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BRUSSELS -- Some established technological firms in the West have responded with protectionism in the face of the threat from innovators and newer entrants, a senior expert on digital economy and international trade told Xinhua.
"This is a very worrying development," said Hosuk Lee-Makiyama, director of European Centre for International Political Economy (Ecipe), days after the European Commission ruled that Motorola Mobility was abusing its market position when it filed a patent injunction against Apple.
Motorola Mobility, owned by Google, was seeking and enforcing an injunction, which generally involve a prohibition to sell the product infringing the patent, against Apple in Germany, on the basis of its mobile phone standard-essential patents (SEPs).
Some smartphone manufacturers of the U.S. and the Republic of Korea (ROK) are abusing patents to stop the competition from newer entrants into the tech industry, especially from China, in a similar way like anti-dumping, said the head of the European Union's (EU) leading think tank on international economy.
He saw this "mainly a problem created in in the U.S. patent system that is spilling over to Europe and China."
As some of Motorola's patents are inextricable part of 3G standards, anyone who wishes to manufacture a device able to connect to wireless networks must require a license for these SEPs.
Unless such patents are available on fair, reasonable and non-discriminatory terms (so-called FRAND terms), patents holders can bar anyone from entering the market by imposing discriminatory and unreasonable licensing fees.
According to the European Commission, while recourse to injunctions is a possible remedy for patent infringements, such conduct may be abusive where SEPs are concerned and the potential licensee is willing to enter into a licence on FRAND terms.
"The protection of intellectual property is a cornerstone of innovation and growth. But so is competition," European Commission Vice President in charge of competition policy Joaquin Almunia said in the statement.
"I think that companies should spend their time innovating and competing on the merits of the products they offer, not misusing their intellectual property rights to hold up competitors to the detriment of innovation and consumer choice," he added.
Lee-Makiyama warned that China might become a major victim of abuses of such patents.
"While the West often accused China for intellectual property violations, the next big dispute will cast China as victims rather than perpetrators," he said.
"Indeed, there are many reasons for China to be vigilant against possible abuse by the giants who once designed today's standards, especially if the abuse is aimed at challengers who must stand on their shoulders, including new entrants to the mobile industry, like Apple and Microsoft, or China's emerging technology sector," he said.
The expert on digital economy expected the MPEG-2 video-encoding standard, used to digitally store or display video on any electronic device, to be another area at risk of anti-trust action.
Lee-Makiyama hailed "necessary and legitimate precaution" recently taken by China's Ministry of Commerce to ensure free competition.
"China sometimes even went beyond the conditions posed by the EU and the US, for example, Google had to pledge that the Android operating system would remain free of charge to any manufacturer or app developer as a precondition for the acquisition of Motorola," he said.
"When Western cartels and smartphone manufacturers cannot look to their own best interest and uphold free market principles, an activist enforcement of competition law has become the last resort to keep protectionism and smartphone wars at bay," Lee-Makiyama said. |