The programme has accomplished a rare feat: it has secured deals with all major implementers covering all the relevant SEPs 

By Patrizia La Rosa 

The Sisvel DVB-T2 patent pool has reached a significant milestone: having completed our latest renewal cycle, we now have all major implementers of the DVB-T2 standard under licence. Since the pool contains all the declared SEPs in the space, we have essentially achieved full coverage of both licensors and licensees in this market.  

As a result, the companies that make TVs and set-top boxes implementing DVB-T2 – the broadcast technology of choice across large parts of the globe – are competing on a truly level playing field. The patent owners that developed this technology, meanwhile, are earning compensation from virtually every device sold – generating funds that can be invested back into more R&D.  

This is a significant accomplishment, achieved with committed support from the 10 patent owners in the pool: the BBC, DTVG Licensing, ETRI, Fraunhofer, IMT Atlantique (formerly Telecom Bretagne), LG Electronics, Radio Televisione Italiana (RAI), Samsung Electronics, Sony* and TDF. 

The DVB-T2 programme is a case study in how Sisvel patent pools deliver transactional efficiency. It was not easy – it required years of effort to understand the landscape, coordinate among stakeholders and execute deals. Here is how we did it. 

Listening to the market 

This success story was a long time in the making (a more comprehensive backstory is available here). The pool got off to a slow start after launching with six licensors in 2010. Industry was not adopting the new terrestrial digital broadcast technology as rapidly as forecast. Two of the original patent owners, Nokia and LG Electronics, decided to leave the pool.  

It was clear that the market was not responding to the pool arrangement as it was then constituted. The Sisvel team understood that change was needed if the pool was to serve as an efficient solution.  

Drawing on their knowledge of the market and experience engaging with the key players, they created a new strategic vision for the licensing programme – one focused on meeting the needs of companies that implemented the technology on a large scale while also owning relevant patents. 

A number of changes to the licensing terms were proposed by Sisvel. The royalty rate would be reduced for certain products (those that could only encode or decode, not both). A new category would be added for professional products, with royalty rates varying based on whether they were capable of encoding, decoding or both. Sizeable incentives would be given to compliant licensees – discounts of up to 20%. Finally, new ‘super-early-bird’ conditions would encourage deals to get done quickly. 

Though this meant reduced royalties for many licensees, the existing patent owners agreed to the amendments.  

Creating a balanced offering 

When these changes were explained to the market, the response was swift and positive. In the span of five months, Sisvel made deals with LG Electronics (a former pool participant), Samsung (which had purchased the Nokia patents previously included in the pool) and Sony – all heavyweights in the TV market who also owned patents relevant to DVB-T2.  

These players with strong interests on both sides of the equation were attracted by the balanced nature of Sisvel’s solution – fair rates for implementers, fair returns for their own patented technologies and a simple and efficient licensing structure for the industry. 

Critical mass was achieved and soon all the patents declared essential to the DVB-T2 standard were included in the pool. Sisvel was able to license over 1,700 patents in a truly comprehensive offering that allowed manufacturers to resolve their liabilities through a single deal. 

With all relevant patents on board, some wondered whether an increase in rates was justified. Ultimately, the patent owners accepted Sisvel’s advice to leave pricing unchanged and to focus on licensing the market completely over the long term. 

Ensuring a level playing field 

The expanded Sisvel pool brought simplicity and transparency to the licensing landscape, helping DVB-T2 become the dominant broadcasting technology in regions where DVB-T was phased out.  

On the back of these trends, the Sisvel licensing team secured agreements with over 200 users of the technology, including makers of TVs, set-top boxes and professional equipment.  

Unfortunately, some major China-based players in the TV space chose to engage in hold-out tactics. With most of their competitors having accepted the Sisvel pool’s transparent licence terms, this gave them an unfair advantage in the marketplace. 

Faced with this situation, the pool’s licensor companies had to do right by their licensees and enforce some of the relevant patents. Shouldering the cost and hassle of litigation was the only way to ensure a level playing field. 

There was very little question that the patent owners would succeed in the end, given the overwhelming market acceptance of the licence terms established by the Sisvel pool. Sure enough, all of the disputes stemming from the latest renewal cycle were eventually settled out of court, with the most recent wrapping up just a few weeks ago. 

Licensees under the programme, which are publicly listed on our website, now number 224 companies paying their fair share to DVB-T2’s innovative developers. 

The DVB-T2 standard was published in 2008, and so naturally the programme is approaching the latter part of its lifecycle as rights within the pool expire. The revenues it generated will be instrumental in taking digital broadcasting in new and exciting directions moving forward. And it has provided an excellent template for how pools can provide efficient, market-driven SEP solutions that benefit stakeholders on all sides. 

We would like to thank the pool’s licensors and licensees for all they have done to ensure its success. They have powered innovation and so delivered brilliant products to a worldwide consumer-base. Sisvel patent pools rock! 

Patrizia La Rosa is DVB-T2 Programme Manager at Sisvel 

* Sisvel's rights to grant sublicences under the Sony’s patents for DVB-T2 Consumer Products exclude Standalone Displays. For any additional information on the definition of Standalone Displays, please refer to the "Licence Terms".