Innovation Under Threat? An Assessment of the Evidence for Patent Holdup and Royalty Stacking in SEP-Intensive, IT Industries

By Alexander Galetovic & Stephen Haber

Many authors argue that innovation in IT is under threat.For many years Patent Holdup Theory has influenced antitrust thinking and action in SEP-intensive industries. While the theory predicts market failure, SEP-intensive industries have thrived and consumers have benefited from better products at lower prices. Is Patent Holdup a failed theory and if so, should it be used in antitrust policy?