Confidentiality:FRAND terms are usually not made public. Only the parties involved knows what is terms and conditions are licensing and how much royalty is involved. FRAND seldom allows sublicensing to the third parties, in a way that requires no further action from the sublicensee to obtain the same rights to implement the standard. If such is a scenario in open source software then FRAND is difficult to co-exist with open source as applying same terms and conditions for each distributed copy would mean to make those conditions public and to apply same for each distributed copy at each level which is not possible.Royalty Tracking:Distribution of several copies of software makes it difficult to track the copies and obtain the royalty per copy. This would also require additional terms and conditions for royalties as distribution on a more than second level basis would make it more complex to decide who would receive the royalty, the original source code creator or the one distributing the software. Also, the complexity of software and royalty calculation can never be exact and will always be complex.
Redistribution:FRAND does not permit to redistribute the software to downward recipients by itself as it requires to keep track of royalties and to make sure that the terms are followed for each copy. This is practically impossible as there could be thousands of copies and infringements would be very difficult to keep trail of.An obstacle to Innovation:One of the most important principles of OSS is that it promotes innovation by implementing novel ideas and developing solutions to more complex issues and problems. A community of people that do not compete with each other but just works together in creating new resources and opportunities for others to benefit from these resources. An advantage of which is in-depth analysis of the problems and varied applications.
If there are legal and monetary barriers to every contributor it has serious consequences for innovation.Freedom to operate:Developers in Open Source communities are granted enough freedom to make use of free software and modify it based on their own ideas and needs. There is no regulation on how the code can be modified and either used for personal or commercial purposes. FRAND wholly defuses the collaborative open model behind OSS, by limiting the use of freedoms granted by the latter.
Overhead to find the correct patent holder:One of the biggest issues in Open Source environment is to find the correct holder of the patent. It is a big issue for researchers as well as the developers. For example, researchers tried to find out about the licensing requirements for the ISO’s TIFF/EP standard, for which 19 organizations were listed in the ISO patent database.
Once more, the researchers sent out letters asking for licensing details, and of the 19 contacted, not a single one replied(Moody, 2018).The complexity of relationships for patent holders:SEPs requires each patent holder to create private relationships with community contributors. One open source community can have several thousand of participants. It is simply not practicable to have a relationship with each and every person in the community and it just conflicts with community-based open innovation and teamwork approaches.The threat of discrimination:One of the basic requirements of FRAND is to contact the SEP holder for obtaining a license. In such a scenario to grant license totally depends on the holder of SEP in which there is a threat of discrimination as SEP holder cannot define which individual can be under a similar category. Discrimination is neither compatible with OSS principles nor with FRAND itself.
Blanket Claims:Lots of companies are famous for blanket claims, which happens when they declare that they own SEP without specifying any details of such patents.This possesses a grey area in the accuracy of information related to patents and causes difficulties for any developer to use any patent that does not have a proper information available.Consequences for SMEs:Small and Medium sized enterprises especially the ones that are just starting to make entry in the market rely on free and open source projects to start up. The don’t possess huge capital to invest on buying patents.
A major setback for SMEs would be to pay up for software. This will not only hinder the market entry of such companies but also would set back the innovation and research capability on the technology.Threat to interoperability:The science of Internet, Web and OSS is different from telecommunication sector.
SEP holders in such a sector could prevent interoperability in order to reduce the competition and make utmost profits. Consider a scenario where your web browser works only with certain web pages and not all. If proper attention is not paid it would give monopoly to patent holders in the open source industry.Threat of future implications:For every participant there is a threat from current and future owners of the patents. Incase of an influential owner of the patent in the future , it could exert more market influence without even taking part in the project.
This could lead to serious business implications for the participants and their future in the market and industry.Patents and Open source software can never go together. The basic principles on which open source is developed is to provide anyone the ability to use the software , modify , use it according to their will and redistribute it to anyone. SEPs and FRAND with their terms and conditions defies all this. They originated from another sector and through traditional SSOs, while software and web standards have advanced in a more cooperative way, i.
e. through fora and consortia(Bohannon, 2018).FRAND cannot govern OSS.