IBM Fluffs Patent Portfolio with Services Tech

Published: January 18, 2010

by Timothy Prickett Morgan

For what seems like a zillion years running--alright, for the past 17 years now--IBM has come out as the top dog in the annual rankings of patents granted by the U.S. Patent and Trademark Office. A few years back, the USPTO stopped giving out data about patent counts, but market researcher IFI Patent Intelligence takes the raw patent data and dices and slices it like the patent office used to.

Like supercomputing prowess, missile counts, and gross domestic product growth, patent counts have an inherently political slant to them, and people don't like to admit it. But there are definitely some eyebrows being raised by the fact that this is the second year when more than half of the patents issued by USPTO have gone to companies headquartered overseas. By IFI's calculations, USPTO issued a total of 167,350 utility patents in 2009, an increase of 6.1 percent compared to 2008 and getting close to the all-time high that the USPTO set in 2006 when it issued a total of 173,772 patents.

Companies applied for 457,966 patents in the United States last year, down 1.8 percent from 2008 and the first time the application count has fallen since 1996. This could be considered alarming or a sign the world is moving in the right direction, only applying for patents that make sense, but most of the IT and general press focused on the fact that 51 percent of the patents issued in 2009 were to companies outside the U.S.

"It's foolhardy to use this statistic to infer that American firms are losing ground to foreign competitors because with patents it's important to consider quality, as well as quantity," explained Darlene Slaughter, general manager of IFI Patent Intelligence, in a statement announcing the figures. "What we're seeing this year is that innovation in American firms is far from declining, in fact, many had impressive gains and several posted record numbers of total new patents."

You can see the full rankings for 2009 patent issues here.

In 2009, IBM came out with 4,914 patents awarded by the United States government, up smartly from the 4,186 patents Big Blue was granted in 2008 and the 3,148 the company received in 2007. (And this from a company that is keen on patent reform.) Korean tech giant Samsung came in second, as it usually does, with 3,611 patents in 2009, followed by Microsoft with 2,906 patents (increasing at the same pace as IBM with Microsoft having only 2,030 patents in 2008 and 1,637 in 2007. Among the name-brand IT vendors, Intel ranked eighth on the award list, with 1,537 patents, and Hewlett-Packard came in 10th with 1,273 patents. HP had a few hundred more patents granted by USPTO in both 2007 and 2008.

By the way, IBM said that in addition to its patents, it published nearly 4,000 technical inventions, documents that outline inventions that Big Blue did not apply to get patent coverage for and that are freely available for anyone to use. IBM has over 30,000 active patents in its portfolio, and this gives the company legal protection against lawsuits as well as technology that it can sell. A report in Bloomberg BusinessWeek cites research by intellectual property consulting firm Ocean Tomo that says IBM's patents generated over $1.1 billion in revenues in 2009, but that its patents were heavily skewed toward services, which do not yield the big bucks like some software patents do. Such as those at Microsoft, which has a smaller patent portfolio, but which Ocean Tomo values at 3.3 times that of IBM's.

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