Stay Out of ATSC 3.0 Patent Licensing, MPEG LA, InterDigital Urge FCC

The June 22 rulemaking notice said the agency previously found it would be “premature” to impose regulations on 3.0 patent licensing in the “absence of any issues.” The notice asked if there have been any developments that would “warrant” the FCC imposing rules, what the regulations would require and on what commission authority such rules would be based. MPEG LA’s pool license is an “efficient licensing solution” for 3.0 patents, responded the license administrator. The commission “should not intervene to upset the free market forces that have made this possible and worked so well in the past to bring new and innovative products to consumers,” it said. “Doing so could very well skew the efficient licensing of critical products and delay distribution with no offsetting public value.”

MPEG LA debuted the 3.0 one-stop patent pool in January with 13 licensors (see 2201200058) with the goal of creating for 3.0 “what it successfully achieved for ATSC 1.0,” it told the commission. “Although we are not aware of any reliable study showing essential patents owned by parties who are not yet licensors to the pool, any party that believes it owns patents that are essential to the ATSC 3.0 Standard is invited to join,” it said. “We expect additional patent holders to do so.”

No government intervention or oversight “was necessary for this to happen, nor is any justified,” said MPEG LA. “Without any evidence of a problem to be solved, it would inject the Commission’s hand into areas for which it is neither needed nor required.”

The market, as with ATSC 1.0, “has once again risen to the occasion by voluntarily taking the initiative to address the need for licensing efficiency and reasonable licensing terms,” said MPEG LA. “With an excess of foresight and without prompting, essential holders have come together on their own to address the market’s need.” ATSC 3.0, unlike 1.0, “is not mandated by the Commission to be included in televisions, leaving its future entirely in the discretion of the market,” it said.

MPEG LA worries that FCC intervention “could arbitrarily treat different licensing platforms with varying oversight rules,” it said. Products and innovations would be delayed as parties “attempt to demonstrate why royalty rates for selected patents are ‘reasonable,’ how bundled essential and non-patents could be disaggregated (even as some may not read to the specific standard adopted by the Commission), and how ‘reasonableness’ would be calculated in non-pool licensing arrangements,” it said. Imposing licensing requirements on 3.0 entities, many of which are not U.S.-based and not regulated by the FCC, also could “immerse the Commission in lengthy jurisdictional issues with no corresponding benefits,” it said.

InterDigital encourages the FCC to “maintain the status quo and not attempt to regulate patent licensing” for 3.0, commented the R&D company. InterDigital, which owns and licenses 3.0 patents but does not belong to the MPEG LA pool, is aware of “no evidence of widespread (or even isolated) licensing problems suggesting the need for regulation” by the commission, it said. “Any potential disputes regarding the licensing of specific patents can be fully addressed through well-established mechanisms of the judicial system or arbitration.”

Without “compelling evidence of systemic patent licensing problems” unique to 3.0, attempting to regulate this market “is not necessary and may lead to unintended consequences, such as discouraging innovative technology firms from contributing to ATSC,” said InterDigital. The company bought the Technicolor patent licensing business three years ago for $150 million cash, including a portfolio of 18,000 patents and patent applications, many of them covering inventions involving wireless technology and audio and video codecs.

ATSC standards “have been a tremendous success, both historically and in the context of the ongoing 3.0 rollout,” said InterDigital. Standards such as those for 3.0 “rest on a critical balance,” it said. Enforceable patent protections enable the necessary investments to develop and contribute technology to these standards, it said. “Commitments to RAND licensing terms enable the investments needed to implement the standards at scale. Any attempt to regulate patent licensing would likely impact this balance and should be approached with caution and driven by real-world data.”