China's telecom patent boom - Is China Ready to Enforce IP?

Tom Keating : VoIP & Gadgets Blog
Randy Savicky
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China's telecom patent boom - Is China Ready to Enforce IP?

China has a reputation for not enforcing other countries' patents and copyrights, including bootleg DVDs that can be found in just about any major Chinese city street corner. It was even alleged that China's telecom giant Huawei stole Cisco's routing software. According to one article:
Bootleg DVDs in China are very slickly produced and packaged. In fact, many have extra features that make them better than those found on legitimate discs. This is a huge business. According to a report issued by the state-run media, the country’s pirate DVD industry totaled approximately $6 billion in 2010. China’s box office receipts, on the other hand, totaled a mere $1.5 billion for last year.

But things are starting to change in China. A Reuters article today talks about how China's telecom giants are dramatically increasing their patent applications and starting to enforce intellectual property (IP) rights.

Via Reuters:

The influx of patents not only underscores China's growing strength in the telecom sector, it also reveals a change afoot in the country's attitude toward intellectual property.

While the change is hardly air-tight, China is moving more toward recognising ideas and their origins, rather than copying and proliferating.

Intellectual property civil litigation cases filed in China rose by 37 percent to 41,718 last year according to the country's Supreme People's Court.

This is driven in part by China's plan to become a high-tech power house, with a target for 2.5 percent of its gross domestic product to come from research and development by 2020. It's trying to reach this goal by subsidising the cost of patents for Chinese companies and stricter enforcement of intellectual property rights.

They may be increasing their enforcement of "some" intellectual property rights, but bootleg movies, counterfeit software and music is a part of the Chinese culture. It might be easier for China to enforce telecom patents since it's easy to catch and scold telecom companies than it is for them to stop a street vendor selling bootleg movies. Though truth be told there are even stores in China boldly selling counterfeit materials with little fear of prosecution.

The telecom sector is red-hot, especially the mobile telecom space, and China is on course to surpass Japan and the U.S. in the number of patents. Perhaps soon China will be the world's greatest "innovator" and it will be the U.S. that "copies" China. So not only will China own a huge chunk of the U.S.'s debt, they'll also own patents that U.S. companies will have to license or find creative workarounds. My how times have changed.



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