Intellectual Property Rights In The Telecom Industry

Introduction

From the first working electric telegraph line that transmitted electrical signals through wires, to today's high speed 5G networks, the telecommunications sector has evolved into one of the fastest-paced and most influential industries in the modern global economy. The telecom industry has drastically transformed how people communicate and interact and is constantly evolving, even today, to meet the ever growing demands.

Telecom industry's growth and competitiveness are based on innovation. Pertinently, the basis to promote innovation and support constant growth is, to the largest extent, attributed singularly to effective management of intellectual property. Intellectual Property ("IP") refers to any creation of one's mind, such as one's ideas, industrial models, invention, trademarks, software, algorithms, trade secrets, etc. Intellectual Property Rights ("IPR") is the legal protection granted to creations of one's mind, when such creation carries commercial value. IPR rewards creators with exclusive rights in their intellectual assets for a limited period, which incentives creators to research and innovate further; and resultantly enhance competitiveness in their respective industry.

Telecom Industry – An IP powerhouse

A high-tech industry, such as the telecom industry sustains on advanced scientific knowledge and cutting-edge technology that includes numerous IPs belonging to several IP owners. This article analysis the different IP assets belonging to the telecom industry and how they are protected under the Indian IPR Regime:

• Patents: The Indian Patents regime protects products and processes that are (i) novel, i.e., not existing in the public domain; (ii) are inventive, i.e., the product or process is not obvious to a person skilled in the art; and (iii) have industrial applicability, i.e., the product or process can be utilized in a commercial industry. For instance, exclusivity over networking techniques, software interfaces, modular hardware or silicon chips can be obtained for a period of 20 years by protecting these innovations under the Patents Regime.
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• Trademarks: A trademark is a source identifier that differentiates the goods and services of one service provider from those of others. A trademark signals the origin of goods or services, helping consumers recognize quality and avoid confusion in the marketplace. The Trade Marks Regime safeguards the brand identity of telecom operators, helping them build customer loyalty and differentiate their services from their competitors. Pertinently, unauthorized use of trademarks must be monitored not only in the physical market place but also in the digital space, which is witnessing a rise in cybersquatting. Cybersquatting refers to the illegal act of registering a domain name that is identical or similar to a prior registered trademark, so as to wrongfully reap benefits from the resultant consumer confusion. It is imperative that Telecom companies remain vigilant and take immediate legal action to protect their trademarks from such unauthorized use.
• Copyright: The copyright regime protects a creator's rights to use and monetize their original literary, artistic, musical, and dramatic works, films, sound recordings, and software. Specifically in the Telecom industry, exclusivity of inter alia copyrighted software, original digital content, hardware reference manuals, signal analysis methods, to name a few is extremely critical. Copyright laws ensure the creators/ owners of these works maintain strict control over the use of these IP assets.
• Trade Secrets: Trade secrets are confidential business information which provides a company a competitive edge over its competitors in the telecom industry. In India, trade secrets are primarily governed by common law principles under the Indian Contract Act, 1872, and the Indian Copyright Act, 1957 that bind stakeholders to keep sensitive information protected.

A landmark judgement that illustrates the interaction between IPR in the telecom sector in India is the case of Telefonktiebolaget Lm Ericsson(Publ) vs Lava International Ltd ((2024) 310 DLT 482). Ericsson, a significant global SEP holder, alleged that Lava was using its patented technologies without paying appropriate royalties and sought injunctions and damages. Lava countered that Ericsson's royalty rates were excessive and discriminatory, violating its FRAND commitments. Briefly, Standard-Essential Patents ("SEPs") are patents granted for technologies that are indispensable for complying with telecom standards, for example, Global System for Mobile Communications ("GSM"). Given their mandatory usage to build other standard-compliant devices in the telecom industry, SEP holders are mandated to license their IP to third-parties on FRAND terms, i.e., Fair, Reasonable and Non-Discriminatory terms so that licensing is not unfair, excessive, or discriminatory. The aim is to ensure that SEP owners do not abuse their dominant position in the market.

After prolonged litigation, the Delhi High Court on March 28, 2024, awarded damages in favour of Ericsson; and held Lava liable for infringement of Ericson's SEPs. The court found Lava guilty of not negotiating in good faith, making it an 'unwilling licensee' and justifying the damages.

On the trademark front, industry leaders regularly and actively take action against unauthorized use of their brand names by third parties, employing administrative, civil and criminal remedies as well as pursuing cancellation action against rouge domain names to maintain the exclusivity of their trademark assets. Litigation action against unauthorized reproduction and use of copyrighted software is also actively seen in the telecom industry. Circulation of counterfeit telecom products such as mobile phones is extremely common in India. This not only erodes the IP owners of their hard-earned profits but also poses a risk to consumer safety. Companies regularly monitor markets to timely enforce their trademarks rights, and also collaborate with authorities to prevent counterfeiting as well as educate consumers via joint efforts to increase consumer awareness.

Conclusion – IP as a Strategic Asset

IPR is indispensable in the telecom industry's growth. Given the wide array of protection provided to different assets under the Indian IPR regime, strategic IP protection goes beyond legal protection and in fact, plays a vital role in shaping dynamics in the telecommunications industry. IPR management not only rewards and motivates researchers, creators and innovators; but also influences market competition and consequently aids in the over-all development and commercial success of telecommunication entities.

These reasons are more than enough to conclude that early protection of creativity, innovation and intellectual investment, coupled with diligent transfer and licensing of IPRs ensures long-term success and growth in the thriving telecommunication industry.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.