WiMAX Patent Pool Is Planned
Firms Aim to Spur Use by Limiting Royalty Payments
By DON CLARK
June 9, 2008; Page B6
Six big technology companies are spearheading a plan to jointly license patents that cover the wireless technology called WiMAX hoping to limit royalty rates that could deter customers from using it.
The participants are Cisco Systems Inc., Intel Corp., Samsung Electronics Co., Sprint Nextel Corp., Alcatel-Lucent and Clearwire Corp., according to people familiar with the situation and a document outlining the group's plans.
They have scheduled a conference call Monday to announce an organization, the Open Patent Alliance, to gather rights to WiMAX-related patents and license them to makers of computers, networking devices and other products, these people said.
WiMAX is a long-range cousin of a wireless technology called Wi-Fi that comes with many laptop computers. Intel, which heavily promoted Wi-Fi, has been pushing to make WiMAX another built-in feature of portable PCs. Sprint and Clearwire plan to build a nationwide WiMAX network, while Samsung, Cisco and Alcatel-Lucent are expected to make WiMAX equipment.
But hardware makers could be spooked if patent royalties are too high or the potential costs are uncertain. WiMAX backers cite the case of third-generation cellular networks; companies such as Qualcomm Inc., Nokia Corp. and Telefon AB L.M. Ericsson separately charge patent royalties for 3G products.
Some industry analysts say cellphone makers face cumulative royalties of more than 25% of the price of handsets, unless they have their own patents to help in negotiating lower rates. One person familiar with the thinking of the WiMAX alliance said it hopes to license WiMAX patents at "much lower" rates than those in the cellular industry.
Such patent pools aren't a new idea.
Continued
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