This article by Koren Wong-Ervin and Jorge Padilla considers the merits of recent complaints about the common industry practice in many technology industries, including the wireless industry, of licensing patents at end-device level (as opposed to at component-part level), and the use of the entire value of the end device as the royalty base for the calculation of compensation. The article identifies the exceptional circumstances under which mandating licensing at component level may be justified from a welfare perspective. It also explains why using the entire value of the end device as the royalty base is optimal.