Let’s talk stagnation. I’ve noticed lately that the rollout of 5G seems to have stalled. Yes, when I am in certain big cities my phone tells me I’m on 5G. But other than in those big cities, my phone always seems to be on 4G/LTE. Now, I know the arguments as to why 5G is supposed to be better. I know that 5G is supposed to be configured to natively carry data and so should be better, faster and more efficient at data transfers. I know that in one of its incarnations – one which not every carrier is doing - 5G uses a "standalone" architecture that fully splits the control plane from the user (e.g. data) plane. I know this also is intended to improve speed and efficiency, as well as the ability to control network functionality and improve network performance. And yet, in my personal experience, even when I am in places I know have standalone, fully split backend 5G implementations, 5G doesn’t seem to be any better, and often seems worse, than being on 4G/LTE.
I’m guessing I’m not the only one who feels that way. It appears that the 5G rollout is not making that much forward progress, even though the first 5G specification was released in 2017 (nearly seven years ago) and the rollout began in earnest in 2019 (nearly five years ago). There have been numerous articles about why 5G has stalled. Is it “rows over lampposts” as The Guardian argued.[1] Is it safety concerns?[2] Is it the frequencies being used?[3] Or is it simply that 5G is expensive, and that price tag is not warranted by (as my personal experience evidences) the relatively minor and incremental improvement 5G appears to represent over 4G/LTE.[4]
Whatever the cause or combination of causes, I see this lack of groundbreaking innovation for 5G in my licensing practice as well. There are a lot of portfolios that are being asserted against 4G/LTE, and as an add on, against 5G. But I have yet to see a single SEP portfolio being licensed of even moderate size that includes only 5G patents.[5] In other words, most of the SEPs that currently are being asserted against 5G actually date back to the development of 4G.
I was recently reading the IPlytics “Landscaping study on Standard Essential Patents (SEPs)” by Dr. Tim Pohlmann and Professor Dr. Knut Blind which was commissioned by DG GROW.[6] Their research established that standards with a lot of declared patents have more frequent small changes – “incremental” as the authors say - but less frequent significant, generational changes. This makes sense because, as a standard becomes loaded with SEPs, SEP holders that are making money by licensing their SEPs do not want to change the technology away from their money making SEPs. If those SEP holders come to dominate the development of the standard, there likely will be a lot of reuse of old technology. In those circumstances, even “new” patents are more likely to be for incremental improvements without a lot of groundbreaking technology.
That seems to be the case for 5G. In my experience, 4G/LTE has been the number one most asserted against standard and there are a lot of large portfolios that have been licensed to 4G/LTE implementers, sometimes for large or very large amounts of money. It is no wonder that these large SEP holders wanted to continue to make this money by incorporating their existing technology into the 5G standard.
Even for new 5G-only technology, there has been little change in which companies dominate SEPs for the standard. According to one published report, the top 10 SEP holders for 5G are nearly the same as the top 10 SEP holders for 4G:[7]
For 4G (in order from 1 to 10 according to the report): Huawei, Samsung, Qualcomm, ZTE, Nokia, LG Electronics, Datang Telecom, Ericsson, NTT and Sharp (now owned by FoxConn).
For 5G (in order from 1 to 10 according to the report): Huawei, Samsung, ZTE, Qualcomm, LG Electronics, Nokia, Datang Telecom, Ericsson, Sharp (now owned by FoxConn) and Vivo.
So, other than Vivo taking the number 10 spot for 5G and NTT dropping out of the top ten (to number 11) for 5G, there have been no changes to which companies are in the top ten slots.[8] These top SEP holders are all very large companies with the money, resources and knowledge to participate, contribute and achieve inclusion of their technologies into the standard and then to create a patent thicket to cover their incremental improvements.[9]
If there has been stagnation in the development and implementation of cellular standards with the same large companies dominating the standard for over fifteen years, and very little groundbreaking innovation during that period of time, where is the bulk of innovation coming from? It’s coming from implementers of all sizes, including startups. More and more innovative industries are using today’s cellular and Wi-Fi technologies in their products. But, most of these new and useful products are coming not from those who create communications standards, but from those who use those communication standards in their novel products.
For example, over the last few decades, car technology has improved dramatically. We now have driver assist features that reduce the risk of accidents; hybrid cars with regenerative braking; cars that replace polluting internal combustion engines with clean electric motors, batteries and charging technologies; electronic stability controls that make driving safer; navigation systems that help us get where we want to go; and evolving autonomous driving technology. There may be more connected cars these days – but the idea of connecting cars is nearly twenty years old and the use of modern connectivity in cars is in no way a novel idea. Instead, the novelty and societal benefits of this new car technology has resulted from inventions beyond that connectivity.
Similarly, many green-economy products use today’s current connectivity technologies but their true innovation, and the main societal benefits of their products, come from inventions other than connectivity. This includes new and improved photovoltaic “solar” products with better energy storage technology, energy saving appliances, smart lighting systems, improved wind turbines, electric vehicles, and better energy and water use reduction and monitoring systems.
The ultimate societal goal of standardization is the creation of new and useful products. As the IEEE states, the “core purpose is to foster technological innovation and excellence for the benefit of humanity.” In order to make that happen, we need to understand where innovation is coming from, and provide “a fair, and efficient, and transparent SEP licensing ecosystem”[10] that fosters that innovation. This means we must improve and rebalance the current licensing environment to reduce the burden of SEP licensing on innovators, particularly on green-tech and clean-tech innovators.
As the European Association of Automotive Suppliers (CLEPA) said in noting their support for the EU’s Proposal:
Standards such as 4G and 5G provide an important foundation for technological development. But innovation does not end with that. Companies such as CLEPA members invest, innovate, build and market next-generation products and must be permitted to build on top of standards under transparent conditions long before going to market so they may capture the value of their own innovations.
I cannot say it enough. The EU’s Proposal is a step in the right direction to rebalance and effectuate needed change to a system that everyone acknowledges is broken. I urge the European Parliament to move forward with its adoption.
[5] For example, the “Avanci 5G Vehicle” licensing program includes patents alleged to be essential to 2G, 3G, 4G and 5G. See, Avanci 5G Vehicle - Avanci
[8] And the top three SEP patent holders for 3G were, no surprise, Qualcomm, Ericsson and Nokia which, collectively, owned about 2/3 of all SEPs declared essential to 3G. 3G Cellular Standards and Patents (patentlyo.com)
[9] According to that same report, more than 35,000 patent families representing more than 105,000 issued patents have been declared essential to the 5G standard. That’s a lot of patents for a standard that, according to one of those major SEP holders, is based on the same underlying Orthogonal Frequency Division Multiplexing (OFDM), and operates “on the same mobile networking principles,” as 4G (see What is 5G? | Everything You Need to Know | 5G FAQ | Qualcomm). In other words, that’s a big patent thicket for a standard which, at base, is comprised of a hodge-podge of existing, often borrowed technologies. Among the existing technologies used in 5G that are mentioned in that article are orthogonal frequency division multiplexing “OFDM” (a technology used in 4G); device-to-device communication (long used in WiFi networking circles under the term peer-to-peer); and multi-hop mesh (another older WiFi networking technology). And there are other recycled technologies not mentioned in the article that also help form the foundation of 5G, including Multiple Input Multiple Output “MIMO” (used in WiFi for over a decade); small cell technology (used in some 4G implementations); the split plane architecture (already in the 4G backplane in a slightly different formulation and used in some other types of networks as well); and the list goes on and on.
[10] Remarks of Ms. Merete Clausen, Director for Investment for the Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs, about the EU’s SEP Proposal (starting around the time stamp 16:45:00): Committee on Legal Affairs - Multimedia Centre (europa.eu).