With vehicle-to-everything connectivity cars will be able to communicate directly with other vehicles, pedestrians, and infrastructure to exchange real-time information about road and traffic conditions. Cars will be able to share direction and location for more predictable and coordinated driving; saving time and fuel and reducing crashes and injuries..
Qualcomm and quite a few other companies have interest in 5G connectivity in cars, saying: ‘Connected cars will benefit from and be transformed by cellular connectivity in ways that will enable new revenue-creating business models while saving lives, and reducing congestion and vehicle emissions. 5G will also enable new in-vehicle experiences for passengers and drivers that are richer and more engaging.’
As standards in cellular connectivity are established for telematics and IOT in automotive it should become easier to work out how much to pay for access to technology, through payment of ‘fair’ licensing fees.
The complexity comes in assuming risk, providing indemnities and accepting responsibility for paying intellectual property licenses through the several layers or tiers of supply chains. The supply chain of the automotive (and aerospace) sector has many suppliers each fitting into a tier system according to the processes each is involved in. In general, a tier 3 company supplies a tier 2 company and a tier 2 company supplies a tier 1 company. With all working together it is possible to build the final product for the manufacturer and end customer.
At what tier in the supply chain should the responsibility fall for paying intellectual property licenses for access to 4G or 5G ‘telephony’ with telematics or even the internet of things?
Photo courtesy of Denys Nevozhai on Unsplash
Apparently this is an area of some debate with the car manufacturers saying the responsibility lies with tier 1 suppliers; and tier 1 suppliers in turn saying no it is the car manufacturer or even the tier 2 supplier. You get the picture and it can get quite ‘complex’ of course.
Historically resolving such payment disputes has led to some contention, however it appears that with 5G there is hope for a more coordinated standards-setting process with multiple parties in multiple geographies. In theory this should mean more universal availability of technology in cars because of the appropriate compensation of technology creators.
Avanci is a business that has been credited with simplifying automotive telephony technology licensing, and especially with 2,3, and 4G. Of course they now have big plans for 5G, hoping to simplify the process by leading at the beginning of the technology life cycle, which should ideally mean car companies can agree early terms with their supply chains before it really takes off.
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Author: John Pryor Exalt IP