Ericsson essential patent pricing probed
India's antitrust regulator has launched a probe into Ericsson over allegations the company is making excessive royalty demands for standards-essential patents.
The Competition Commission of India (CCI) has initiated the case based on a complaint by fast-growing Indian handset maker Micromax.
The official order has been published and disseminated by technology patent news blog FOSS Patents.
It states that the CCI is taking the preliminary view that Ericsson has adopted royalty and licensing practices that are both discriminatory and contrary to the fair, reasonable and non-discriminatory (FRAND) terms that are supposed to govern standards-essential patents.
In particular, it asserts that Ericsson is adopting royalty base rates that have no linkage to patented products, and charging a higher royalty rate for more expensive smartphones even though it made no contribution to justify the increased cost.
FOSS Patent's Florian Mueller notes that regulators in the US and EU have so far been reluctant to address the issue of what is an appropriate royalty base rate, even though this issue is often at the heart of most allegations of standards-essential patent enforcement abuse.
While Indian officials might not quite have the heft of the Chinese government – which this week commenced an antitrust probe of chipmaker Qualcomm - the sheer size of the Indian mobile market means Ericsson will likely have to take the investigation seriously.