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Big tech should be doing a lot more to put its patenting house in order

For the 21st year in a row IBM has shown itself to be the best company in the world at obtaining US patents. According to data assembled by IFI CLAIMS, Big Blue received 6,809 grants in 2013, that’s over 2,000 more than perennially second-placed Samsung, which saw its number of grants go down a little compared to the previous year.

The patents that IBM chalked up last year are over double the number the company received in 2007, the first year for which the IAM blog reported on this issue. Back then, the figure stood at 3,148. So that’s quite some achievement by chief patent counsel Manny Schecter and the team that he leads. They have a patent harvesting operation that is second to none.

When you see the headlines that these stats produce - “The most innovative companies in the world” from USA Today, for example – you can see exactly why so much time, effort and money is invested in coming top. Such publicity is absolute gold dust for Big Blue and does more than any number of marketing campaigns to bolster its image as an “innovator”. That the number of patents a company is granted actually tells us very little about its capacity for innovation is neither here nor there – as long as people think it does, that’s all that matters. And once you’ve got the headlines, you can then get down to making a proper assessment of the rights you have and abandon a large number of them.

While on one level you cannot blame IBM and other big technology companies for the number of applications they submit and the number of grants they receive, you do have to wonder whether their voracious hunger for grants is one of the reasons why the USPTO has so often struggled with quality and timeliness. It does not take a genius to work out that the more applications an examiner is asked to deal with, the less time he/she will have to assess each one. While you would wish it otherwise, the practical reality of this is that backlogs develop and, at times, patents that should not be granted do get granted. And, as we all know, such patents can end up in the hands of bottom-feeding trolls who then seek to assert them against unsuspecting entities and individuals in the hope of getting some licensing cash.

For big tech companies, whatever they say in public, this is not a huge problem – they know how to assess patents and can respond to trolls and other asserters accordingly; but for those that do not work with patents day in and day out, getting a letter alleging infringement creates worries at best and at worse may end up costing money that could be put to much better use; they have no idea about the quality or lack of it of the patent concerned. But it’s not only that: big tech companies can afford to wait for their grants, smaller companies and start-ups – which may need patents to attract and retain investors – are not in that fortunate position. If they get stuck in the queue behind an IBM, a Samsung or a Microsoft, then that could prove terminal.

Of course, big tech will respond that if the USPTO were properly funded and did not have to depend on legislators allowing it to keep the money it raises, then its leadership could plan properly and invest long-term in examiner recruitment and retention, training programmes, IT upgrades and many other things that would allow it to improve its performance. And that is absolutely right. This year, the office seems to have got a good a good deal from Congress; but that often has not been the case in previous years and may not be so in those to come.

But the fact is that big tech knows the score and understands fully the constraints the USPTO faces. Those 300 or so senior patent counsel whose companies own over 50% of all active US patents must therefore realise that their tens (maybe hundreds) of thousands of annual filings can only make things more difficult and will inevitably cause serious problems for others further down the line. There’s a part of me that thinks that if these companies truly cared as much as they say they do about fostering innovation and invention in the US they would be doing a lot more internally to ensure that what gets sent to the USPTO really is worth having in the first place. I am sure that there is more that the office itself could be doing to improve its service, but I find it impossible to believe that when a company such as IBM ends up abandoning over 40% of its patents within four years of receiving them, there is also not a hell of a lot more that big tech could be doing to put its own patenting house in order.  

Joff Wild
IAM Magazine
19 January 2014

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