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For a while it seemed the mobile industry was deteriorating into a battle over who had the best patents — and the best patent lawyers.
Apple was suing Samsung, Motorola was suing Microsoft and Google was in everyone’s cross hairs. And there were a lot more cases that weren’t making headlines.
However, a lot of that patent talk has died down in recent months. As the result of a key Supreme Court ruling and other shifts, the issue is starting to recede and the once sky-high valuations of patents have inched lower.
“I don’t think anybody is arguing values aren’t lower than they were before,” said John Veschi, CEO of Marquis technologies, speaking this week at a patent conference in San Francisco. “I think we can look back now and say, ‘Yeah, that was a bubble.’”
And Veschi is in a position to know, having been the man who helped spearhead the $4.5 billion sale of Nortel’s patent portfolio — an event some would say hit the high-water mark of patent valuations.
The value for a certain type of patents, known as standards-essential patents, has definitely declined, says Art Monk, a vice president for consulting firm TechInsights. These are the kinds of patents that contribute to a technology standard, such as Wi-Fi, Bluetooth or LTE. Companies with such patents stand to see their inventions widely used, but also have a commitment to license them on fair and reasonable terms.
“They used to be the highest value,” Monk said. “They’ve definitely gone down in value.”
Over the past couple of years, more patents are being overturned as part of a more extensive post-grant review process at the patent office. Various court rulings have also made it harder to get injunctions on standards-essential patents. Finally, the Supreme Court set new limits in a key case over software patents, known as the Alice decision.
The relative value of patents and the shifting landscape for intellectual property was a central point of discussion as lawyers from Apple, Google, Microsoft, Ericsson and Qualcomm joined peers from around the globe at the IPBCGlobal conference in San Francisco.
The view that the value of individual patents has dropped was widely held, though not universal.
“We don’t see that,” Ericsson Chief Intellectual Property Officer Kasim Alfalahi said in an interview. Ericsson is still involved in a couple of high-profile suits including actions against Apple and Xiaomi.
Google’s Allen Lo, who spoke on one of the panels, told Re/code that it’s more complicated than simply saying patent values have gone up or down.
“I think we’ve gotten smarter about what patents are worth,” Lo said on the sidelines of the conference. “I think good patents are still worth a lot. I think bad patents are worth less.”
Nor has the issue of mobile patents entirely faded from the scene. Just yesterday, Nokia said that Korea’s LG has agreed to license its cellular patents — the first major phone company to take a Nokia license since the company sold its handset business to Microsoft.
Google has been running its own experiment on determining patent values. Under its patent purchase promotion, started last month, inventors can offer to sell their patents to Google for a set price with the company pledging to give them an answer within 30 days.
“We haven’t sorted through the information yet, but we’ve learned a lot,” said Lo, who added that Google hopes to publish some of its conclusions over the next several months.
At the conference, a big debate was whether the dip in the patent business was a blip, a cyclical move or a permanent change.
Predicting where things go is tough in any industry, but one panel nonetheless tried to venture a guess as to how the landscape will have shifted again by 2020.
Boris Teksler, a former Apple patent licensing executive who testified in the Samsung trial, predicted that other industries will struggle the way mobile has — especially in the Internet of Things, payments and automotive markets.
“Those markets will undergo a drastic change,” he said.
Ericsson’s Alfalahi made the boldest prediction.
“There will be no litigation,” Alfalahi said, drawing huge laughter from the crowd of patent lawyers.
One audience member suggested that patent holders could be compensated not through licensing agreements but by new technology that actually tracked when the patented invention itself was used in a product.
Top Microsoft IP counsel Erich Andersen said it was an intriguing notion, but one he had never heard before.
Maybe the person who suggested it should have tried to patent it first.
This article originally appeared on Recode.net.
