Eindhoven University of Technology MASTER Developing a Patent
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Eindhoven University of Technology MASTER Developing a patent strategy for Philips' Digital Rights Management patent portfolio van de Laarschot, H.U.O.N. Award date: 2003 Link to publication Disclaimer This document contains a student thesis (bachelor's or master's), as authored by a student at Eindhoven University of Technology. Student theses are made available in the TU/e repository upon obtaining the required degree. The grade received is not published on the document as presented in the repository. The required complexity or quality of research of student theses may vary by program, and the required minimum study period may vary in duration. General rights Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain Tu I e t1ilchnlsche universiteH eindhoven Developing a Patent Strategy for Philips' Digital Rights Management Patent Portfolio H. van de Laarschot ----- -- --- -- --- -CONFIDENTIAL UNTIL DECEMBER 2005 --------------- Developing a Patent Strategy for Philips' Digital Rights Management Patent Portfolio by Huon van de Laarschot (student ID 449498) September 2002 - November 2003 Written under the direction of: M.S.C. Bakker LL.M. Ph.D. Eindhoven University of Technology Department of Technology Management And A.A.CM. Kalker Ph.D. Eindhoven University of Technology Department of Electrical Engineering And A.P. Engelfriet M.Sc. Philips Intellectual Property and Standards "Developing a Patent Strategy for Philips' Digital Rights Management Patent Portfolio"; a thesis submitted to the "Technische Universiteit Eindhoven" (Eindhoven University of Technology), The Netherlands; m partial fulfihnent of the requirements for the degree of Master of Science in the "Technology and Society" program (specialisation: Technology and Innovation Policy for Advanced Economies, Computer Science) at the department of Technology Management. i Copyright© 2003 Huon van de Laarschot All rights reserved. No part of this publication may be reproduced, stored ma retrieval system, or transmitted 1n any form or by any means, electronic, rnechanicat photocopying, recording or otherwise, without prior written permission of the author. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source. All terms mentioned in this book that are known to be trademarks or service marks are the properties of their respective owners. ISBN 90-9017652-7 ii A patent strategy aids a company in strengthening its position amongst other patent holders. General strategies focus on lJCensing to create revenues, focus on JSolahon to offer a unique product (feature) or defend against the strategy of other companies. Which strategy to follow depends on the willingness to license and the importance of a company's portfolio. Other factors that influence strategy choice are market specific (e.g. number and type of competitors) and technology specific (e.g. multi-invention technologies). Factors such as the emergence of standards and the size of a company also influence this chmce. As a patent strategy is used within a company amongst other strategies (e.g. market strategy), this strategy must be combined with those other strategies. In a case study of patent portfolios for DRM technologies, Philips patent strategy is determined. In order to do so, DRM patents are defined and then searched for usmg the Micropatent, Pluspat and Espacenet patent databases. A DRM patent is defined as " a patent on a technology or the use of a technology for managing interaction with digital content according to interaction rights". Several enabling technologies, such as v-1atermark1ng, fLn.gerprmting and encryption, can be used in ORM a:nd a pc.i.tent on the use of such technologies can constitute a DRM patent. A search is conducted for patents that contain keywords that are typically used in DRM patents. Several steps are taken to improve the completeness of the result set and the results are then filtered to remove non-DRM patents. This filter method uses the European and International patent classifical!ons, to leave only those patents that have been assigned classes that are likely to hold DRM patents. The DRM patents that are found give an md1cal!on of which companies hold relal!vely large DRM patent portfolios. These companies, their portfolios and their relal!on to several DRM alliances are compared. The most important portfolios are held by InterTrust and ContentGuard. Both Philips and Sony, which have a history of formmg alliances to push certam technologies (e.g CD and DVD), hold an above average importance DRM patent portfolio. Most other companies that are included m the companson (e.g. Hitachi, IBM, Matsushita and Thomson), hold diverse portfolios that do not focus on specific technologies. The comparison shows that access to InterTrust' s patents and to a lesser extent some of ContentGuard's patents 1s essenl!al and that DRM patent holders, specifically those in the consumer electronics mdustry, need to cooperate in order to be able to use DRM technologies. Philips patent strategy should be a combination of a licensing and a defensive strategy, in order for Philips to exploit the value of the patents it holds and in order to defend itself from being excluded from using DRM technologies. Furthermore, standardization efforts are important for DRM to be successful and it is critical that Philips promotes the emergence of a (dominant) DRM standard that it finds beneficial. Based on Philips' position amongst other patent holders this could very well result in an (industry) effort to standardize DRM lead by Philips and one or more other consumer electronics companies (specifically Sony). iii THIS PAGE INTENTIONALLY LEFT BLANK iv In the year 2000 the European Patent Office esl!mated there were over four million patents and licensing revenues had grown ten-fold since 1990 to over 100 billion dollars worldwide'. These figures show how important patents have become, not only for the appropriat10n of an invenlion, but also for generating revenues. The role a patent fulfills is changing from a tool aidmg an inventor in protecting his or her work, to a business tool. The use of patents is becoming part of a business strategy and as such planning the creation and exploitation of patents is becoming ever more important. Writing this paper about patent strategies has been an eye-opener for me, as it has shown me how diverse, intellectually stimulating, yet practical, research in the field of patents can be. To most, it would seem to be the exact opposite as such research requires enormous heaps of data to be reviewed, the understanding of technical documents and to some extent a resistance to "legalese". To me this posed as much a challenge as an opportunity to explore different fields of research and combine knowledge from these fields. Many people have supported me in performing this research and writmg this paper I parl!cularly wish to thank MartiJn Bakker, for the discussions we've had about the value of patents to a company, these have been very helpful; Arnaud Engelfnet, for sharmg with me so much knowledge about Philips' IP operations; and Ton Kalker for sharing his technical expertise. Research for this paper took place both at Philips Intellectual Property and Standards (IP&S) and at the Eindhoven University of Technology. I'm grateful to Philips IP&S and in particular its CEO, Mr. Peters for giving me the opportunity to perform part of this research within the company. Furthermore, I wish to express my eternal gratitude towards my parents; they have always supported me and without them, I would not have been able to pursue as many of my dreams as I have been able to pursue. In addition, I wish to thank my girlfriend, fnends and family, all of whom have been there for me whenever I needed them. This paper is the result of true enthusiasm for the research topic I hope that you will enjoy reading it and I welcome all comments, questions and such Huon van de Laarschot - Eindhoven, November 19th 2003 1 Source: www.european-patent-office.org/epo/facts_figures/facts2000/e/5 _e .htm v THIS PAGE INTENTIONALLY LEFT BLANK vi Index Summary ............................................................................................................................... iii Preface ...................................................................................................................................... v 1 Introduction .................................................................................................................... 1 1.1 Research Goal... ....................................................................................................... 2 1.2 Research Questions ................................................................................................ 2 1.3 Additional Comments ........................................................................................... 3 2 Patent Strategies ............................................................................................................ 5 2.1 Research