In my last post, Data Mining: 4 Ways to Use Patent Analysis for Any Size Business, I described some benefits of patent analytics using 2-D data, but now let’s look at the data-rich information you can derive by adding dimensions. (Don’t forget, patent analytics isn’t intended to be used in isolation from other resources.)
Map opportunities and threats in your market space
This example uses a bubble chart to plot the level of activity among companies trying to obtain patents for certain technologies. Using this format, we can start visualizing a map of opportunities and threats.
This is a good time to mention that Patent Analytics reminds us to consider the three legs of the stool when making business decisions, since patent applications covering a specific technology are filed to capture a future market. The above data is helpful, but it is only part of the information we need to analyze as we consider our future activities or entry into this area.
Technology scouting
Did you read the post Has the Technology Life Cycle thrown you a curve? that included this graphic? [1]
If so, you understood that this graphic relates to the money a company invests in a new technology, from ideation to when sales end.
If we translate the technology life cycle curve into one appropriate for intellectual property, we could say that increasing numbers of patent applications represent increasing recognition of opportunities in a particular technology and its future markets. As the number of applications flattens and starts to decrease, we could say the opportunities are diminishing. The shape best representing this description would be more like the technology life cycle curve [2] shown here:
In the next chart, the overall height of the individual lines represents the number of IP publications being filed in a particular technology space.
For example, the blue color on the bottom represents one specific technology.
This technology was generally stable from the earliest time (on the left) until it declined to a new level around 2008.
Excluding any other information, we can say that the blue technology may have reached a level of technical maturity, as fewer applicants are finding opportunities for improvement and/or anticipating a future return on their investment. The red and green technologies may have a similar situation.
The technology that may not be following a downward level of attention is represented in purple. At best, it may be stable since the activity level is similar to that seven to eight years ago.
Knowing these levels of activity is also important for those considering a merger, acquisition, or investment since patents, depending upon the context, can help identify future industry growth or decline. If nothing else, they help provide some clues about the value of intellectual property in this area.
Pick Apart Your Competition
Finally, let’s use patent analytics to learn more about specific companies which may be our competitors. By looking at these activity numbers, we can infer competitors’ investment levels, research focus, and the future markets they’re targeting. Since Samsung had the largest share of data, we’ll pick on them for our next example. Sorry Samsung!
If we have a predisposition toward specific technologies, we can jump straight into analyzing activity levels in those areas, as shown in the following graph.
We can surmise that Samsung invested in, researched, and saw more opportunities in charge-trapping memories from 2006 to 2007, but this has gradually waned as attention has shifted to magnetic memories.
Let’s do a quick wrap-up of the value of Patent Analytics:
- Helps identify new competitors, technology maturity, risks, and opportunities.
- Brings together the relationship between technology, IP, and markets.
- Ensures that our view of the future is verifiable with data.
- It provides tremendous value by bringing real data points into focus quickly and at a reasonable cost, since it eliminates or minimizes the tedious process of reading many patents or patent applications.
- It helps identify trends quickly.
- It can be used across many business segments (not just high-tech areas such as memory, as above). Examples include the music industry, grocery chains, and so many more industries.
- It should not be used to the exclusion of other data.
But be cautious about your expectations, because Patent Analytics can raise more questions than answers (often a good thing).
And, finally, I will say it again. Patent Analytics is a tremendous resource but should not be used to the exclusion of other data.
Do you have questions about this information, or about what other models you can create with Patent Analytics? Contact me or submit a comment.
Graphics credits:
[1] Krantzmh (Wikimedia)
[2] Craig Chelius (Wikimedia)
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