The Internet of Things (IoT) is the term applied to systems of sensors and actuators connected to networks and computers to store and analyze data. The coming wave of IoT has been publicized for several years now, as the price and size of hardware required to put sensors, processing power, and connectivity everywhere continues to decrease and as wireless coverage becomes ubiquitous. Some estimates have claimed that IoT solutions could be responsible for up to $11.1 trillion in value per year by the year 2025 as billions of connected devices are used to build data collection systems in workplaces, cities, consumer goods, healthcare, and homes.
Electronics and tech companies are working to develop the software, hardware and communications protocols that can serve as platforms for IoT technology and services. Manufactures are looking at opportunities to incorporate connectivity into their products in order to gather data on the status, use, and maintenance of their products or offer new services to customers. As an illustration, Microsoft includes the following in its list of IoT offerings: operating systems; file storage; connectivity; sensors; gesture, touch, and voice recognition; GUIs; security and artificial intelligence.
Much legal discussion around IoT has focused on privacy and data security concerns and liability concerns, but it also provokes new challenges for establishing and protecting intellectual property claims as solutions are developed that combine many different technologies and bridge between manufactured goods and software.
Understanding the challenges unique to IoT IP requires an understanding of how they fit into the patent system.
IoT patents may fall into several categories including communication methods and protocols, consumer devices, and software each of which require different strategies to ensure patentability and protection. Properly specifying the scope and content of claims can improve the strength of patents. Design patents and branding will continue to be important protections, too, as several companies compete with products that may serve similar functions. The interactive overlapping nature of IoT technology may cause issues of joint infringement, the question of whether infringement liability exists when multiple parties or devices infringe. Likewise, it will be increasingly difficult to perform prior art searches and ensure eligibility. Some say this convergence of technology will likely result in an increase in patent disputes as companies that historically have not competed enter this shared commercial space. Specifically, IoT will lead to an increase in litigation due to competitive and complex licensing agreements, the development of new patent pools, and issues related to fair, reasonable, and non-discriminatory licensing. However it plays out, the IoT wave is coming, and new challenges await.