Functionality, simplicity, appearance, and the price are the influencing factors when consumers are choosing a phone. Thus, smartphone companies seek intellectual property protection to prevent others from replicating their creations as a way to maintain their competitiveness. Nonetheless, intellectual property rights, especially patent, have become a means to create hurdles to competitors in smartphone markets like telecommunication, handset functions and operating systems. This is due to the nature of a patent, which awards patentees with exclusivity and allows them to exclude competitors from accessing their patent. It gives right holders a chance to dominate the given markets and it is one of the main factors that constitute monopoly. Patents can lead to the dominance of the market by a single company and they can also be utilised by non-practicing entities for profit-making purposes. They may refuse licensing competitors/inventors to use essential techniques or threaten patent litigation and demand extortionate fees; competitors/inventors would have to design around to research for advanced products. If the patent is essential as a standard, their products may be eliminated in the competitive market. Apart from hindering innovation, such patent holders may also impact the price of products.In the light of this, this study focuses on the problem in smartphone industry. The US and EU competition cases and policies are analysed for identifying the problems in the smartphone industry and investigating the balance between patent protection and the competitive market. It should be possible to ensure benign competition in the smartphone industry so that, rather than using patents to strangle innovation, patents and competition law will work together in a way that responds to the needs of the information society. Hence, more advanced technology could be introduced to society, at a reasonable cost, which would boost the economic development of innovative industries
