5G: Is It All About IPR?

Peter Jarich
Peter Jarich

About two months ago, I spent some time in this blog talking about 5G and what Mobile World Congress 2014 told us about the evolution of mobile broadband technology (MWC 2014: 5G – More Relevant Today Than You Might Think). The upshot? 5G looks to be an amalgam of many, diverse technologies and network features currently being developed – technologies that could well be implemented before 5G is officially a commercial reality: peer-to-peer architectures, broadcast, self-interference cancellation, deep virtualization, etc. As a result, “Today’s network investments will have far-reaching implications. Today’s network R&D will help to decide the 5G winners and losers.”

But how real is that last point?

Assuming 5G is, ultimately, built on “open” standards, then its implementation could well be divorced from early 5G R&D. You could be a super-successful 5G handset or infrastructure maker even if you’re placing all of the wrong 5G bets in the here and now, right? Not quite.

  •  R&D Takes Time. Eventually there will be some consensus of what 5G really is and what technologies it includes. Let’s call that point, “Day Zero.” You could begin working on those technologies when the clock strikes midnight on Day Zero. You’d immediately be behind those vendors who started their development two weeks, two months, or two years earlier. And even if customers didn’t want or need 5G solutions at Day Zero, those competitors would continue to develop their solutions, putting them at an advantage.
  •  Intellectual Property = More Than an Intellectual Exercise. Network vendors like to tout their patent portfolios and patent submissions. It’s like a badge of honor – a sign of just how innovative they are. But to a customer, it might seem irrelevant. “I don’t care how many LTE patents you own as long as you can deliver me solid, cost-effective products.” It’s a fair argument, but it shouldn’t obscure the fact that patents are big business to vendors. Essential patents put vendors in a position to extract licensing fees from competitors or at least give them a bargaining chip in negotiating licensing fees. No patents? Expect to be a net payor.

That “net payor” dynamic could, eventually, have an impact on the cost of a vendor’s product. The fact that relative 2G/3G latecomers Huawei and ZTE managed to build successful networks businesses, however, suggests this isn’t something for operators to worry too much about. Instead, as vendors continue the hype offensive around defining 5G, the real way to think about this positioning is much simpler and much more pragmatic. With 5G yet defined, every vendor wants to see it eventually be defined in line with their existing R&D efforts and intellectual property portfolios. In this way, it really is a battle for the future of wireless.

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