The President of Celistics Holdings, which supplies logistical services to the mobile phone industry, Moris Beracha works regularly with mobile phone manufacturers and service providers around the world. He provides some insights into the issue of how patent litigation is beginning to play a greater role in the mobile phone industry. — As mobile phone manufacturers battle for dominance in the lucrative global market, they are turning to their patents to preserve or build market share.
Part of the reason for this trend stems from the fact that mobile phones increasingly take on the functionality of computers, adding complexity through new technology. Many of the innovations used to fuel these advances in smartphone technology are proprietary, having been patented by individual companies in the field. Thousands of patents apply to the functionality of a single mobile phone, and if one company sees another challenging its market share, patent litigation over a feature that could be described by the company’s intellectual property forms an effective counterstrategy.
The industry has seen a trend toward litigation of this type, with major players increasing their litigation activities over the course of 2010 and 2011. In addition, major industry participants are proactively buying up smaller companies in order to acquire patents defensively. This approach has allowed powerful yet relatively new entrants to the industry, such as software companies, to participate in these litigation activities. As mobile phone adoption rates continue to soar worldwide, we can expect to see continued litigation activity of this type.