internet

Research: Europe Lagging on AI Development; Samsung and IBM Lead in AI Patent Race – insideBIGDATA


Award-winning OxFirst, a specialist in the law and economics of IP, has released research that reveals the hidden secrets behind global patent registrations and information on the economic value of patents in the AI sector. While Samsung, IBM and Tencent dominate with the highest number of patents filed, fierce competition between the US and China overshadows other countries, including the EU.

Multiple neural nets, ML and speech recognition driving the market

Patents are mainly filed in the area of interconnectivity and system architecture, suggesting that top players focus primarily on protecting technologies covering multiple neural nets. Other areas of crucial importance are Machine Learning (ML) and bootstrap methods, alongside procedures used during speech recognition processes; e.g. the further establishment of human-machine dialogue.

An analysis of the patent landscape between 2010 and 2020 shows that patents reading on Machine Learning experienced their greatest filing growth in 2017/2018. During this time period global patent applications increased by over 68%. The research highlights just how important the global market for patents is becoming.

A sector specific analysis suggests that top players focus particularly on AI applications in the medical space. Particularly medical diagnosis, medical simulation and data mining in the medical space appear as key trends. Possibly, the current Covid-19 crisis has triggered further interest in modelling pandemics.

“To come to grips with market trends in AI, analysts traditionally study the value of corporations and the competitive dynamics within an industry,” explained Dr Roya Ghafele, Executive Director of OxFirst. “However, many ignore the fact that Intellectual Property (IP) can fundamentally restructure the economic dynamics between companies. Indeed, IP is the currency of the knowledge-based economy. Patents provide innovators with the ability to commercialize their inventions, paving the way for business success. Patents not only bear the potential to empower a company’s unique position in the market, but provide it also with the ability to generate income by licensing or selling patents. Equally, patents allow a company to make substantial savings in R&D when using the IP of others. This can be achieved by in-licensing IP or acquiring IP. As such, patents can be a source of revenue in and by themselves.”

Patent trends in AI

In the last ten years Samsung, IBM and Tencent have emerged as the most important patent owners in AI. Samsung by and large dominates the space with over 5,000 patents worldwide. Important to note is that no European company can be found among the top 20 patent owners Rather, the market appears to be led by Korean headquartered Samsung and sees otherwise fierce competition between US and Chinese firms. 

The fight for market share in the AI space is clearly reflected in the geographical assessment of patents. China, the US and the Republic of Korea report most patent filings. Compared to the over 100,000 filings with the Chinese Patent Office, the barely over 5,000 patents filed with the European Patent Office appear negligible in comparison.

Legal limitations in this space should not be ignored, however. In the EU for example, the European Patent Convention has imposed restrictions on software patents. Equally, the U.S. Supreme Court’s Decision in Alice Corp. v. Cls Bank (134 S. Ct. 2347 (2014)) established further boundaries on the eligibility of patent protection for software. Arguably, Chinese patent law may offer further scope for patent protection.

“This data suggests that companies are recognizing the economic potential of patents,” concluded explained Dr Roya Ghafele, Executive Director of OxFirst. “The analysis above helps assess how different patent owners perform in comparison to each other and how the patent space is distributed among them. Match this against a patent licensing rate of 15%, which can be caught across the sector and it becomes evident that even a small fraction of the patents in this space could offer attractive financial returns. This can be achieved by either trading the patents directly or indirectly. Even a simple assessment suggests that adopting a patent valuation perspective enables educated business decisions. After all, every investors and managers alike are keen to maximise returns while minimising risks. It is time to embrace IP as an asset.”

About OxFirst

OxFirst is a boutique consulting firm specialized in the law and economics of IP. We were several times awarded as ‘the best IP Valuation Firm in the UK.’  As a spin out from Oxford University, OxFirst can rely strongly on cutting edge economic insights.  We support technology and competition strategy through sound economic analysis.

Sign up for the free insideBIGDATA newsletter.



READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.