How will licensing IP in the autonomous vehicle space be different?

Autonomous vehicle IP licensing will have all the problems we saw with smartphone IP licensing, but on steroids. Here’s a short list:

  • Damage base is bigger. Value of the end product is bigger (i.e. cars vs smartphones), so royalty demands are bigger. There will be a correspondingly wider range of “acceptable” royalty amounts and FRAND offers.
  • Injunctions are more dramatic. And lock-in is more severe. You can’t roll a software update on a week’s notice just due to the safety / regulatory issues. You can’t substitute a new chip at the factory as you soon as you’re convinced it’s good. Also, is Germany seriously willing to enjoin the sale of a car because some random chip inside it infringes? This is going to put a lot of pressure on proportionality in legal systems.
  • Whole new issue: safety! Safety issues will dominate (perhaps out of proportion to the actual risks), and the safety issues will supercharge everything from mandatory licensing to pricing to cybersecurity.

Auto manufacturers have so far avoided massive IP battles, and have insisted that their suppliers take care of IP and indemnity issues. This has not been done in the smartphone space. Which model will prevail?