2013-05-10

The SSL Intellectual Property Landscape

In a technological industry on the steep part of its growth curve, with markets worth billions up for grabs, intellectual property rights will increasingly determine winners and losers.

There is plenty of action on the patent front in the SSL industry today, but it seems to be mostly in the nature of skirmishes now. Major battles took place some years back, and they seem to have been settled without a great deal of noise or acrimony. The result is that, among large players at least, cross-licensing agreements help the industry avoid the kind of impenetrable patent thicket that has emerged around mobile technology.

Here are a few of the aspects of intellectual property that we will be looking at in more detail in future blogs.

Trends
This survey article in LEDs Magazine, authored by Kathryn Paisner of IP Checkups, lays out some of the patenting trends in the SSL arena over the last three decades.

Patent filings have been on the rise in the many sub-markets that make up the SSL landscape. Before 2000, the number of patents filed, plus issued worldwide, amounted to a few hundred per year, with much of the activity centered in Japan. In 2000, the filings exploded, and they have been growing ever since -- in 2010, around 3,600 were filed. By 2003, the US had taken the lead in new SSL patents. Since about 2004, Philips (sponsor of this site) has dominated the list of patenting companies in a number of areas, including optics, lenses, and reflectors.

Patent peace
The major players in SSL lighting have been suing and settling, and settling without suing, since early in the century. Here is a cross-licensing diagram from 2007 showing how things had settled out by that time. Philips's licensing program has signed up Cree, Osram, Acuity, Cooper, and over 200 others. Cree has signed Philips, Nichia, Bridgelux, Osram, and Seoul Semiconductor. Here are a few of the cross-licensing agreements that have been inked so far: Osram & Nichia (2002), Osram & Philips in 2007, Osram & Everlight (2009), Philips & Cree (2010), Cree & Osram (2011), Seoul Semiconductor & Philips (2011), Samsung & Osram (2012), and Osram & LG (2012).

Trolls
The SSL space is beginning to see participation from "non-practicing entities," NPEs, also known by their opponents as "patent trolls." What all NPEs have in common is that they hold, and possibly assert, patents without having developed any products around them. NPEs come in several flavors. Some are the intellectual-property arms of universities or other organizations focused mainly on research and education; examples include Wisconsin Alumni Research Foundation (WARF), and the Commonwealth Scientific and Industrial Research Organization (CSIRO). Others combine research activities with IP enforcement; Intellectual Ventures falls into this camp. Still others, what most people mean when they say "trolls," do nothing but enforcement.

The aforementioned IP Checkups maintains a clean technology patent database, from which the above data on patents held by NPEs in the LED space were taken last fall. The CEO of IP Checkups, Matt Rappaport, told me they are seeing more interest in acquiring LED patents across the board -- including by the troll community. It is likely that more rent-seeking by these players will act as a tax on the LED industry as we go forward.

— Keith Dawson , Editor-in-Chief, All LED Lighting