Everyone has heard the saying "You get what you pay for." When a patent is included in a standard, however, the Standards Development Organization (SDO) and would-be implementers of the standard have learned a variation on the old saying: "you have already gotten what you haven’t yet paid for, and now it’s time to negotiate." The promise of ex ante disclosures and negotiations is that the price and other material terms for use of an essential patent can be established (or at least capped) before the SDO and implementers have "bought" the technology by including it in the standard. Implementers (at least as they are represented by the SDO) will be able to make a conscious choice between price and quality.
Negotiating Royalty or Other License Terms Before the Standard Is Set
May 19, 2009
Everyone has heard the saying "You get what you pay for." When a patent is included in a standard, however, the Standards Development Organization (SDO) and would-be implementers of the standard have learned a variation on the old saying: "you have already gotten what you haven’t yet paid for, and now it’s time to negotiate." The promise of ex ante disclosures and negotiations is that the price and other material terms for use of an essential patent can be established (or at least capped) before the SDO and implementers have "bought" the technology by including it in the standard. Implementers (at least as they are represented by the SDO) will be able to make a conscious choice between price and quality.