Five months to the day after I said the Avanci patent pool had licensed "virtually [the] entire automotive industry" to the 4G cellular standard-essential patents (SEPs) of more than 50 licensors, Avanci has announced a "dedicated patent licensing program for the vehicle aftermarket" called Avanci Aftermarket.
It may seem counterintuitive, but the number of devices with cellular connectivity that owners install subsequently to the delivery of their vehicle--such as trackers, toll collection devices, and monitoring systems--is comparable to the number of cars that come with built-in cellular connectivity. Avanci's press release refers to Berg Insight's study on the global vehicle telematics hardware market, according to which there is "an annual market [for aftermarket telematics products] of over 45 million units today, with growth forecast to more than 70 million units in 2026."
The initial group of licensors includes more than 40 patent holders, which is obviously a far wider circle than when the Avanci automotive pool started. While a minority of the contributors to the automotive pool are not on board from Day One, some may join later, as Nokia did before (and may do again). The two largest SEP holders I found on the list are Ericsson and Qualcomm.
There are also some initial licensees: "a company collecting road tolls and a leading provider of intelligent transport systems for the public transport sector." It's always a good sign for a new pool when the first licensees have already signed up by launch time.
The new pool makes licenses available for three types of products defined as "monitoring only, infotainment, and other multi-function products." Monitoring (i.e., fleet tracking such as by car rental companies or large corporations that own many cars) is the most limited application. The pool's website defines such devices as being "only capable of monitoring and/or reporting on the performance, activity, location, usage, driving characteristics, or faults of a vehicle or container but without a user interface for receiving or presenting any information to anyone traveling with or inside the vehicle or container, and without the ability to control the operation of the vehicle or container." The license fee for that is only $3 per unit if the latest supported standard is 3G, and $4 if it's 4G.
For infotainment products (such as aftermarket navigation systems), the license fee is $9 per unit up to 3G, and $15 per unit if 4G is included. That number sounds familiar: it was the Avanci automotive patent pool's 4G rate from its creation until last summer (when Avanci issued a final boarding call to automakers prior to an increase to $20). Aftermarket infotainment products make use of cellular standards in a way that is very similar to built-in connectivity, so I wouldn't be surprised if the license fee for those devices was increased to $20 as well, further down the road.
The pool's website defines infotainment products as "connected devices with the capability to download apps, play audio content or other entertainment, access Internet-enabled content such as traffic or weather conditions, and/or provide network connectivity for a wireless local area network such as a Wi-Fi hot spot."
The royalty rate for "other multi-function products" is in between ($6 up to 3G; $7.50 for 4G). The pool's website explains that this is the broadest category and basically covers anything that is not as feature-rich as infotainment products, but capable of more than monitoring:
"On board units and computers that communicate with other vehicles, ticket machines and ticket printers and other fleet management devices such as taxi dispatch systems, dash-cams, and toll collection devices with user interface for presenting information to the driver fall into this category."
Avanci's press release quotes Marianne Frydenlund, whom many in the wireless patent licensing community already knew in her Nordic Semiconductor years:
"With our experience in creating the one-stop licensing marketplace for connected vehicles, the addition of vehicle aftermarket devices is a natural extension that builds on that success. We are committed to providing efficient licensing solutions for new categories of connected products as the Internet of Things expands."
Mrs. Frydenlund is a renowned expert in IoT licensing as Nordic makes chips that power IoT products and entered into interesting agreements with Nokia as well as Huawei. Wireless aftermarket products for cars fall into certain IoT categories (such as asset trackers, which don't have to transmit large amounts of data, but they have to report their GPS coordinates from time to time).
What made Avanci's automotive SEP pool succeed should also work in favor of this new pool for aftermarket products. Device makers need those licenses, and a one-stop shop provides transactional efficiencies for both licensors and licensees. The rates are consistent with the royalties paid by makers of products that provide similar functionality. I would expect rapid adoption of this pool by aftermarket device makers, knowing that car makers, after some initial reticence, signed up in droves, especially last summer ahead of a royalty hike that would otherwise have applied to their licenses.
IAM previously reported on this announcement (paywalled).
