IEEE Patent Report Reveals Shrinking U.S. Innovation Pipelines

For the first time in more than a decade, U.S. patent activity did not increase in 2008 over the previous year, according to IEEE Spectrum's Patent Power rankings. The annual report, which ranks companies, universities and research institutions by the quality of their U.S. patent portfolio, also finds that the number of U.S.-based organizations that placed within the top tier of IEEE's rankings-by-industry had fallen by 30 percent. Japan-based organizations, on the other hand, had a strong showing in the most recent report and now dominate the top spots in the automotive, electronics, chemical and semiconductor industry rankings.

The IEEE Spectrum Patent Power Scorecards ranks the world's most influential patenting organizations in 17 categories. For the 2009 edition, the group examined 1027 organizations, chosen for their patent portfolio and output. Instead of focusing on patent output quantity, the Patent Power report uses five metrics to evaluate the strength of their portfolios and their pipeline of new intellectual property. Metrics include:

• Number of U.S. patents obtained in 2008;
• Patent pipeline growth — calculated by dividing the number of U.S. patents in 2008 by the average number of annual patents since 2000;
• Pipeline impact — based on the number of 2008 patents by other organizations that cited patents obtained by the organization since 2000;
• Patent generality — based on the technological variety of patents that have cited the organization's patents since 2000, and;
• Patent originality — based on the technological variety of patents cited in the applications of the organization's 2008 patents.

These metrics are used to determine the top twenty organizations in 14 industries, including aerospace and defense, automotive and parts, biotechnology and pharmaceuticals, chemical, computer peripherals and storage, software, computer systems, electronics, medical equipment, scientific instruments, semiconductor equipment manufacturing, semiconductor manufacturing, telecommunications and telecom equipment. Rankings also are presented for government agencies, conglomerates and universities.

Of the 323 organizations that appear in the 2009 edition, 173 (54 percent) are U.S.-based. In 2007, the U.S. held 202 of 319 spots in the rankings (63 percent). The report attributes the decline to the global recession and declining support for research within companies. Several top-performing U.S. companies fell in the rankings including Xerox, which fell from third in Electronics to fifteenth, AOL, from fourth to fifteenth in Software, and Micron, from third to nineteenth in Semiconductor Manufacturing.

U.S. companies, however, still comprise a majority of the included organizations and dominate several of the categories. The Computer Software ranking, led by Microsoft, includes only one non-U.S. company, Germany's SAP AG in the number five spot. U.S.-based organizations also lead in medical equipment, telecommunications equipment, and aerospace and defense.

Only two non-U.S. institutions placed within the top twenty patenting universities. The UK's University of Oxford and South Korea's Pohang University of Science and Technology placed at 18th and 19th place, respectively. The University of Texas leads the list, followed by the University of California System, the University of Central Florida, Iowa State University and the University of Washington. The U.S. Navy leads the list of government agencies, followed by the Japan Science and Technology Agency, the Japanese Ministry of Economy, Trade and Industry, and France's National Center of Scientific Research.

Much of the ground lost by U.S. organizations was claimed by Japanese firms. In 2007, Japanese companies represent 14 percent of the organizations on the list. In 2009, that number has risen to 20 percent. Among organizations listed as conglomerates, three of the top four organizations are based in Japan, including Toshiba, Mitsubishi and Hitachi. Seven out of the top ten companies in the Electronics and in the Automotive and Parts categories are from Japan.

European organizations, which comprise most of the rest of the list, generally held steady.

Read the IEEE Patent Power report at: http://spectrum.ieee.org/at-work/innovation/patent-power-scorecards-japan-ascendant.