Sharp to Monetize Patents Amid Focus on Ultra HD TVs, Smart Home

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  • Company says it will be more aggressive in asserting rights

    Sharp said it owns key technologies in consumer electronics

by: Susan Decker | Bloomberg | October 3, 2017

Sharp Corp.’s U.S. legal battle with Hisense Electric Co. marks the start of an aggressive new campaign by the Japanese electronics company to obtain royalties on its patents as the company focuses on ultra-high-resolution televisions and “smart home” devices.

The Osaka-based Sharp plans to be more assertive when it comes to demanding patent royalties and may even start filing lawsuits against anyone found using Sharp inventions without permission, a company executive said in an interview.

“As devices become more sophisticated and complex and interconnected, device developers really need to pay more attention to what patents are out there,” said Rey Roque, vice president of strategic business development for Sharp Electronics in Santa Ana, California. “You’ll see us asserting our rights — whether that leads to more litigation I can’t say at this time.”

Sharp’s main patent case so far has been against Hisense over Wi-Fi enabled televisions. The U.S. International Trade Commission last week agreed to investigate a complaint that Hisense is infringing Sharp patents.

Hisense is fighting the patent infringement allegation in a proceeding that could lead to a ban on U.S. imports of some of its televisions. The company filed legal papers blaming Foxconn Technology Co. for Sharp’s new push. Foxconn bought a controlling stake of Sharp in August 2016, turning the electronics maker into a profitable company.

In 2015, Hisense signed an agreement to take over Sharp’s manufacturing facility in Mexico and obtain the rights to sell televisions under the Sharp brand in the U.S. Sharp has filed a lawsuit accusing Hisense of selling low-quality products with the Sharp name.

“After the acquisition, Sharp and its new owner had second thoughts about the relinquishment of the Sharp brand for the U.S. market and began a multifaceted effort to recover or undermine the rights that Hisense acquired,” Hisense said in a Sept. 13 filing with the U.S. trade agency.

Roque declined to go into detail about the Hisense dispute, but said the company would consider litigation on a “case-by-case basis.” The Japanese electronics company does license its patents to “industry leaders,” Roque said, without naming companies.

The electronics market is increasingly tense as companies try to protect their profit margins while consumers demand lower prices. That could lead to efforts to cut the amount of royalty payments made on components or features.

“In the past, a radio was a radio and a television was a television,” Roque said. “With technological improvements, they’re really becoming more interconnected and part of larger ecosystems.”

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The push to protect its patents runs parallel to the company’s new focus. Sharp in August unveiled its new high-resolution televisions known as 8K, which the company says display images 16 times the resolution of HD TVs and at “ultimate reality, with ultra-fine details even the naked eye cannot capture.”

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