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RFID industry group proposes patent licensing consortium

Posted: 11 Aug 2005 ?? ?Print Version ?Bookmark and Share

Keywords:rfid? intellectual patent? dvd?

A group of companies involved with radio frequency identification (RFID) technology have announced their intention to form an intellectual property (IP) licensing consortium to offer both an efficient patent management approach for patent holders and convenient access to RFID patents for manufacturers and end-users. The group is also calling for other companies or individuals holding essential RFID patents to join in the proposed consortium.

The consortium will be modeled after the successful patent licensing consortium formed and implemented around essential technologies in the MPEG-2 and DVD industries. The RFID consortium is intended to provide a structured approach for holders of essential RFID patents to receive fair compensation for those patents, at a reasonable cost to the end-user, thus promoting rapid adoption of RFID. The approach offers competitive benefits by integrating complementary technologies and reducing transaction costs. It also offers an effective alternative to time-consuming and expensive individual licensing agreements.

RFID technology uses small radio chips that, among other uses, can be placed in tags or labels to help manufacturers and retailers locate stock and to automatically record the movement of inventory. The technology is widely regarded as the next-generation advanced data capture technology, beyond the ubiquitous bar code. Government agencies and retailers have urged their suppliers to speed their implementation of RFID technology.

The consortium will license patents that are essential to the commercially viable operation and manufacture of RFID chips, tags or labels, and readers. Such consolidated licensing enables the use of broad-based technologies covered by many patents owned by diverse patent holders. MPEG-2 video decoding and DVD format are examples of two technologies that now enjoy widespread availability and industry interoperability as a result of patent portfolio licensing arrangements. Such a licensing approach benefits end-users, and also relieves patent holders from the burden of managing hundreds of different licensing agreements with individual licensees.

Under the proposed licensing arrangement, all essential RFID patents owned by members of the consortium will be made available to interested companies via a single license on fair, reasonable and non-discriminatory terms.

"The group of companies that have come together to support the consortium believe that an essential patent portfolio license is the most effective approach for assuring access to the IP necessary for RFID to be widely implemented in the marketplace," said Kevin Ashton, designated spokesperson for the consortium and vice president, ThingMagic.

"We are encouraging all essential RFID patent holders to join with us to form the consortium and add their patents to the license in order to advance the broad adoption of this technology," said Stan Drobac, designated spokesperson for the consortium and vice president, RFID strategy and planning, Avery Dennison.

Carl McGrath, CTO at Tyco Fire & Security, worked with the MPEG consortium as an executive at AT&T. According to him, the RFID consortium could significantly help the commercialization of RFID technology.

The consortium will be based on, and supportive of, the standards and specifications announced by EPCglobal, a not-for-profit organization involved in proposing standards for electronic product codes and RFID technology, as well as ISO counterpart proposed standards. The consortium will be open to all patent holders, regardless of whether they were involved in the development of those standards. The EPCglobal and ISO specifications are expected to be followed by RFID technology users to ensure interoperability.

Moreover, the consortium expects to work in parallel with those standard setting organizations to assist in the commercialization and wide acceptance of the standards they independently develop.

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