< For the 23rd year in a row, IBM was among top 50 patent assignee in the U.S.
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For the 23rd year in a row, IBM was among top 50 patent assignee in the U.S.

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January 14, 2016

It's been noted this morning that, for a 23rd year in a row, IBM has been ranked number one in the top fifty U.S. patent assignees, with a total of 7,355 grants.

Samsung Electronics came in the second spot with 5,072 patent grants, while Canon clocked third with 4,134 grants, according to a detailed analysis of U.S. Patent and Trademark Office data.

Overall, patents are part of a full-time job at IBM. The company expects its technology and process-engineering staff to create patentable ideas on a daily basis.

You simply don't become an IBM distinguished engineer without having first filed a few patents that are noteworthy.

But what's more interesting is that Satya Nadella's Microsoft has tumbled so far down the top 50. Microsoft ranked number 10 with 1,956 patents filed in 2015, down from number 5 the year before with 2,829 patents.

What makes that fall more remarkable is that Microsoft was number 3 in 2009, growing 43 percent over the year before to hit 2,903.

It was Bill Gates who in 2003 put Microsoft on a deliberate policy of racking up patent filings to make more money for his software company.

In 2004, a year after he'd initiated the program, Gates told Wall Street analysts he was stepping up the pace to increase licensing revenues for Microsoft.

"We are at an early stage of that now, but it's something that we are pretty excited about," Gates was reported to have said at that time.

Gates had been responding to IBM, a company that – back in the early 2000s – Microsoft wanted to be more like.

He saw what BigBlue was doing with patents and liked it so much he decided to emulate the IT giant.

Horacio Gutiérrez, Microsoft's corporate vice president, said while he was chief intellectual property officer that he said Microsoft's patents were not a profit center but, rather: "A currency that you use to trade to another company."

It's Gutiérrez's quote that appeared on press releases in 2010 announcing that Microsoft had agreed to some patent cross-licensing deal with a Linux/Android device maker.

Even IBM admitted that the value of patents comes not from the creation of technology but, rather, from the leverage they provide against somebody else.

Does the fact that Microsoft is sliding down the numbers demonstrate the death not just of Gates' policy for industrial-scale patent production, but also a corporate softening under Nadella?

Despite the dwindling filings, Microsoft has continued to press for more enforcement, switching its initial attention ten years ago from makers of Linux to manufacturers of devices running Google's Chrome or Android. Star Micronics was the latest in November 2015.

It would seem that what Microsoft is enforcing is an increasingly dated portfolio rather than an ever-expanding body of work.

If things continue in that manner, the implication is that the legal team's scope for operation will become increasingly limited, as will Microsoft's ability to cash in on the concept.

But there is a good reason for the drop at Microsoft, according to IFI Claims Patent Services, who crunched the USPTO data.

"Rather than keeping all corporate patents under a single registration, some companies are choosing to spread their portfolios across multiple entities," said Larry Cady, IFI senior analyst.

"This is why we are seeing such a dramatic movement this year with Microsoft and Panasonic, which all started assigning some patents to newly formed holding companies," he said.

Just so that you know, Panasonic was number 18, down from 10. What Microsoft is doing is changing to more covert means to file its ideas.

In the near future, if you encounter a new Microsoft patent, there's a good chance you won't know it's registered to Microsoft.

Also, there's a good chance that somebody other than Microsoft's legal team will be doing the chasing.

Whether or not Microsoft switched to stealthier means, what is true is the fact that IBM is no longer the benchmark Gates once said it was.

As in other areas of computing, it's the new entrants in the fields of mobile and cloud that are beginning to out-gun Microsoft, at least according to those recent numbers.

For its part, Qualcomm was up three places to number four, Google up three places to number five, sitting in that slot held by Microsoft 12 months ago.

Amazon, according to IFI Patent Services, made some "impressive gains." Amazon Technologies landed at 26, up from 50 in 2015.

Time will tell whether all those technology companies follow Microsoft in asserting their claims.

Source: The U.S. Patent and Trademark Office.

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