Research On Latecomer Firms' Anti-patent Holdup Strategy

Patent licensing is an important way for latecomer firms(LCFs)in the process of catching up foreign frontier firms(FFFs).Today internationality becomes the trend,patent strength directly determines the right of speaking.Through the review of the literatures and reality,we know that LCF is indeed in a weak position at the initial stage of the technological catch-up.In order to "stand on the shoulders of the giant",LCFs had to pay a high patent license fees.The high patent license fee is treated by the academy as a patent holdup.Based on the research of Lemly-Shapiro Model of patent holdup,this paper develops a modified patent holdup model between a FFF and a LCF by introducing technology gap and cost advantage,then discusses the dynamic influences of technology gap,cost advantage.Then open the blackbox of licensing parties to analyze what LCFs should do to balance the benefits between FFFs and LCFs in different contexts.First of all,build a patent licensing fees negotiation model between a FFF and a number of LCFs to verify whether the main structure has an impact on the degree of patent holdup under the external innovation situation and the anti-patent holdup strategy.With the technical capabilities of the LCF increasing,and the FFF has been internalized by external innovators into internal innovators.Followed by the study of internal innovation,verify whether the main structure has an impact on the degree of patent holdup and the anti-patent holdup strategy.Finally,we study the history of Huawei,the cause of the formation of patent holdup and the strategy used in Huawei's anti-patent holdup process.And then verify and explain the theoretical research of this paper.The results prove that patent hold-up degree between the FFF and the LCF is monotone increasing function of technology gap and cost advantage.1)With narrowing of technology gap and weakening of cost advantage,patent hold-up degree will decrease accordingly.However,the change of the relationship depends on taking the appropriate strategy in different stages and making an effort to achieve.2)When the FFF as an internal innovator,the degree of patent holdup increases with the number of LCFs.To reduce the degree of patent holdup and to obtain higher returns,the LCF can choose strategy: 1)At the initial stage of the technological catch-up,LCFs taking technology imitation strategy is more advantageous to reduce the degree of patent holdup than ex ante licensing strategy.In the situation of technical imitation,LCFs choosing litigation strategy is more advantageous to reduce the degree of patent holdup degree than the first successful negotiation.Suppose that technology gap is narrowing to some extent,the strategy to redesign products for LCFs is better.2)With the increase in technical capacity,the cost advantage of the reduction,the LCF can choose the Union and cross-licensing to achieve win-win situation.