it has dramatically increased the cost of responding to litigation.

With the patent operations platform Avanci, automakers can have patents on 2G, 3G and 4G technologies from companies such as Finland's Nokia, Sweden's Ericcson and Taiwan's Acer, for various use from navigation systems to sensors for autonomous driving. And with Renault, Stellantis Group and Honda ‘s joining into the patent pool, 80% to 85% of 2G and more advanced technologies will be included in the licensing scope of the platform. On the other hand, licensors in the Avanci patent pool retain full ownership and control over their patents, such as bilateral licensing methods and prices. According to Laurie Fitzgerald, the senior vice president of Avanci, all of the company's current direction are for the planned 5G connected vehicles project. With the continuous implementation of new contracts covering 5G patents, there will be an upside potential for the fixed fee of patent portfolios in the future.

From the date of its establishment on September 15, 2016, Avanci has been stick to the whole vehicle licensing model (Pro-patentee) in the field of litigation in Germany and the United States for 6 years, thus conquering a number of automobile companies. In 2019, Avanci appointed Sharp, Nokia and Convinson to file a litigation against Daimler in Germany. In June 2021, a German court judged that Daimler infringed and issued an injunction prohibiting the sale of Daimler cars in Germany. Daimler respectively settled with Sharp and Convinson in October 2020 and April 2021, signing the bilateral licensing agreements. Since then, the recognition of the whole vehicle licensing model in the Germanvehicle market has been substantially promoted.

The transformation of the communication industry to the licensing of the intelligent terminal industry usually comes with huge costs, making the SEP based on wireless communication standards unique and irreplaceable compared with the general patent rights, it is easy to expand from the using influence of core patents to the sales market of core patents. Although Huawei and Samsung are essential patent holders, they are also major auto parts suppliers that is contrary to Avanci's vehicle-level charging model. Moreover, for Huawei and Samsung, the component-level licensing model (Pro-implementer) tending to patentee is more beneficial to maximizing their own interests in the competition with other component suppliers.

From IPRdaily

September 26th, 2022