2g & 3g mobile communication

2G & 3G Mobile Communication

© iRunway 2013 Confidential of 26

Contents

1 Executive Summary ................................................................................................................. 3

2 Introduction ............................................................................................................................. 4

2.1 Overview of 2G & 3G Technology ............................................................................................................... 4

2.2 Technical Highlights of 2G & 3G .................................................................................................................. 4

2.3 Comparative Study of 2G, 3G & 4G-LTE ...................................................................................................... 5

3 Analysis of the 2G & 3G Patent Landscape ............................................................................. 7

3.1 Patent Categories & Distribution ................................................................................................................ 7

3.2 Top Patent Holders ...................................................................................................................................... 7

3.3 Analysis of Seminal Patents ......................................................................................................................... 9

3.4 Analysis of Standard-Essential Patents ..................................................................................................... 12

3.5 Patent Filing and Grant Trends .................................................................................................................. 14

4 Key Players in the 2G & 3G Patent Landscape ...................................................................... 15

4.1 Ericsson ...................................................................................................................................................... 15

4.2 Nokia .......................................................................................................................................................... 16

4.3 Qualcomm ................................................................................................................................................. 17

4.4 Alcatel-Lucent ............................................................................................................................................ 18

4.5 Samsung .................................................................................................................................................... 19

5 Monetization of 2G & 3G Patents ......................................................................................... 20

5.1 Potential Licensing & Litigation of 2G & 3G Patents ................................................................................. 21

6 Glossary of Terms .................................................................................................................. 24



1 Executive Summary

Emerging technologies such as 4G-LTE attract the lion‟s share of industry and media

attention. However, 2G and 3G wireless networks remain highly relevant, currently

supporting over 80% of all mobile phone activity. Trends suggest the use of 2G and 3G

technologies will expand dramatically during the next three to five years as the world‟s two

largest markets, India and China, open their doors wide to mobile phone usage.

Ericsson, Nokia, Qualcomm and Alcatel-Lucent are among those who developed the building

blocks of today‟s wireless world. They collectively control the majority of all patents in this

space. Nokia, LG Electronics and Qualcomm alone own more than 43 percent of all

“seminal” patents (i.e., determined to be strong based on a set of parameters). The playing

field has evolved dramatically in recent years, causing these brands to slowly fade from the

minds of consumers. However, they will continue to exert an influence on current market

leaders such as Apple, Google and Samsung, who control today‟s mobile device ecosystem.

2G and 3G technology patents have been at the center of ongoing patent wars and they can

be expected to fuel a significant escalation in activity during the next five years as top

patent holders seek to monetize their portfolios. Leading patent holders have already

launched initiatives against major competitors, with some having sold patent rights to

various companies. It is highly likely, given the increasing pressure on these companies to

generate revenue, that many will become more aggressive by entering into new agreements

with “patent privateers” to monetize their assets. The result will likely be an increase in

litigation and licensing.

So, who stands to benefit in this evolving marketplace? Which companies control the largest

number of patents and the largest number of seminal patents in the world of 2G and 3G

technologies? Which companies are best positioned to leverage monetization efforts? These

are some of the questions addressed in this report.

We explore key 2G and 3G patent holders, providing details on the number and category of

overall, standard-essential and seminal patents. The report delves into companies that

control a large percentage of seminal and standard-essential patents. Nearly nine percent of

seminal 2G and 3G patents are currently held by certain companies, and approximately five

percent of all standard-essential patents are held by two companies - Innovative Sonic Ltd.

and Vringo Infrastructure Inc. This report also reveals that these companies that hold key

2G and 3G patents have remarkably high patent monetization potential.



2 Introduction

2.1 Overview of 2G & 3G Technology

2G was commercially launched in 1991. It introduced digital signaling via packet data in

telecommunications, and provided reduced power consumption and noise levels. It also

proposed better security methods with digital encryption techniques coupled with lower

power usage. SMS, MMS and e-mail were a few packet-based services introduced by 2G.

Although highly advanced markets have reached a stage where 2G networks are now being

switched off, 2G technologies still account for over 80 percent of connections in China and

90 percent in India - the two largest mobile markets in the world.

With successive technologies such as 2.5G, 2.75G and 3G, the era of ever-increasing data

rate demands skyrocketed across the globe. While packet data was introduced in 2G, higher

data rates and better data services were brought by 3G. Attractive services such as Mobile

TV, Video on Demand, Video Conferencing, Location-Based Services and Global Positioning

System (GPS) gradually grew into a necessity for a majority of mobile users. Statistics1

suggest that, as of 2012, more than 500 operators across 185 countries have deployed 3G

networks, pointing to the fact that mobile users in more than three-quarters of the world‟s

markets have access to 3G services.

2.2 Technical Highlights of 2G & 3G

The 2G Advantage

Lower power consumption, better security and better bandwidth usage are the key

advantages of 2G over its precedent technologies. 2G introduced digital encoding in

telecommunications, resulting in better compression and multiplexing of voice data than its

preceding analog encoding. The advantage: 2G supported a larger number of calls in the

same radio bandwidth and ensured lower power consumption that improved battery life in

mobile phones.

Digital encryption methods introduced in 2G provided better security and privacy to mobile

users. Short Message Service (SMS) and Multimedia Message Service (MMS) became the

first form of packet-based services introduced in 2G, marking the beginning of data services

on mobile phones.

1 https://gsmaintelligence.com/analysis/2012/11/half-of-all-mobile-connections-running-on-3g-4g-networks-by-

2017/359/

https://gsmaintelligence.com/analysis/2012/11/half-of-all-mobile-connections-running-on-3g-4g-networks-by-2017/359/

https://gsmaintelligence.com/analysis/2012/11/half-of-all-mobile-connections-running-on-3g-4g-networks-by-2017/359/



The 3G Advantage

3G entered the market with the advantage of increased data rates available to mobile users

for services such as Mobile TV, Location-Based Services, video calls and internet browsing

on the move. It also provides variable data transfer speeds ranging from 128 kbps to 3

mbps depending on the speed with which the mobile device is moving within the network.

Beyond mobile telephony, the higher speeds allowed 3G connections in PCs, gaming

consoles, tablets and any other portable device that could benefit from a faster and higher-

quality internet connection. 3G also provides users with better security through user

authentication capabilities when communicating with other wireless devices.

3G boasts of better power control methods for both uplink and downlink, with the network

using a target Signal-to-Interference Ratio (SIR) to adjust its output power. It also

improves spectrum utilization through shared channels in the radio interface, thus making it

more effective than 2G networks.

2.3 Comparative Study of 2G, 3G & 4G-LTE

2G 3G 4G-LTE

Services

Introduced

Data services such as

text messaging

(SMS), multimedia

messaging (MMS),

internet access & SIM

cards.

Term „mobile

broadband‟ introduced

because of its speed &

capability.

Universal access &

portability across

different device types.

High definition

streaming & IPV6 support.

Throughput/

Speed 9.6/14.4 Kbps.

3.1 Mbps (peak)/

500-700 Kbps.

100-300 Mbps (peak)/

3-5 Mbps.

Technology

GSM - Global System

for Mobile

Communication with

technological

backbone of TDMA

(similar to FDMA).

UMTS as its core

network architecture

with HSPA protocol.

E-UTRA (Evolved UMTS

Terrestrial Radio Access)

as the air interface for

LTE. Additionally, uses a

technology

called MIMO where the

modem uses two separate

antennas simultaneously



to deliver super-fast

speed.

Standards GSM, GPRS (2.5G) &

EDGE (2.75G).

UMTS & CDMA-2000

standards.

Multiple radio standards

unified into a single IP

network.

Voice & Data

Support

Voice & data could

not be simultaneously

supported.

Simultaneous voice &

data support.

Simultaneous voice & data

support at higher data

rates.

Switching

Techniques

Consists of only

circuit-switched

networks.

Uses a combination of

both circuit-switched &

packet-switched

networks.

Uses only packet-switched

networks, thus lowering

latency and enhancing call

quality.

Frequency

Band

Initially 900MHz

spectrum was used,

but later GSM was

introduced on an

1800MHz band.

1.8 – 2.5 GHz. 2 – 8 GHz.



3 Analysis of the 2G & 3G Patent Landscape

3.1 Patent Categories & Distribution

Around 17,268 U.S. patents have been granted in the 2G and 3G domain. The following

technology categories were identified based on our analysis of the patent landscape:

Level 1 Categories Level 2 Categories Number of U.S.

Patents

Communication Quality (3840)

Backhaul Network 2886

Congestion Control 577

Handover 377

Data Transfer Rate (3871)

Error Control 437

Link Adaptation 304

Shared Traffic Channels 1758

Spreading Codes 942

Transmit Diversity 430

Positioning (1576)

Network Based 292

User Equipment Assisted 1102

User Equipment Based 182

Power Management (1829) Continuous Packet Connectivity 1197

Power Control 632

Security (4714) Access Control 1648

Encryption 3066

Services (1438) Location-Based Services 139

Value-Added Services 1299

Table 1: Level 1 & Level 2 technology categories with number of granted U.S. patents

3.2 Top Patent Holders

The top companies in the 2G and 3G landscape with respect to their portfolio size are shown

in Figure 1.



Figure 1: 2G & 3G Patent Distribution of Top Companies

(Source: iRunway analysis based on patent data from USPTO)

* The patent portfolio previously owned by Nortel Networks was acquired by Rockstar

Consortium, a patent licensing company that owns and manages a portfolio of more than

4,000 patents.

Table 2 shows the distribution of patents for the top companies across categories:

Company

Patent Distribution across Level 1 Categories

Comm.

Quality

Data

Transfer Rate Positioning

Power

Management Security Services Total

Ericsson 274 415 94 241 269 211 1504

Nokia 213 272 163 196 381 138 1363

Qualcomm 135 230 108 211 203 28 915

Alcatel-Lucent 229 195 25 83 161 100 793

Samsung 162 299 27 37 84 44 653

AT&T 182 30 33 31 267 95 638

Research in Motion 14 72 12 24 464 12 598

LG 26 387 55 30 57 29 584

Cisco 158 2 7 14 300 7 488

InterDigital 31 300 8 88 29 6 462

Motorola Solutions 58 57 37 74 87 40 353

Nortel Networks* 114 56 32 36 73 35 346

Total 1596 2315 601 1065 2375 745 8697

Table 2: Patent distribution of top companies across Level 1 categories

15041363

915793

653 638 598 584488 462

353 346

0

400

800

1200

1600N

o. o

f Pa

ten

ts



Figure 2 below displays the technology evolution tree for the Level 1 categories, with each

circle representing the number of patents filed in the corresponding year in each individual

category.

Figure 2: Technology Evolution Tree of 2G & 3G U.S. Patent Filings


3.3 Analysis of Seminal Patents

The entire 2G and 3G portfolio was analyzed and ranked using iRunway‟s portfolio analysis

solution – COMPASSSM. A list of seminal 2G and 3G patents was generated based on a

combination of manual research and a proprietary algorithm for strength calculation. The

seminal patent set constituted the top 5% of ranked patents. The strength of the patents

was determined based on multiple parameters such as infringement detection, number of

independent and dependent claims, technology activity rate, backward and forward

references, age of the patent, etc.

Table 3 illustrates the patent distribution for top seminal patent holders, their share of

seminal patents and their share of all 2G and 3G patents:



Company Name

Count of

Seminal

patents

Share of

Seminal

patents

Count of All

2G & 3G

patents

Share of All

2G & 3G

patents

Nokia 143 16.55% 1363 7.89%

LG 118 13.66% 584 3.38%

Qualcomm 113 13.08% 915 5.30%

Ericsson 51 5.90% 1504 8.71%

InterDigital 48 5.56% 462 2.68%

Alcatel-Lucent 45 5.21% 793 4.59%

Samsung 21 2.43% 653 3.78%

Siemens 17 1.97% 144 0.83%

Nokia Siemens Networks 15 1.74% 173 1.00%

Research in Motion 14 1.62% 598 3.46%

Broadcom 13 1.50% 309 1.79%

Sony Corp 12 1.39% 121 0.70%

Cisco 12 1.39% 488 2.83%

France Telecom 11 1.27% 45 0.26%

Vringo Infrastructure Inc. 10 1.16% 74 0.43%

Nortel Networks* 10 1.16% 346 2.00%

General Dynamics 10 1.16% 34 0.20%

Philips Electronics 7 0.81% 47 0.27%

Table 3: Top Seminal Patent Holders


Nokia, LG and Qualcomm hold very strong patents in the 2G and 3G domain. While the top

six companies listed in the table above collectively hold 60% of all seminal patents, these

three companies alone own a combined share of 43%.

In order to better understand the strength and quality of the portfolios that companies hold,

iRunway analyzed the ratio of the number of seminal patents to their respective portfolio

sizes. Figure 3 shows this metric for the top seminal patent holders:



Figure 3: Percentage of Seminal Patents in the Portfolio of Each Company


Analysis of this metric revealed certain interesting insights. Beyond the top patent holders

(by portfolio size), certain smaller companies hold key patents in the 2G and 3G domain. In

fact, companies having a smaller portfolio but with a higher percentage of seminal patents

could be viewed as having higher patent monetization potential. Also:

LG holds a significantly stronger portfolio compared to other large players in the

industry.

With a relatively high number of seminal patents, companies such as Vringo and General

Dynamics could be viewed as having a small, yet strong, patent portfolio.

Table 4 shows the distribution of seminal patents for top companies across categories:

Company

Distribution of Seminal Patents across Categories

Comm.

Quality

Data


Power


Nokia 16 25 3 13 59 27 143

LG 0 109 0 3 5 1 118

Qualcomm 17 24 1 21 41 9 113

Ericsson 12 12 0 6 18 3 51

InterDigital 5 29 2 3 7 2 48

Alcatel-Lucent 10 13 1 3 13 5 45

Samsung 1 16 0 1 1 2 21

Siemens 3 6 0 0 6 2 17

10%

20%

12%

3%

10%

6%3%

12%9%

2%4%

10%

2%

24%

14%

3%

29%

15%

0%

5%

10%

15%

20%

25%

30%



Nokia Siemens Networks 1 3 0 1 6 4 15


Broadcom 6 2 1 0 4 0 13

Sony 1 4 1 0 4 2 12

Cisco 3 0 0 0 9 0 12

France Telecom 1 0 0 0 8 2 11

Vringo Infrastructure Inc. 2 0 0 2 3 3 10

Nortel Networks* 2 1 0 0 7 0 10

General Dynamics 1 7 0 0 2 0 10

Philips Electronics 2 1 0 3 1 0 7

Total 83 254 9 57 205 62 670

Table 4: Distribution of Seminal Patents across Categories


3.4 Analysis of Standard-Essential Patents

A standard-essential patent in this study is one for which it has been declared (by the

patent holder or the standards organization) that practicing one or more of the inventions

set forth therein is required in order to comply with a technical standard published by a

standards organization in the telecommunications industry. The European

Telecommunications Standards Institute (ETSI) is one such standards organization that

extensively covers telecom patents.

In our research, we analyzed 854 patents (out of the total portfolio count of 17,268) that

have been declared standard-essential by ETSI. These 854 patents are hereinafter referred

to as „standard-essential patents‟. Table 5 illustrates the top standard-essential patent

holders in the 2G and 3G landscape across categories.

Company

Standard-Essential Patent Distribution across Categories

Comm.

Quality

Data


Power


Nokia 39 73 10 32 54 19 227

Qualcomm 19 50 20 24 33 0 146

Ericsson 12 34 5 19 11 4 85

Samsung 3 47 0 6 0 1 57

LG 0 35 0 0 3 0 38

InterDigital 0 19 0 15 1 0 35

Nokia Siemens Networks 5 10 2 3 11 2 33



Nortel Networks* 1 11 2 3 5 0 22

Vringo Infrastructure Inc. 6 1 3 3 3 3 19

Innovative Sonic Limited 0 16 0 1 2 0 19

NTT 0 15 0 3 0 0 18

Motorola Solutions Inc. 1 6 0 9 0 0 16

Huawei 2 3 0 1 7 2 15


Total 88 320 42 121 142 31 744

Table 5: Distribution of Top Standard-Essential Patent Holders across Categories

(Source: iRunway analysis based on patent data from ETSI & USPTO)

80% of all standard-essential patents are owned by the top ten companies on the list.

Nokia leads the list and owns 26% of all standard-essential patents. It has 55% more

standard-essential patents than Qualcomm, which stands second on the list.

Qualcomm and Ericsson together own 27% of all standard-essential patents.

An analysis of the percentage of standard-essential patents in the portfolio of each company

was done to understand the quality of the portfolio. Figure 4 shows this percentage for top

companies that hold standard-essential patents:

Figure 4: Percentage of Standard-Essential Patents in the Portfolio of Each Company


Innovative Sonic with 53% and Vringo with 26% have the highest proportion of

standard-essential patents in their portfolios. Note that Vringo also had a high

percentage of seminal patents in its portfolio.

17% 16%

6% 9% 7% 8%

19%

6%

26%

53%

7% 5% 8%2%

0%

10%

20%

30%

40%

50%

60%



3.5 Patent Filing and Grant Trends

Figure 5 shows the 2G and 3G patent filing trends of the top 5 companies from 1993-2009:

Figure 5: Patent filing trend of the top 5 companies

Figure 6 shows the 2G and 3G patent grant trend of the top 5 companies from 1995-2012:

Figure 6: Patent grant trend of the top 5 companies

Ericsson started investing in 2G and 3G technology early, and filed a large number of

patent applications as early as 1994.

Nokia accelerated and substantially increased its 2G and 3G IP investments between

1997 and 2005. In the last few years, Ericsson and LG have shown an increase in the

number of patent filings, in comparison to the others on the list.

0

50

100

150

200

250

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Nu

mb

er

of

Pat

en

ts

Filing Year

Alcatel-Lucent Ericsson Nokia Qualcomm Samsung

0

50

100

150

200

250

300

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Nu

mb

er

of

Pat

en

ts

Year of Issuance

Alcatel-Lucent Ericsson Nokia Qualcomm Samsung



4 Key Players in the 2G & 3G Patent Landscape

4.1 Ericsson

Ericsson focused its 2G and 3G patent investments in the domain of Security, Power

Management and Data Transfer Rate, and has over 1,500 U.S. patents. It has a strong

presence in the Communication Quality and Services domains.

Ericsson started its research and IP investments on 2G and 3G ahead of all other

companies and owns the largest portfolio in this field. The company also has a good

number of seminal and standard-essential patents.

Ericsson and Samsung entered into a license agreement on mobile technology in 2002,

wherein Ericsson granted Samsung a non-exclusive worldwide license to its patent

portfolio for GSM, TDMA, GPRS, EDGE and WCDMA mobile standards2.

Figure 7: Technology Evolution Tree of Ericsson’s 2G & 3G U.S. Patent Filings


2 www.edn.com/Pdf/ViewPdf?contentItemId=4347452

http://www.edn.com/Pdf/ViewPdf?contentItemId=4347452



4.2 Nokia

Nokia holds the most number of seminal patents (roughly 17%) and owns patents in all

key technologies related to 2G and 3G, especially in Communication Quality, Data

Transfer and Security. It also owns the most number of standard-essential patents

(227), and has strength in the Data Transfer Rate and Security domains.

The company has been actively involved in monetization through patent sales. .

Recently, Nokia sold around 500 of its global patents to Vringo, which includes 109 U.S.

patents covering 2G, 3G and 4G technology3.

In September, 2011, MOSAID Technologies Inc. acquired Core Wireless Licensing, which

had a portfolio of roughly 2,000 global wireless patents and applications, including 2G

and 3G patents originally filed by Nokia4.

Nokia and Qualcomm, market leaders in this domain, entered into a 15-year patent

licensing agreement in 2008, which gave Nokia access to all of Qualcomm‟s patents5.

Figure 8: Technology Evolution Tree of Nokia’s 2G & 3G U.S. Patent Filings


3 http://www.phonearena.com/news/Nokia-sells-500-patents-to-Vringo-for-22-million_id33162 4 http://www.mosaid.com/corporate/news-events/releases-2011/110901.php 5 http://www.qualcomm.com/media/releases/2008/07/23/nokia-and-qualcomm-enter-new-agreement

http://www.phonearena.com/news/Nokia-sells-500-patents-to-Vringo-for-22-million_id33162

http://www.mosaid.com/corporate/news-events/releases-2011/110901.php

http://www.qualcomm.com/media/releases/2008/07/23/nokia-and-qualcomm-enter-new-agreement



4.3 Qualcomm

Qualcomm has a significant number of patents and patent applications worldwide in

CDMA, OFDMA and other technologies. It also owns a nearly 13% share of all seminal

patents in the 2G and 3G space, standing third to Nokia and LG.

Qualcomm has the second highest number of standard-essential patents (146). It is the

leading patent holder of core patents in advanced 3G mobile technologies, as well as in

CDMA and WCDMA standards6.

CDMA2000 1X EV-DO and later revisions use Qualcomm‟s High Data Rate (HDR) system

to support packet data rates of up to 2.4 Mbps. Rapid expansion and adoption of CDMA

and OFDMA worldwide has ensured uniform growth of license and royalty revenues for

the company since the mid-1990s7.

Figure 9: Technology Evolution Tree of Qualcomm’s 2G & 3G U.S. Patent Filings


6 http://www.qualcomm.com/about/businesses/qtl, http://www.aqsacom.com/resources/pdf/LI-3G-4G-

AQSA_WP_2012_01.pdf 7 http://www.qualcomm.com/about/businesses/qtl

http://www.qualcomm.com/about/businesses/qtl

http://www.aqsacom.com/resources/pdf/LI-3G-4G-AQSA_WP_2012_01.pdf

http://www.aqsacom.com/resources/pdf/LI-3G-4G-AQSA_WP_2012_01.pdf

http://www.qualcomm.com/about/businesses/qtl



4.4 Alcatel-Lucent

Alcatel has been a popular name in the telecommunications industry from the early

1990s, long before its merger with Lucent Technologies.

It has focused its patenting efforts in the Communication Quality, Data Transfer Rate

and Security domains, owning strong patents in these domains.

It is one of the top five companies owning the most number of 2G and 3G patents, and

figures among the top six companies holding the most number of seminal patents.

The company plans to continue to raise funds by licensing its patent portfolio, and has

joined hands with RPX Corporation8.

Figure 10: Technology Evolution Tree of Alcatel-Lucent’s 2G & 3G U.S. Patent Filings


8 http://www.theregister.co.uk/2012/02/14/alcalu_sells_patents/

http://www.theregister.co.uk/2012/02/14/alcalu_sells_patents/



4.5 Samsung

Samsung has been a key player in the overall telecommunications market for a long

time, and owns a significant number of patents relating to Communication Quality and

Data Transfer Rate.

9% of the total number of its 2G and 3G patents is declared standard-essential.

Samsung was relatively late in entering the 2G and 3G market and only accelerated its

research in the late 1990s. However, the filing and grant trends reveal that, since then,

the company‟s research in this space is steadily increasing.

Figure 11: Technology Evolution Tree of Samsung’s 2G & 3G U.S. Patent Filings




5 Monetization of 2G & 3G Patents

The last decade has witnessed an increase in patent infringement lawsuits in the

telecommunications industry. Often referred to as “Patent Wars”, these legal battles are

predicted to continue at a more active pace in the near future.

It all started in the mid-2000s when the 2G market was growing at a steady pace and all

companies holding significant IP in this field started looking at monetization options. The

major market players sued each other over various technologies, often with the aim to

remove a competitor‟s product from the market. These cases, interestingly, worked both

ways, and a majority of them resulted in cross-licensing deals between the litigants.

Companies also entered the market through acquisition of strong patents, attracting

attention from several industry players who were prepared to shell out millions to own such

IP. Here are some examples:

One important case involving multinational companies was the lawsuit between Ericsson

and Samsung. In early 20139, Samsung answered Ericsson‟s claims of patent

infringement by countersuing the Swedish multinational, alleging infringement of 20 of

Samsung‟s patents, including those related to 2G and 3G wireless standards and device

functions. In the same year, Ericsson entered into a licensing deal relating to 2G, 3G and

LTE technologies with Unwired Planet.

In 2007, Qualcomm filed patent infringement lawsuits against Nokia in GSM technology.

Following this, Nokia paid licensing fees to access all of Qualcomm‟s patents10.

Brandywine Labs has sued over 39 service providers to date, including AT&T, Verizon

and Century Link, over DSL patents11.

In 2012, a group of eight telecom service providers, including Alcatel-Lucent and

EarthLink, entered into separate patent agreements with visual voicemail provider

Klausner Technologies for its consumer and enterprise visual voicemail technologies12.

Fractus, a company that designs and manufactures antennas for mobile handsets and

wireless devices, filed lawsuits in 2009 against ten mobile phone companies, claiming

9 http://online.wsj.com/article/SB10001424127887324103504578371902710149908.html 10 http://www.pcworld.com/article/148850/article.html 11 http://www.fiercetelecom.com/story/att-verizon-and-centurylink-embroiled-adsl-patent-fight-brandywine/2013-

01-03 12 http://www.fiercetelecom.com/story/earthlink-alcatel-lucent-among-providers-settle-voicemail-patent-suits-

klau/2012-05-18

http://online.wsj.com/article/SB10001424127887324103504578371902710149908.html

http://www.pcworld.com/article/148850/article.html

http://www.fiercetelecom.com/story/att-verizon-and-centurylink-embroiled-adsl-patent-fight-brandywine/2013-01-03

http://www.fiercetelecom.com/story/att-verizon-and-centurylink-embroiled-adsl-patent-fight-brandywine/2013-01-03

http://www.fiercetelecom.com/story/earthlink-alcatel-lucent-among-providers-settle-voicemail-patent-suits-klau/2012-05-18

http://www.fiercetelecom.com/story/earthlink-alcatel-lucent-among-providers-settle-voicemail-patent-suits-klau/2012-05-18



infringement of its patents covering internal multiband antennas common to all cell

phones, tablets, laptops, navigation devices and other wireless portable devices13.

In 2013, InterDigital filed lawsuits against Samsung, Nokia, Huawei and ZTE claiming

infringement of patents applicable to wireless devices with 3G and 4G capabilities14.

In 2013, Ericsson has sued Micromax, an Indian tablet and Smartphone maker, alleging

infringement of patents that cover wireless technologies15.

5.1 Potential Licensing & Litigation of 2G & 3G Patents

It is interesting to note that almost 9% of seminal 2G and 3G patents are held by few

companies. About 5% of all standard-essential patents are owned by Innovative Sonic Ltd.

and Vringo Infrastructure Inc. Table 6 shows the total count of issued U.S. patents of some

of the active companies in this sector, including their ownership of seminal and standard-

essential patents, and the percentage of seminal and standard-essential patents in their

respective portfolios:

Company Total

Count

Count of

Seminal

Patents

% of

Seminal

Patents in

Portfolio

Count of

Standard

Essential

Patents

% of

Standard

Essential

Patents in

Portfolio

Vringo Infrastructure Inc. 74 10 13.5% 19 25.7%

Core Wireless Licensing 12 6 50.0% 1 8.3%

Pendrell Corporation 39 5 12.8% 0 0%

Gemalto 15 4 26.7% 0 0%

Intellectual Ventures 13 3 23.1% 0 0%

Table 6: U.S. Patent distribution of Few Companies


Vringo Infrastructure Inc.

Vringo works on development and monetization of mobile technologies and intellectual

property. The company‟s portfolio includes a combination of patents for technology

developed internally and the 500 global patents and applications that it acquired from

13 http://www.reuters.com/article/2012/07/31/idUS154268+31-Jul-2012+BW20120731 14

http://files.shareholder.com/downloads/IDCC/2251043075x0x625722/37ac125c-337c-4cd6-8390-

b2afea490fa5/IDCC_News_2013_1_2_General_Releases.pdf 15 http://in.reuters.com/article/2013/03/26/ericsson-micromax-telecom-idINDEE92P0C320130326

http://www.reuters.com/article/2012/07/31/idUS154268+31-Jul-2012+BW20120731

http://files.shareholder.com/downloads/IDCC/2251043075x0x625722/37ac125c-337c-4cd6-8390-b2afea490fa5/IDCC_News_2013_1_2_General_Releases.pdf

http://files.shareholder.com/downloads/IDCC/2251043075x0x625722/37ac125c-337c-4cd6-8390-b2afea490fa5/IDCC_News_2013_1_2_General_Releases.pdf

http://in.reuters.com/article/2013/03/26/ericsson-micromax-telecom-idINDEE92P0C320130326



Nokia16 in 2012. The company has also filed some recent patent infringement lawsuits

against ZTE Corp in the U.K., France, Australia and Germany17.

74 of Vringo‟s U.S. patents are relevant to 2G and 3G technology. These patents are

spread across all the Level 1 categories, with the most number of patents belonging to

Communications Quality (28) and Services (17).

19 of these 74 patents are standard-essential.

10 of its patents are featured in the top seminal patents ranking.

Core Wireless Licensing S.A.R.L.

Core Wireless Licensing is a wholly-owned subsidiary of MOSAID, a leading IP management

company. The company deals with development and monetization of intellectual property in

the telecommunications space. Core Wireless Licensing, like Vringo, has also acquired

patents that were initially filed by Nokia.

12 of Core Wireless‟ patents are relevant to 2G and 3G, with a majority of its patents

belonging to the Positioning and Power Management categories.

6 of the 12 patents have been ranked as seminal.

Core Wireless has filed a lawsuit against Apple over one of its patents related to 3GPP

standard-essential technology, which it had earlier acquired from Nokia18.

Pendrell Corporation

Pendrell is an intellectual property investment, advisory services and asset management

firm that is in the business of acquiring, commercializing, managing and licensing IP in the

fields of tablets, Smartphone and other consumer electronics.

Pendrell acquired approximately 125 patents and patent applications worldwide from

Nokia through its wholly-owned subsidiary, Helsinki Memory Technologies (HMT)19. The

current patent portfolio that Pendrell holds includes inventions conceived by their

employees or by global leaders such as IBM, Xerox and Phillips20.

39 of Pendrell‟s patents are relevant to 2G and 3G technology, with five of these ranked

as being seminal.

16

http://www.businesswire.com/news/home/20120809005600/en/Vringo-Nokia-Execute-Patent-Purchase-

Agreement#.VHMorfmUer8 17 http://www.lightreading.com/document.asp?doc_id=698844 18 http://www.pcworld.com/article/251396/mosaid_subsidiary_sues_apple_over_wireless_patents.html 19 http://www.worldipreview.com/news/nokia-sells-a-chunk-of-patents-to-pendrell 20 http://biz.yahoo.com/e/130308/pco10-k.html

http://www.businesswire.com/news/home/20120809005600/en/Vringo-Nokia-Execute-Patent-Purchase-Agreement#.VHMorfmUer8

http://www.businesswire.com/news/home/20120809005600/en/Vringo-Nokia-Execute-Patent-Purchase-Agreement#.VHMorfmUer8

http://www.lightreading.com/document.asp?doc_id=698844

http://www.pcworld.com/article/251396/mosaid_subsidiary_sues_apple_over_wireless_patents.html

http://www.worldipreview.com/news/nokia-sells-a-chunk-of-patents-to-pendrell

http://biz.yahoo.com/e/130308/pco10-k.html



All of those 39 patents belong to the Level 1 category relevant to Security.

Gemalto

Formed in 2006 with the merger of Gemplus International and Axalto, Gemalto has been

one of the leaders in the digital security domain21. It provides software applications for

personal security and is a major manufacturer of smart cards.

15 of Gemalto‟s patents are relevant to 2G and 3G technology and belong to the

Security and Communication Quality categories. Four of these 15 are ranked seminal.

In its 2011 annual report, the company announced “temporary postponement of the

signing of new licenses.”22 However, considering the strength of its portfolio and strong

litigations it had filed in the past, the company could resume its monetization efforts.

Intellectual Ventures Management LLC

Intellectual Ventures Management LLC‟s portfolio, which is known as the IV portfolio, has

over 70,000 acquired patents and patent applications and 3,000 patent applications for in-

house inventions23. The company often acquires patents from smaller firms or individual

inventors and aggregates them into a large portfolio, which now comprises patents relating

to almost all technical domains. Recently, the company joined hands with NVIDIA to acquire

the patent portfolio of IPWireless, a leader in wireless technologies24.

Its patents in the 2G and 3G domains primarily belong to Communication Quality, Data

Transfer Rate and Security categories.

The company earlier involved itself in lawsuits with corporations such as AT&T and

Motorola over some of its telecommunications patents25.

The above companies have successful patent monetization programs in place and the

industry may see more efforts from these patent holders to monetize their patents through

effective licensing and litigation campaigns against key players in the market.

21 http://www.gemalto.com/companyinfo/about/merger/ 22 http://www.businesswire.com/news/home/20120307006629/en/Gemalto-full-year-2011-results#.VHMqPPmUer8 23 http://www.intellectualventures.com/index.php/inventions-patents/patent-portfolio 24 http://nvidianews.nvidia.com/Releases/NVIDIA-and-Intellectual-Ventures-Partner-to-Acquire-Portfolio-of-

Wireless-Patent-Assets-7dc.aspx 25 http://www.intellectualventures.com/assets_docs/Complaint.pdf, http://www.intellectualventures.com/assets_docs/Motorola_Complaint.pdf

http://www.gemalto.com/companyinfo/about/merger/

http://www.businesswire.com/news/home/20120307006629/en/Gemalto-full-year-2011-results#.VHMqPPmUer8

http://www.businesswire.com/news/home/20120307006629/en/Gemalto-full-year-2011-results#.VHMqPPmUer8

http://www.intellectualventures.com/index.php/inventions-patents/patent-portfolio

http://nvidianews.nvidia.com/Releases/NVIDIA-and-Intellectual-Ventures-Partner-to-Acquire-Portfolio-of-Wireless-Patent-Assets-7dc.aspx

http://nvidianews.nvidia.com/Releases/NVIDIA-and-Intellectual-Ventures-Partner-to-Acquire-Portfolio-of-Wireless-Patent-Assets-7dc.aspx

http://www.intellectualventures.com/assets_docs/Complaint.pdf

http://www.intellectualventures.com/assets_docs/Motorola_Complaint.pdf



6 Glossary of Terms

1. Communication Quality

Backhaul Network: Backhaul Network comprises intermediate links between the

core network and the small sub-networks at the edge of a telecommunication network.

It guarantees Quality of service (QoS) to the end customer.

Congestion Control: Congestion control prevents network collapse due to

oversubscription of processing or link capabilities of network resources by regulating

traffic entry into a telecommunications network and also by taking resource utilization

reducing steps.

Handover: Handover is simply a process of transferring a call or a data session from

one channel to another to provide uninterrupted service.

2. Data Transfer Rate

Error Control: Error Control are techniques which ensure reliable delivery of data

over an unreliable telecommunication network by taking measures to remove errors

which may creep in due to channel noise.

Link Adaptation: Link Adaptation, also known as Adaptive Modulation and Coding

(AMC), is the process of matching modulation, coding and other signal and coding

parameters to the conditions on the radio link.

Shared Traffic Channels: Shared Traffic Channels enable sharing of network

resources among a group of users, enabling lower network costs and faster service.

Spreading Codes26: Spreading is basically an operation for increasing signal

bandwidth by using channelization (orthogonal) codes and scrambling (pseudo-noise)

codes.

Transmit Diversity: Transmit Diversity is a technology of using multiple transmit

antennae to transmit identical information bearing signals varying in their transmission

characteristics at any given instant.

3. Positioning

Network Based: Network Based techniques make use of the network provider‟s

infrastructure to identify the location of the handset in a non-intrusive manner.

26 http://www.comlab.hut.fi/opetus/238/lecture6_ch6.pdf

http://www.comlab.hut.fi/opetus/238/lecture6_ch6.pdf



UE Assisted: UE Assisted methods include methods such as OTDOA that require a

mobile phone to determine the time difference between specific signals from several

base stations and report it to a network device (SMLC), which then calculates the mobile

phone‟s location.

UE Based: UE Based techniques include A-GPS or Assisted GPS in which network

signals are used to reduce the time to first fix a GPS satellite to provide faster location

determination of the mobile phone.

4. Power Management

Continuous Packet Connectivity: Continuous Packet Connectivity includes

Discontinuous Transmission (DTX), Discontinuous Reception (DRX) and HSCCH-less

operation, which provide an always-on experience to the end-user while increasing

battery life by almost 15%.

Power Control: Power Control is a mechanism for setting appropriate transmission

power level of the mobile phone to ensure reliable quality of service.

5. Security

Access Control: Network Access Control unifies a wide range of technologies to

ensure end-point security. This includes host intrusion prevention, vulnerability

assessment, user or system authentication and network security enforcement.

Encryption: Encryption here refers to technologies pertaining to network security

and cryptography that maintain confidentiality of data transmitted over a wireless

network by ensuring strong data encryption and transmission over a secure channel.

6. Services

Location-Based Services: Location-Based Services cover a wide range of services,

including social networking, navigation, exploration etc. that are provided using location

information of the mobile handset.

Value Added Services: Value Added Services include all telecommunications

services that are not core services, i.e. call or fax transmission. These include MMS,

SMS, IMS and Intelligent Networks based technologies.

Texas

1114 Lost Creek Blvd

Suite 400

Austin, TX 78746

Tel: +1 512 284 8200

California

2905 Stender Way

Unit 28

Santa Clara, CA 95054

Tel: +1 650 308 4807

Colorado

8400 E. Crescent Parkway

Suite 600

Greenwood Village, CO 80111

Tel: +1 720 528 4273

India

1st Floor, AMR Tech Park I Annex

No. 23 and 24, Hongasandra

Hosur Road, Bangalore - 560068

Tel: +91 804 058 4000

www.i-Runway.com

iRunway® is a registered trademark of iRunway India Private Limited.

iRunway has prepared this research independently based on reliable public data and reviewed the results based on its proprietary methodology, with the belief that it is fair and not misleading. The preparers of the information in this report are not engaged in rendering legal or other professional advice, and nothing in this document should be construed as such. iRunway does not practice law and it exists to provide technical research, analysis and reporting capability to its clients.

The patent data in this report is as of the date of preparation and therefore is subject to change as new patents are filed and issued every day. iRunway, nor any employee of iRunway accepts any liability for any damages or losses, direct, indirect, consequential, arising from any use or interpretation of this report or its contents.

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2g & 3g mobile communication

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