After some research on the markets of its technology fields, in 2006 Fractus decided to take on a new direction and change its business model. Instead of producing its own antennae for mobile devices, it would shift from direct to indirect exploitation of its inventions for mobile devices, i.e. from manufacturing antennae to licensing its patents to third parties, restricting its own production to products for less rapidly changing markets. Thus, after a due diligence procedure, Fractus opted for a dual business model: revenue from its own products and revenue via licensing of its patents.
Which steps do you think they had to follow to do this?
As a result of its continuous investment in R&D and a consistent strategy of protecting its IP, Fractus had built up a strong portfolio. As part of its new licensing strategy, in May 2009 it decided to file a complaint for patent infringement against ten handset OEMs in the Eastern District of Texas, relying on the quality of its IP.
How did patents help them in their infringement cases?
It finally settled with most of the companies in the field, including LG, Research In Motion Ltd. (makers of BlackBerry), HTC, Motorola and Sanyo, for up to US$ 70 million. In May 2011, a federal jury in Texas found that Samsung had infringed four Fractus patents and ordered the electronic giant to pay US$ 41 million, and Fractus subsequently settled with Samsung on a further pending suit. The change of business model caused the company’s turnover to go from US$ 3.6 million in 2009 to a cumulative revenue of over US$ 100 million in 2014.
Today, Fractus is regarded as an early pioneer in the development of internal antennae for smartphones, tablets and wireless Internet of Things devices. It holds an intellectual property rights portfolio of more than 40 inventions protected by over 120 patents and patent applications in the United States, Europe and Asia. Among the numerous awards and honours the company has received for its innovative work, Fractus was named a 2005 Davos World Economic Forum Technology Pioneer and has been recognised by the European Patent Office for its award-winning inventions. The company has a proven track record in innovation and licensing its award-winning geometry-based antenna technology to wireless device manufacturers in the USA, Europe and Asia.