Munich Court sets FRAND rates for Netflix and Disney+ streaming

This ruling provides the first concrete financial framework for licensing standard-essential patents within the streaming sector, where established practices previously did not exist. By setting specific per-subscriber figures for Netflix and Disney+, the court is moving to reduce the ambiguity that often leads to protracted legal battles over 5G and Wi-Fi standards. For the broader ecosystem, the rejection of patent exhaustion for streaming services means platforms cannot rely on hardware manufacturers' licenses to cover their own service delivery. Industry observers should monitor whether the 21st Civil Chamber adopts these specific royalty benchmarks in upcoming patent enforcement actions against other major SVOD platforms.

The Munich Regional Court's FRAND guidelines arrive amid a broader wave of standard-essential patent enforcement targeting streaming and connected-device ecosystems. The 7th Civil Chamber's new document consolidates reasoning from four major SEP decisions handed down earlier in 2026, including cases involving ASUS, Renault, and ZTE v Samsung. The Munich Higher Regional Court confirmed its own FRAND guidelines in the VoiceAge vs HMD dispute, finding that the defendant did not sufficiently manifest willingness to license because it refused to provide adequate security. That appellate-level ruling, which allowed a limited appeal to the Federal Court of Justice on the FRAND defence question, demonstrates that Munich courts at both levels are converging on stricter willingness standards, reinforcing the 7th Civil Chamber's two-stage test.

On the procedural and business side, the Munich courts have been refining their approach to FRAND for years. The Munich Appeals Court issued an order in October 2024 clarifying that earlier non-compliance with FRAND obligations can be remedied at a later stage, shifting the focus away from a defendant's willingness and toward whether the patent holder's license terms and royalty amounts are actually FRAND. This appellate correction of the first-instance court's previously strict approach is significant because the new 7th Civil Chamber guidelines now reintroduce a structured willingness test while simultaneously providing concrete royalty figures, effectively giving implementers both a clearer procedural roadmap and specific financial benchmarks. The chamber's rejection of a formal safe harbour concept, where implementers could have shielded themselves from injunctions by agreeing to binding arbitration, means that Netflix and Disney+ cannot simply invoke arbitration to avoid substantive engagement with patent holders' offers.

The technical and market context for these rates is shaped by the absence of established licensing practice in streaming. The earlier Munich FRAND guidelines, jointly developed by the 7th and 21st Civil Chambers, established the Munich procedure's strict-timeline framework for SEP disputes, which celebrated its tenth anniversary in 2019 and ideally leads to a first-instance ruling after roughly 12 months. The 2026 guidelines build on that foundation by introducing a top-down approach as a control mechanism alongside comparable license agreements, capping the age of suitable comparators at five years and excluding cross-licenses and multi-standard licenses from comparison. For streaming platforms, the indicative rates of approximately €0.63 per standard Netflix subscription and €0.49 per standard Disney+ subscription represent the first judicial attempt to quantify SEP obligations at the service layer rather than the device layer, a distinction that could reshape how platforms budget for intellectual property costs tied directly to subscriber counts.