AmberBlog

On Jan 13 Florian Mueller, @FOSSpatents, wrote a blog post on the preliminary ITC ruling Motorola - Apple covering three patents, "including a strategically important one".

Having published an extensive report on the Smartphone Patent Wars in March 2012 (complimentary download available now) of course we were keen to understand how Network Patent Analysis (NPA™), which we had applied in the report, had ranked these patents by their strategic dominance or relative value. 

Florian Mueller writes "Whatever the reason for picking only three patents might have been, I believe two of those are less important than the third. The less important ones are U.S. Patent No. 5,379,430 on an "object-oriented system locator system" (yes, "system" appears twice in the title) and U.S. Patent No. 7,812,828 on an "ellipse fitting for multi-touch surfaces". The '828 patent is one of many patents Apple is asserting against Samsung in the United States, but it isn't nearly as essential to Apple's litigation strategy as another patent at issue in this preliminary ITC ruling and in use against Samsung in Apple's federal lawsuit in California: U.S. Patent No. 7,663,607 on a "multipoint touchscreen". The '607 patent is the broadest touchscreen-related hardware patent Apple has, and if the courts interpreted it as broadly as Apple would like them to, it would be extremely hard to work around."

So what did we find? The '607 "multi-touchscreen" patent referred to as a 'strategically important patent' was ranked as the single most dominant/ highest ranked patent in our analysis of the top  7,100 Smartphone patents, both within the technology cluster we identified as the "Touchscreen Cluster", as well as the overall Smartphone patent landscape. 

The '828 patent "Ellipse fitting for multi-touch surfaces", asserted by Motorola against Apple, and Apple against Samsung, ranked 9th in our report. (See the table to the left or report for further reference)

The only missing patent number of the three mentioned above was U.S. Patent No. 5,379,430 – which came in #361 in our ranking. This patent was regarded as ‘less important’ by FOSSpatents.

It is a great and encouraging result to have a strong alignment between our analysis and Florian’s analysis regarding the top ranked patent in the smartphone wars. 

Network Patent Analysis (NPA™) has been previously used to review an earlier hybrid car patent allegation against Toyota, where we were able to show how NPA™ patent analysis provided results consistent with litigation outcomes. The patent in question was ranked 2nd in our list of 60,000 hybrid car patents.

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Becoming a tennis professional and touring the world sounds like a great way to make a living, but like many ways to make money, the rewards are far from evenly distributed. For example, Tennis.com can tell you that the Serbian Novak Djokovic leads Spaniard Rafael Nadal as the leading money earner for the ATP tour. Novak has earned over $10 million in the last 12 months compared to the $6.4 million earned by Rafael. In contrast 99th ranked Frederico Gil of Portugal earned has earned $292,000 this season, a mere $2,000 ahead of Jeremy Chardy of France.

When we look at this distribution of earnings, Figure 1, we can see that they fit into a power law distribution (great blog post by John Hagel), which has a strong bias toward the top earners, but then shows a flattening off for the lower ranked players.

Power law distributions are also quite common in business, including for patent and portfolio values. For example, the Network Patent Analysis (NPA) being developed by Ambercite has the ability to assign rankings, and patent scores to individual patents, using such powerlaw algorithms. Different patent owners can be compared in terms of their patent portfolio score. In Figure 2, we compare the relative rankings in three different fields of patent ownership (smartphones, hybrid cars and Alzheimer treatments) to the power law curve we have just seen for men’s tennis players.

Figure 2 confirms the patent portfolio scores are spread just as unevenly in patent portfolio rankings as tennis professionals. But they in fact true power law curves?

The mathematicians among us will confirm that a true power law distribution will produce a straight line when plotted on a logarithmic curve. When Figure 2 is replotted in this way, we can see a ‘softening’ of the power law effect for all four distributions after about the 20th rank, Figure 3. This softening is much stronger though for tennis pros than for patent owners. We can speculate that the ATP (Association of Tennis Players) may try to manage the tour to ensure that some of the money is spread to lesser ranked players. Of course there is no such equivalent organisation for patent owners, which means it may harder to be a lowly ranked patent owner than a lowly ranked tennis player!

 

After all the recent patent interest in touch screen control methods, a new front is deverloping over touch free controls.

Both Apple and Microsoft have filed patents regarding controlling devices without physical contact, and others such as Qualcomm and Extreme Relatity 3D are also filing applications in the space.

While Apple envisage users being able to 'throw' content from one device to another, Microsoft describe sculpting 3D objects with hand gestures.

Touch-less control is not as new as it may sound, apart from a striking resemblance to a scene in the film Minority Report, Sony launched gesture recognition in their eye-toy based computer games in 1999, laser harps have been on the stage since 1981, and sci-fi favourite stalwart the Theremin was patented in 1928 (and who does not want to play with a Theremin?).

Microsoft have a good starting point in this area, with its already proven Xbox Kinetic accessory (in turn build on Rare(UK) and PrimesSense(Israel) technology).

Kenetic has proved a hit in the games space, and is impressively accurate, however its also expensive (relying on a infa-red laser depth sensor, in addition to camera), and bulky. Adapting it to be usable on a phone will be a challenge.

A very well written article in The Deal Magazine last week has highlighted the rapidly changing value of patents. David Marcus reminded us that the recent very high prices being paid for some patent are a new phenomenon, peaking at the $750,000 paid per patent for the recently sold Nortel portfolio.

Among other things, these sorts of prices have led to some to criticise the apparent divergence of patent owners into ‘good’ patent users and ‘bad’ non-practising but patent owning entities, but of course divisions such as this are never that black and white. For example the non-practising entity NTP who famously sued RIM in the earlier part of the last decade were asserting patents developed by the inventors when working at an earlier but failed telecommunications firm. This makes sense when you considering that developing patentable inventions is hard, and normally needs strong knowledge of the underlying technology in a field.

In the final paragraph of this article, Marcus notes: 

Focusing on the excesses in the patent system obscures how the separation of manufacturing from product development has inevitably made intellectual property a much more liquid asset -- and, just as inevitably, increased the importance of lawyers and valuation experts in a region that still doesn't know quite what to do with them

The ongoing value of patents is no doubt a topic that will lead to a lot more debate going forward. However one factor that may help this situation is improved transparency of the patent system and patent data. This is an area where the high quality insights available through the application of NPA may be able to make a real contribution.

A recent story which many of us might have seen, highlighted the importance of visualizations in jury trials. In many ways the value of visualizations are self-evident. Yet many of us in the patent space are slow to embrace the power of visualizations to make the complex stories we tell easier to explain.

An analogy we like to use in presentations is the hypothetical new visitor to New York. They do their homework - they determine that the subway is a good way to get around. But they have a choice on how they receive information about the subway system - either as a spreadsheet list of subway stations, or a subway map showing how the stations link together.

Of course this hypothetical visitor is almost always going to select a subway map over a list of subway stations. Yet the majority of patent search results are supplied as a list, or use simple visualizations that might show how a given patent is connected to their nearest neighbors, but no more than that.

The technology now exists to turn patent data into sophisticated visualizations that turn data into insights. Consider the smartphone patent 'battlefield map', which summarises 7100 smartphone patents that have either been litigated, or are closely linked to patents that have been litigated. This single map, produced using Network Patent Analysis (NPA™) provides a unique perspective on a complex legal space in one picture. Further examples of these types of visualizations can be found in the smartphone patent white paper.

Improved insight can help companies make better decisions, but this may only be one benefit. Just as NPA can help our clients understand how their patents fit into the technology environment they are competing in, NPA can also help patent owners market their IP to the world. In the first public NPA™ study we published, we highlighted the importance of hybrid car patents owned by Paice Corporation, an early mover in the hybrid car space. This was not because Paice was a client - to this date there has been no commercial relationship between Paice and either Griffith Hack or Ambercite. We were just reporting on what we found. However Paice were quick to pick up on our endorsement of their patents, and now use our analysis of their patents on their website (and with our permission).

The ability of NPA™ patent analysis to provide compelling marketing support for NPA™ owners is being picked up by our clients, and understandably. We all face the challenge on telling our story in a busy world. Any improved delivery of this story has the potential to make a positive impact on how the story is received by your various stakeholders, such as licensing targets, commercial partners, suppliers, clients, board of directors etc.

Want to know more? Check out our smartphone or hybrid car papers. However this is only part of what we can now do, and where we are going to take patent visualization in the future. Our aim is to change the way you think about patents and patent data, and we are already heading down this path.

If you think you are ready to move your IP marketing to the next level, contact us to arrange a presentation of what we can do, and our client case studies. You just might surprise yourself about what is now possible with the right tools.