In my previous two articles I looked at entries to the Australian patent system in 2019, i.e. who filed new applications last year, and which patent attorney firms were the ‘winners’ and ‘losers’ in the filing stakes. These numbers tell us something about the current state of the market, and which companies are innovating – and seeking to protect their innovations – right now. Many people, however, are more interested in who has been obtaining granted patent rights, rather than who might obtain granted rights in a few years’ time. Indeed, the unveiling of the top recipients of US patents by IFI Claims Patent Services has become something of an annual event, generating considerable media interest, and the now-familiar sight of IBM sitting at the top of the list (for 27 consecutive years).
According to IFI Claims, there were 333,530 new US patents issued in 2019. Patently-O’s Dennis Crouch, on the other hand, puts the number at 354,507, while a search on the USPTO’s own database (using the query string ‘ISD/20190101->20191231 and APT/1’) returns a count of 354,446. Who to believe?! Whichever number is correct, 2019 established a new all-time high, at about 10% above the previous record set in 2017.
I do not expect there to be quite as much interest in the fact that 17,007 Australian standard patents were granted in 2019. This was not a new record. In fact, it was slightly lower than 2018, when 17,065 standard patents were granted, and well below the 2016 peak of 23,774. It should be kept in mind, however, that a surge in patent grants between 2014 and 2017 was driven largely by the behaviour of applicants bringing forward requests for examination prior to commencement of the Raising the Bar reforms on 15 April 2013, so the past couple of years should represent a more normal rate of patent issuance based on the underlying filings and examination requests.
Samsung topped the list of patent recipients in Australia with 203 patents, followed by Covidien (150), Apple (137), LG Electronics (132), and Huawei (119). Not one Australian patentee appeared in the top 50, although New Zealand’s Fisher & Paykel Healthcare just squeezed in at number 48, albeit with just 35 patents. By way of comparison, in 2019 Samsung obtained 6,469 US patents (ranked 2nd), Covidien 92 (68th), Apple 2,490 (7th), LG 2,805 (6th), and Huawei 2,418 (10th).
A notable absence from the top end of the rankings is Aristocrat which, despite filing a total of 722 standard patent applications between 2015 and 2018 received only 13 granted patents in 2019, in second place among Australian patentees behind national research organisation CSIRO with 25. In fact, the top 30 Australian patentees combined received only 162 patents in 2019, or 31 fewer than Samsung.
Overall, despite being consistently the second largest filing group (after US residents) Australians were only the fifth most numerous recipients of Australian patents in 2019, with just 908 patents, behind Germans (937), Chinese (1,035), Japanese (1,257), and US residents (8,139). So it seems that Australians are shunning our own patent system, which might not be such bad news if there were any sign that Australian applicants were securing patent protection in major export markets. This does not, however, appear to be the case. IFI Claims lists only the top nine countries in its public summary of US patent trends, from which Australia is absent, placing the country somewhere behind ninth-placed Canada, which received 4,651 US patents in 2019.
As for my previous two articles, the source of data is IP Australia’s AusPat system, combined with offline processing to match applicant details with the most recent (2019) IP Government Open Data (IPGOD) release. Since virtually all standard patents granted in 2019 resulted from applications filed in 2018 or earlier, details of patent recipients are almost invariably present, as applicants and/or assignees, in the IPGOD data set. As a result, the number of cases that could not be automatically matched was so small that I was able to complete the process manually.
Top 50 Patent Recipients
The table below lists the top 50 recipients of Australian standard patents in 2019.
|1||SAMSUNG ELECTRONICS LTD||KR||203|
|4||LG ELECTRONICS INC||KR||132|
|5||HUAWEI TECH LTD||CN||119|
|6||HALLIBURTON ENERGY SERVICES INC||US||116|
|9||MITSUBISHI ELECTRIC CORP||JP||91|
|10||MICROSOFT TECH LICENSING LLC||US||77|
|12||BECTON DICKINSON & CO||US||75|
|13||BIOSENSE WEBSTER ISRAEL LTD||IL||65|
|15||PHILIP MORRIS PRODUCTS SA||CH||63|
|18||DOW AGROSCIENCES LLC||US||60|
|19||3M INNOVATIVE PROPERTIES CO||US||60|
|20||SOCIETE DES PRODUITS NESTLE SA||CH||57|
|21||ELECTROLUX APPLIANCES AB||SE||56|
|23||TELEFONAKTIEBOLAGET LM ERICSSON PUBL||SE||54|
|24||UNITED STATES OF AMERICA||US||53|
|26||DOW GLOBAL TECH LLC||US||50|
|27||DYSON TECH LTD||GB||50|
|28||ECOLAB USA INC||US||48|
|29||BAKER HUGHES A GE LLC||US||47|
|30||CHINA UNIVERSITY OF MINING & TECHNOLOGY||CN||46|
|32||DAIKIN INDUSTRIES LTD||JP||45|
|34||EXXONMOBIL UPSTREAM RESEARCH CO||US||44|
|35||UNIVERSITY OF CALIFORNIA||US||44|
|36||WL GORE & ASSOCIATES INC||US||42|
|38||ROHM & HAAS CO||US||41|
|39||SHELL INTERNATIONALE RESEARCH MAATSCHAPPIJ BV||NL||41|
|41||ACCENTURE GLOBAL SOLUTIONS LTD||IE||39|
|42||ESSITY HYGIENE & HEALTH AB||SE||37|
|43||KIMBERLYCLARK WORLDWIDE INC||US||37|
|44||ILLINOIS TOOL WORKS INC||US||36|
|45||WEATHERFORD TECH HOLDINGS LLC||US||36|
|46||AB INITIO TECH LLC||US||35|
|47||F HOFFMANNLA ROCHE AG||CH||35|
|48||FISHER & PAYKEL HEALTHCARE LTD||NZ||35|
|49||AMAZON TECH INC||US||35|
Many of the names in this list also appear in the IFI Claims list of top US patent recipients. The most obvious exception is IBM, which consistently tops the US ranking, and last year received 9,262 new US patents. But despite its exceptional interest in obtaining US patents, over the past decade IBM has averaged fewer than 10 Australian patent filings each year. Australian patents are clearly not a priority for IBM!
Another notable absentee from the above list is Aristocrat, which is by far the most prolific Australian resident applicant, and consistently in the top 10 overall, averaging well over 100 applications per year for the past decade. And yet, of its applications filed between 2014 and 2016 (to pick a recent representative period for which most applications have completed processing), by early 2019 just 31 had resulted in granted patents, with 333 having lapsed, and seven remaining pending.
While it is not clear why Aristocrat files so many applications that it does not ultimately pursue, it is a company with a sophisticated IP management function, and it is therefore certain that there is a sound commercial logic behind its strategy. Perhaps it is too difficult to predict, at the time of invention, which innovations will be commercially important, and the company thus needs to keep its options open. Possibly, also, some Australian applications may be used to establish priority for further filings in other jurisdictions, but are not as relevant to the Australian market. Issues of subject matter eligibility for software-implemented inventions may also be a factor in some of Aristocrat’s decisions to abandon certain Australian applications.
Top Australian Recipients
The table below lists all Australian-resident entities to which three or more patents were granted in 2019 (it is just a coincidence that this also happens to be a ‘top 30’ list).
|1||COMMONWEALTH SCIENTIFIC & INDUSTRIAL RESEARCH ORGANISATION||25|
|2||ARISTOCRAT TECH AUSTRALIA PTY LTD||13|
|3||UNIVERSITY OF QUEENSLAND||12|
|4||TRANSTECH RESEARCH PTY LTD||6|
|5||UNIVERSITY OF MELBOURNE||6|
|6||BREVILLE PTY LTD||6|
|7||SCHNEIDER ELECTRIC AUSTRALIA PTY LTD||6|
|8||BLUESCOPE STEEL LTD||6|
|9||CSR BUILDING PRODUCTS LTD||5|
|10||HBG IP HOLDING PTY LTD||5|
|11||NEWSOUTH INNOVATIONS PTY LTD||5|
|12||TECHNOLOGICAL RESOURCES PTY LTD||5|
|13||UNITRACT SYRINGE PTY LTD||5|
|14||WEIR MINERALS AUSTRALIA LTD||5|
|15||TRIO HINGING AUSTRALIA PTY LTD||4|
|16||VECTUS BIOSYSTEMS LTD||4|
|17||CLINICAL GENOMICS PTY LTD||4|
|18||KING FURNITURE AUSTRALIA PTY LTD||4|
|19||NOWWWUS PTY LTD||3|
|20||CEC SYSTEMS PTY LTD||3|
|21||GLENCORE TECH PTY LTD||3|
|22||BASF AUSTRALIA LTD||3|
|23||NAUTICRAFT PTY LTD||3|
|24||ENGENEIC MOLECULAR DELIVERY PTY LTD||3|
|25||AIR DIFFUSION AGENCIES PTY LTD||3|
|26||BRIEN HOLDEN VISION INSTITUTE||3|
|27||GLOBALTECH PTY LTD||3|
|28||NATIONAL ICT AUSTRALIA LTD||3|
Australia’s leading research institution, the CSIRO, received just over half as many Australian patents as the two foreign public research organisations that made the overall top 50 – the University of California (44) and the China University of Mining and Technology (46). No other commercial entity in Australia received more than Aristocrat’s 13 patents.
The following table summarises the top 10 countries of origin for Australian patent recipients in 2019.
|1||United States of America||8139|
While Australian residents consistently comprise the second largest national group of applicants for Australian patents, after the US, they are only the fifth largest group of patent recipients. Considering that Australians filed an average of over 2,500 standard patent applications each year, for the six years between 2013 and 2018, it appears that less than 40% of all applications filed by Australian residents resulted in granted patent rights. This compares with just over 60% for US and German applicants, and over 70% for Japanese applicants. (The rapid growth in Chinese filings over the past few years, combined with the fact that many of these applications are more recent and remain pending, makes it difficult to estimate the underlying proportion of Chinese-originating applications that will end up being granted.)
Aristocrat is a small, but not negligible, contributor to the low rate of conversion of applications into granted patents by Australian residents, as is the fact that Australians are more likely than foreign residents to prepare and file their own patent applications without professional advice or assistance. Regardless of the reasons, most of the applications filed which do not proceed to grant represent costs (in money, time, and/or opportunity) without corresponding benefits. Even acknowledging that there may be particular circumstances in which the filing of an application in itself achieves some strategic or commercial advantage, the conversion rate for Australian applicants is alarmingly low compared to international peers.
Conclusion – More Bad News for Australia
According to Knoema’s World Data Atlas, Australia’s gross domestic product (GDP) in 2018 was US$1.42 trillion, compared to US GDP of US$20.6 trillion. On this measure, the US economy is just under 15 times the size of the Australian economy. In 2019 US residents received 165,556 ‘home country’ patents (source: IFI Claims 2019 Trends and Insights), while Australian residents received just 908 ‘home country’ patents, giving US residents 182 times as many ‘home country’ patents as Australians!
At the risk of sounding like a broken record, for the third article in a row I have to say that this is not good news for Australia. It implies that Australians are either underperforming on technological innovation, or lacking in knowledge and sophistication in relation to capturing, managing and protecting intellectual property. Or, most likely, both. And I also have to say again that unless there is a significant shift in government policy and messaging on innovation and IP, and in Australian business culture, I think that this is unlikely to change.