5 minute read |

Are the Patent Wars Hurting VoIP?

VoIP phone service background

Patents, copyrights and trademarks are very important to organizations, regardless of the industry they operate in. Originally conceived as a means of protecting inventors from ‘me-too copycats, patents today are being used as weapons in the business world. While the copyright battle by movie and music studios against piracy is in the spotlight most often, other sectors (pharmaceuticals, technology etc. ) are rife with similar issues.

Patent Wars in Technology

The fields of computing and telephony have evolved at a very rapid pace, compared to many other traditional industries. But it doesn’t mean the companies involved have been able to bypass messy lawsuits and settlements. From big names like Microsoft or Apple to smaller startups, many enterprises have battled court cases over the last few decades.

There are some people who advocate for getting rid of patents altogether but few people have any idea on what will replace it. Other defend the current system – even though it bears no resemblance to the original incarnation or the reasoning behind setting it up in the first place.

While patents are arguably needed to allow companies to profit from their discoveries or inventions, it can be hard to decide who exactly was the true creator of a particular piece of software, equipment or technology protocol. The fact that many inventions build on previous work by others also muddies the waters. Given the rate at which technology changes, it should come as no surprise that the judges who decide such cases may not be experts on the very topics being debated in the courtrooms.

Are Patents Wars Good for VoIP?

This isn’t an easy question to answer. In theory, patents are supposed to protect companies and quite often they fulfill that function admirably. In the ever changing technological field, patents allow startups or small businesses to compete with larger incumbents. There is a very small window of time for an organization to benefit from a particular creation and patents help in making sure competitors can’t launch a similar solution through reverse engineering. Patents also encourage innovation since companies now have a financial incentive to invest in research and design.

But are we really seeing those benefits play out in the VoIP industry?

Patents Are Stifling Competition

Patents were supposed to encourage healthy competition between industry players as they race to develop better solutions. But is it really beneficial to the industry when a larger incumbent uses patents (combined with more resources) to prevent smaller startups from entering the market? The multiple lawsuits that Vonage faces today speaks volumes about the true intent of incumbents. VoIP has long been the domain of geeks and technology experts but Vonage was the first company to market it successfully to individuals and enterprises. Is it any surprise that telephone operators are at the forefront of these lawsuits?

Patent Wars Are Expensive

Of course patents wars are expensive but we’re not talking about only the costs of litigation or damages paid when the suits are settled. Such cases are damaging the VoIP industry as a whole, holding it back from growing.

These lawsuits can drag on for years or longer, with multiple appeals and countersuits. Many small businesses don’t have the resources to go through the courts in the first place.Some bigger companies take advantage of this fact and intimidate their opponents into making payments as an alternative to lawsuits. Not only do such tactics impede technology innovation, it drives home the message that there is no room for changes or growth in VoIP.

After all, who would want to enter a sector where only the big players can hope to succeed?

Technology Patents Can be Ill-Defined

Sometimes patents can be vague to the point that a company can ostensibly claim control over all future technology changes, resulting from that single patent. Imagine if all the players in the VoIP industry had to pay licensing fees to a single entity for transmitting audio over the Internet? It doesn’t matter what specific method they use or protocol they implement. If they route voice calls over data networks, they must pay.

While such a scenario might seem nightmarish, other industries have already started down that road. If the VoIP industry hopes to replace the POTS network in communication, patent wars and all the resulting fallout should be avoided.

Today smaller companies are actually at the forefront of VoIP innovation. They lead the field when it comes to adding new features or creating better solutions for client issues. Tomorrow it may be a 2 person startup that will shake up the world of telephony. Rather than throw away patents altogether, it may be time for some changes in the current system. If we start today, we might be able to avoid the damage and destruction other market sectors have witnessed.

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Start a free 30 day trial now, no credit card details are needed!