FRAND (Fair, Reasonable, and Non-Discriminatory terms) can benefit receiving companies through commercially applicable standards and reduced concerns about open source endeavors. However, FRAND may be less successful for granting companies and market innovation. For standards development organizations, clearly defining FRAND terms with reciprocal impact is important, but such definitions risk overwhelming commercial organizations. While FRAND aims to regulate standards for long-term stability, it must also gain commercial acceptance to be effective.

1. FRAND : Friend or Foe
Dave McAllister, Director Open Source and Standards
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2. Success?
 FRAND is successful in commercial endeavors
 For the receiving companies
 For levels of protection in creating commercially applicable standards
 For reducing concerns on other open endeavors, e.g. Open Source
 But may be less successful
 For the granting companies
 For market innovation
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3. Should we de ne FRAND
 For a commercial organization, it would be desirable to have a de nition
 Legally clear and tested
 With reciprocal impact
 For standards development, a de nition is verging on mandatory
 Many different interpretations on scope and coverage
 Tit-for-tat (reciprocity) in any FRAND de nition would be highly desirable commercially
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4. Penalties in commercial behavior
 Violating a FRAND agreement
 Can cause patent engagements
 Leading to product issues
 Loss of revenue
 Loss of reputation
 Loss of trust
is is of nontrivial impact.
But honestly, NPEs don’t care, so a sufficient exclusion /withdrawal would be useful.
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5. Regulatory or Commercial?
 Simply put:
FRAND is a regulatory tool to aid in long term adoption and stability, however, it is/must be powered by
commercial acceptance.
However, FRAND must be limited in scope within standards developing organizations, since patent search
and review can quickly overwhelm commercial organizations unless directed.
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6. © 2011 Adobe Systems Incorporated. All Rights Reserved. Adobe Con dential.