PR Director for IPR GROUP
The Patent Cooperation Treaty (PCT), is a system which makes it possible to expand one single patent application to cover over 152 contracting States, and 4 regional organizations. It is for this reason that a number of leading and innovative companies choose to use this system in regularly applying for patents for their numerous products. In the world of innovation, patent is key.
In recent times the global trends on patent filings are beginning to see some significant changes which are worth looking into and studying, particularly when the importance of intellectual property to businesses the world over cannot be ignored. The evolution of technology is greatly impacting the world of innovation as we know it and bringing major players to the fore; creating new dynamics and taking us in a whole new direction in which seemingly anything is possible.
In 2016 the number of PCT applications in total was 233,000 with applications covering mainly five fields of technology:
Digital Communication with 17,776 PCT Applications, Computer Technology with 17,155 applications, Electrical Machinery, Apparatus and Energy at 14,468 applications, Medical Technology with 14,265 applications and Measurement at 9,338 PCT Applications. These applications originated from a number of countries, top 10 on the list as seen in the table below:
It is safe to assume at this point that digital communication has taken the lead in comparison to other fields of technology. Also, going by recent patent trends, patent filings in relation to information and communication technologies have continued to increase while there has been a decline in the share accounted for by pharmaceuticals and organic chemistry. We are also seeing a shift in the global innovation market with Asia beginning to step up and take an even bigger share than ever before. Looking at the transitions of technological revolutions from the industrial revolution of 1771 and the current age where we seem to be on the brink of another technological revolution after our transition into the age of information and telecommunication; the changes in the market share on innovation are certainly indicators of the subsequent drivers of our global economy.
Studies are showing significant changes in the innovation markets of China and the US which suggest that their IP systems are moving in completely opposite directions. Reports from the World Intellectual Property Organization (WIPO) in 2015, show that China’s patent office became the first national patent office to receive over one million patent applications in a year, which is more than a third of patent applications filed across the globe. The Chinese Government is also beginning to issue patents for software and other technologies which are mainly unpatentable in the US. The China’s State IP Office (SIPO) recently revised their rules in favour of said software related inventions. In an analysis of these changes, Richard Huang of ZY Partners summarized the revised part of the Guidelines for patent examination by SIPO which stated, “Software claims such as “a computer program product”, “a machine-readable medium”, and “an apparatus comprising a processor configured to execute instructions on a computer-readable medium to perform steps of …” shall become patent-eligible. A comprehensive protection for software related patents is now expectable. Further, it would be easier to enforce an apparatus claim with computer program as a part thereof as such construction is more close to the nature of actual product and technology.”
Furthermore, in a presentation in Moscow, Russia on patent protection for computer software in the US by Inventa Capital PLC, it was made clear that: In order to obtain a patent protection in the U.S. for computer-software related patent applications, new patent application drafting style and techniques must be adopted – claims must be more narrow and specific while the specification must be much more detailed and descriptive. This culled from a study of software related IP cases as well as their subsequent results in the US. Jack Ellis expatiated on this situation in an iam-media article where he stated, “China’s apparent embrace of software patents stands in stark contrast to the situation in the United States, which many would see as the traditional home of the software industry. The US Supreme Court’s Alice decision, other court rulings and legislative reforms that have arguably made it easier to invalidate patents, have thrown eligibility into doubt, significantly diminished the value of many existing software-related patents and, arguably, pushed business method patents towards complete extinction.” In China on the other hand, there have been recent reports on a high winning percentage for plaintiffs in Beijing’s IP court. China has also increased investments on experimental research which going by their current innovations, should possibly in the future contribute significantly to their overall GDP.
PCT AND ORGANISATIONS
The following companies were responsible for the bulk of PCT applications in 2016. It is imperative to take a closer look at their origins, what drives them and even more importantly what we should expect in the years to come:
1. ZTE CORPORATION – Telecommunications equipment and Network solutions (Shenzhen, China): With a total of 4,123 PCT Applications, a 91.3% increase from previous calculations, ZTE Corporation filed the most PCT Applications in their bid to patent their products in 2016. In a report by Ovum, a telecommunications consultancy, in 2015 ZTE was the highest-ranked Asia Pacific vendor of optical networking products and Ovum had previously reported in 2014 that ZTE had increased its annual market share in optical networking products to 28% globally, higher than any other vendor from Asia Pacific. In 2015 Ovum also named ZTE the largest gainer in wireline broadband equipment market share on a rolling 4 quarter basis ending 2015 Q2 and in the same year the company maintained the lead in 10G PON applications.
In 2016 ZTE began implementing a comprehensive evolution to 5G by enhancing the capabilities of 4G networks where existing networks provide 5G-like service experience and performance, providing users an enhanced experience even before the official commercial use of 5G in 2020.
These and many more accomplishments are quite significant strides for the telecommunications and information technology giant and proof of their mark in this age of technology. ZTE believes that there are five key trends which will play strategic roles in the current transformation to an open, sharing and digital economy. These trends which are openness, intelligence, virtuality, cloudification and the interconnection of everything, will drive innovative advances and collaborations across various fields. ZTE intends to focus on these trends abridged into the acronym, VOICE, over the next few years.
2. HUAWEI TECHNOLOGIES – Networking and telecommunications equipment and services (Shenzhen, China): Less by 5.3% on their PCT Applications in the previous year, Huawei filed a total of 3,692 applications in 2016. This is still a considerable amount in contribution to the total number of patents filed for in the year. If the message from Ken Hu, Rotating CEO of Huawei is anything to go by, we are sure to see even more patents and innovation from this leading information and communications technology solutions provider in the coming years. At HUAWEI CONNECT of 2016 which held in Shanghai, Ken Hu disclosed that the company aims to position itself as the enabler and driver of an intelligent world and as such would hold true to its culture of customer-centricity, focus on ICT infrastructure, and the provision of innovative cloud technology. During the event Ken Hu stated that “In an intelligent world, devices will play the role of “feelers” in an all-sensing environment. Networks will connect everything, and the cloud will be the source of intelligence behind all things. These three elements form a synergetic architecture of devices, information pipes, and cloud.” Based on this understanding, the company is focused on building technological infrastructure which will integrate devices, pipes and the cloud, and serve as the backbone for an intelligent world. These three defining characteristics will be the strategic focus of Huawei’s investment in the near future.
3. QUALCOMM INCORPORATED – Telecommunications, Semiconductors (California, U.S): The telecommunications company dedicated to quality communications was up by 1.0% from the previous year with a total of 2,466 PCT Applications in 2016. This is the same year in which Qualcomm announced their new 3G and 4G Chinese Patent License Agreement entered into with Gionee Communication Equipment Co. Ltd. where Gionee was granted a patent license to develop, manufacture and sell 3G WCDMA and CDMA2000 and 4G LTE complete devices for use in China.
Also in 2016, Qualcomm resolved all of their earlier patent disputes with Meizu Technology Co., Ltd., and better yet entered into a patent license agreement with the Chinese smartphones company where the smartphones company was granted a worldwide royalty-bearing patent license to develop, manufacture and sell CDMA2000, WCDMA and 4G LTE by Qualcomm. This greatly pleased Mr Bai Yongxiang, President of Meizu who stated that, “It was a nice coincidence we are able to at this juncture push forward with the equal and fair negotiation with Qualcomm. We are confident this cooperation with Qualcomm will add tremendous value to our user, channels, shareholders and employees.”
In October of 2016 Qualcomm also announced entering into an agreement in which the company would acquire NXP Semiconductors N.V., the Dutch global semiconductor manufacturer, and following the agreement the company would commence a tender offer to acquire all of the common shares of NXP. This arrangement has substantial strategic and financial benefits which will definitely result in a higher degree of innovation from Qualcomm.
4. MITSUBISHI ELECTRIC CORP – Electronics and electrical equipment (Tokyo, Japan): The company saw an increase on their PCT applications with a total of 2,053; 28.9% more than the year before. This increase is great news by the way of innovations as the leading manufacturer and seller of electrical and electronic products and systems had quite a number of stellar achievements in 2016. At the tail end of the year, the company announced their achievement of three Guinness World Record titles for their elevators operating in China’s tallest building. The 632-meter Shanghai Tower in the categories of Fastest lift (elevator), Fastest double-deck lift (elevator) and Tallest lift (elevator) in a building. The certificates were received on the 8th of December 2016 during an event at the Mitsubishi Electronics head office in Tokyo.
Also in 2016, Mitsubishi in collaboration with the Research Center for Advanced Science and Technology of Tokyo University (RCAST), developed the world’s first Real-time Crowd-congestion Estimation System which analyzes data in real-time from surveillance cameras for high-accuracy estimation and prediction of crowd congestion on pathways to and from event sites. This new system possesses an 80 percent accuracy rate, approximately 30 percent higher than that of standard methods. It is hoped that this new innovation will be useful for increased security and visitor safety at events. Mitsubishi carried out a field demonstration of the new system in August of 2016, at the 38th Tamagawa Fireworks Festival in Tokyo, Japan.
5. LG ELECTRONICS – Consumer electronics, Home appliances (Seoul, South Korea): In 2016 the all popular electronics company saw a 29.6% increase in PCT Applications with a total of 1,888 applications higher than the year before. President and CEO for LG Electronics USA, William Cho was quoted saying that, “Delivering innovation for a better life is the foundation of LG’s product strategy for 2016,” and this principle truly reflected in the products unveiled in Las Vegas at CES 2016 where the company left with 55 awards to its name, leading with the best-of-show honors for the LG SIGNATURE refrigerator and their new LG SIGNATURE G6 OLED 4K TVs. In September of the same year, LG was named an Industry Group Leader in the Consumer Durables & Apparel Industry Group category the third year running, by the Dow Jones Sustainability Indices (DJSI) review. Still in 2016 the electronics company emerged the clear winner in the Red Dot Awards for design excellence with 30 Red Dot Awards and two Best of the Best awards.
In the words of Noh Chang-ho, head of LG Electronics’ corporate design center, “LG is committed to design excellence and these awards are affirmation that we are on the right track.”
LG Electronics was also awarded the Gold Class distinction in RobecoSAM’s 2016 Sustainability Yearbook at the World Economic Forum in Davos, Switzerland and was named one of the Global 100 Most Sustainable Corporations in the World by Corporate Knights in the third year running.
6. HEWLETT-PACKARD – Information technology (California, U.S.): A 33.0% increase in PCT Applications resulted in a total of 1,742 applications in 2016 for the information technology company. Following the split in 2015 into HP Inc. and Hewlett Packard Enterprise, Hewlett Packard Incorporated was able to improve its focus on the PC and printer markets while Hewlett Packard Enterprise’s focus is on its enterprise products and services businesses. Hewlett Packard Enterprise was founded on the 1st of November 2015.
2016 was all about reinvention for HP Inc. as it announced a range of news, product innovations, programs and services aimed at delivering value to its worldwide network of over 250,000 partners at the HP Global Partner Conference (GPC) in Boston Massachusetts in September of 2016. At the conference, president and CEO of HP Inc., Dion Weisler stated that, “The needs and expectations of our customers are changing rapidly, and change creates opportunities for HP and our partners,”… “Backed by the channel who are critical to our go-to-market strategy, HP’s innovations are powering business and industry transformations. Together, we can seize these new opportunities and drive profitable growth today and in the future.”
The announcements included a deal of over $1.05 billion in a definitive agreement to acquire Samsung Electronics Co., Ltd.’s printer business. In support of its efforts to reinvent business printing, the company also introduced an extensive line of A3 multifunction printers (MFPs) and services. HP is set to pioneer entirely new categories which benefit its customers and transform business models together with its partners.
7. INTEL CORPORATION – Semiconductor computer circuits (California, U.S.): The Intel Corporation was up 35.4% in 2016 with a total of 1,692 PCT Applications and it seems there would be even more increase in the coming years as in the words of Brian Krzanich, Chief Executive Officer of Intel at the CES Las Vegas in 2016, “There is a rapidly growing role for technology that is at once transformative, unprecedented and accessible,”… “With people choosing experiences over products more than ever before, Intel technology is a catalyst to making amazing new experiences possible, and ultimately improving the world in which we live.” Krzanich stated that there are three trends which are shaping the future: the smart and connected world, technologies gaining human-like senses, and computing becoming ultra-personal. At the Consumer Electronics Show, the semiconductors company announced a number of collaborations, innovative technologies and products which would make the amazing possible. Intel announced plans to collaborate with a number of leading industry brands to provide Intel-powered solutions which would use technology to benefit people’s overall health, fitness and athletic performance, empower athletes and bring amazing experiences to life in sports as well as in music.
In a company editorial in April of 2016, Krzanich described the company’s strategy as the transformation of Intel from a PC company to a company that powers the cloud and billions of smart, connected computing devices. This strategy is based on five premises: The cloud and data center, the many variations of connected things, memory and programmable solutions, connectivity, and last but certainly not least, Moore’s Law. Krzanich also stated in the editorial that, “We are in a time when technology is valued not just for the devices it produces, but for the experiences it makes possible. Intel will lead in this new era by remaining true to our history as inventors and makers, as a global leader in manufacturing, as world class innovators.” … “It is an incredibly exciting time for Intel as we accelerate our strategy, and our impact. The work we do at Intel today will change this company, our industry and the world.”
8. BOE TECHNOLOGY GROUP – Semiconductor display technologies, products and services (Beijing, China): The Beijing-based technology company saw a 36.3% increase in PCT applications in 2016 with a total of 1,673 submissions, but there was even more good news as it ranked first in the world in 2016 with the most approved patents in the year at a total of 7,570 patents in its three main businesses; smart systems, display devices, and healthcare services.
BOE’s manufacturing bases are located in Beijing, Chongqing, Hefei of Anhui Province, Chengdu of Sichuan Province, Gu’an of Hebei Province, Ordos of Inner Mongolia Autonomous Region, Suzhou of Jiangsu Province and Xiamen of Fujian Province. The electronics company also has a global marketing and service network which covers the world’s major areas including Europe, America and Asia. With over 40,000 usable patents, the company focuses on the innovation concept of “Technology Leadership, First-global-launch Products, and Value Co-creation”. BOE’s management philosophy is, “Making progress through innovation, managing the enterprise with integrity.”
9. SAMSUNG ELECTRONICS – Consumer electronics, Semiconductors, Home appliances (Seoul, South Korea): The consumer electronics company saw a decline in its PCT applications in 2016 with less 0.7% at a total of 1,672 applications. However this doesn’t take away the fact that 2016 was an adventurous year for the company. In October Samsung Electronics ranked 7th in Interbrand’s “Best Global Brands 2016,”, continually demonstrating the growth in their brand with a brand value of $51,808 million as they have ranked within the top ten, five years running.
The company also announced in November of 2016 that it had won 35 prestigious International Consumer Electronics Show (CES) 2017 Innovation Awards, given by the Consumer Technology Association. President and CEO of Samsung Electronics North America, Gregory Lee stated, “At Samsung, we are constantly working to improve with each product we make,”… “We are honored that CTA and the industry have recognized our ongoing commitment to innovation in many areas, and we look forward to showcasing our latest offerings at the 2017 Consumer Electronics Show.” Samsung also became the winner of “Innovations Time” awards which was held with the support of the Ministry of Economic Development of the Russian Federation. The ceremony held on the 16th of December in Sochi.
One notable occurrence was Samsung’s part in the Rio Olympics where the company played the part of Worldwide Olympic Partner in the Wireless Communications Equipment category and took connectivity and digital interactions to the next level for athletes and fans alike. In light of the event the company held a #DoWhatYouCant campaign, which achieved more than 1.6 billion social impressions and engaged almost 121 million fans. Metrics proved that the Rio 2016 was one of the most connected Olympic Games in history. On its website the company states that the Vision 2020 is at the core of its commitment to create a better world full of richer digital experiences, through innovative technology and products.
10. SONY CORPORATION – Consumer and professional electronics, gaming, entertainment and financial services (Tokyo, Japan): Sony submitted a total of 1,665 PCT applications in 2016 which resulted in a 20.6% increase from the previous year. Among their innovation related successes of 2016, the European Imaging and Sound Association (EISA), renowned for recognizing true quality and innovation, honoured Sony with 5 awards in various categories. Also in recognition of their strides towards minimizing their environmental footprint and producing environmentally conscious products and services in a bid to meet their “Green Management 2020″ target of an environmental footprint of zero, the CDP Japan 500 Climate Change Report for 2016 recognised Sony as a Leader in Combating Climate Change the second year running. In the same year Sony announced their acquisition of Altair Semiconductor, the Israeli Innovator of LTE Modem Chip Technology; the company also acquired UK’s leading dance label, “Ministry of Sound Recordings” later in the year. The electronics company also succeeded in establishing a partnership with Bosch Security Systems in the field of video security solutions.
Kazuo Hirai, President and CEO for Sony Corporation stated at a press conference in January of 2016 that, “…Providing kando continues to be the core focus and goal of our business.” Kazuo has describe kando, a word from the Japanese culture, to mean “emotional involvement. The power to simulate an emotional response.” He stated that, “…All Sony products must be inspired by a spirit of kando.” Due to this idea and inspiration, we look forward to seeing even more innovation from the electronics giant.
Even though the preceding ten companies were chosen by ranking of PCT applications alone, it is important to take a peek at the statistics surrounding global patent applications as well. 2016 saw a total of 3,127,900 patent applications with an exceptional amount being filed at the State Intellectual Property Office of the People’s Republic of China (SIPO). This result stemmed from 98% additional filings in China from the previous year to the total of 1.3 million applications; this amount being more than the applications received by the United States Patent and Trademark Office (USPTO) at 605,571 applications, the Japan Patent Office (JPO) at 318,381 applications, the Korean Intellectual Property Office (KIPO) at 208,830 applications and the European Patent Office (EPO) at 159,358 applications, all combined. This paints a picture that it is not just the innovation market which is growing steadily in Asia, but also residents of other countries see this part of the world as a growing market worthy of investment.
Top three countries in 2016
WIPO statistics database and World Bank in 2017 showed reports on Patent applications in relation to GDP and population using GDP data of 2011 US PPP dollars. In the report which showed the top 20 origins for Resident patent applications per USD 100 billion GDP, the Republic of Korea was top with 9,703 resident applications in 2006 as opposed to 9,115 in 2016; this was closely followed by China with 1,455 resident applications in 2006 and then 6,069 in 2016. Japan came a close third with 7,511 resident applications in 2006 and 5,359 applications in 2016. The US was sixth on the list with 1,469 resident applications in 2006 as opposed to 1,716 in 2016.
The vision of each one of the companies listed above as well as the statistics on patent and PCT applications so far can tell us that in the world of IP and technology we are beginning to see significant growth in the amount of innovation coming from Asia and we should expect even more in the years to come. Also information technology has evolved to become the main driver of the economy, and IT related companies are connecting even more with the global populace as they base their innovations on the experiences they can give to consumers. There are significant changes occurring at this very moment, and IP is set to play a huge role; because in the world of innovation and ideas intellectual property must be protected and the drivers of industry are changing much faster than before, looking back at the beginning of the electronic age as well as all known drivers of industry in time past.