Patents fuel the intellectual property wars

Before 2006, only one company – IBM – managed to gain more than 2000 U.S. patents in a single year. But in 2006, five companies broke that barrier: IBM with 3651 patents, Samsung with 2453, Canon with 2378, Matsushita at 2273, and Hewlett-Packard at 2113.

That’s a huge amount of patent activity. In fact, according to IFI Patent Intelligence, my source for all these numbers, there were 173,772 U.S. patents issued in all of 2006, a record amount that was 20.8 percent higher than in 2005.

To quote from IFI’s analysis,

“2006 panned out as a banner year in terms of the number of individual patents granted and leads us to believe that the USPTO is making headway in addressing its backlog of patent applications,” said Darlene Slaughter, general manager of IFI Patent Intelligence.

“Although the number of patents being granted is not the only gauge of technological advancement, the relative increase in number of patents being generated indicates a growing emphasis on the value of intellectual property.”

The USPTO is the U.S. Patent and Trademark Office.

Some other big patent winners in 2006: Intel, at 1962, Microsoft, at 1463, and Sun Microsystems, at 776. You can see the same list I’m looking at the IFI site.

When you factor in the power of patent cross-licensing, patents are an incredibly potent weapon. Patents not only help a company gain market share, but also help them successfully defend that market share against competitors – particularly upstarts. Big competitors share their patents. Smaller competitors don’t have the IP to play that game, so they either have to pay through the nose, or stay out of the game. Novell, in its lopsided IP licensing deal with Microsoft, may be a casualty of the IP wars: it was simply out-gunned.