Patexia Insight 149: Innovation Trends in the Last Decade (a Comparative Analysis)

Last April, we released our fourth annual Patent Prosecution Intelligence Report. This report not only evaluates and ranks all participating entities by activity and performance but also provides various patent statistics by analyzing the data at a high level. In previous weeks, we covered some of the most active and best-performing attorneys, law firms, and companies in Patexia 145, Patexia 142, and Patexia 140, respectively. Today we will look at the top trends based on the IPC codes and perform a comparative analysis with ten years ago.

An internationally unified patent classification like the IPC system has several benefits. Not only does it make the prior art search more manageable, but it can also be used to understand what type of patent application is being filed or granted. This can be used as a proxy for innovation trends as it shows the near future emerging technologies and products. For example, while 5G was made available to the public in 2019, the research and patent race between companies began years earlier, with several companies self-declaring extensive 5G patent portfolios at the moment it was introduced. Using our Patent Analyzer, we extracted data from all patents granted by the USPTO in 2021 as well as those granted ten years earlier in 2011. A total of 248,870 patents were issued in 2011, while in 2021, this number had grown to 364,713. This represents a 46.5% increase since a decade ago.

To better understand the patent landscape, we grouped the patents by their IPC subclasses for 2021 and 2011. Then we compared the data for the top 10 most popular IPC codes as shown in the following chart. Since the number of patents has increased by almost 50% over the last decade, we showed the data in percentage for a more relevant comparison.

As seen above, three of the top ten codes belong to H04, covering electrical communication systems, and one to H01, which covers basic electric elements. Four IPC codes belong to the G06 class related to computing, calculating, and counting, while the remaining two belong to the A61 class related to inventions in life science. Eight out of ten IPC codes have grown during this decade compared to the 2011 data. That means they now take a bigger part of the total. H01L and A61K weight appears to have shrunk very slightly, meaning that they take almost the same or less percentage of total patents as in 2011. We should note that in absolute terms,  even H01L and A61K have grown almost 50% together with the rest of the patents (in 2021, we had almost 50% more patents compared to 2011).

Key findings:

• H04L subclass covers the Transmission of Digital Information, including data transmission and telegraphic communication. Patents issued here have jumped from 4.3% to 10% in the last decade, making this IPC code the second most important in 2021. With mobile phones and GSM networks being introduced in 1991 and the internet made available to the public that year, digital information and its transmission have received a lot of attention in the past decades. A further boost was given during the past decade and is expected to continue to do so in the foreseeable future based on the current patenting trend and the growth of information technology, blockchain, and other data transmission methods. The past ten years have seen some important landmarks, such as the popularization of smartphones and the expansion of social media, which increased the number of users transmitting and the size of digital data online, as well as the introduction and increased use of cloud storage and cloud computing. New technologies require a lot of R&D capital, and a practical way to protect the return on investment is by patenting. The top five companies with H04L patents issued in the computer and smartphone industry are the leaders: IBM, Huawei, Qualcomm, Samsung, and Microsoft.
• H04W covering patents in wireless communication has grown several times from 1.4% to 6%, moving to the 4th place. Wireless communication has existed since Marconi in 1895, and products such as TV/Radio and later mobile phones saw significant enhancements in the last decade. 4G and 5G were researched and introduced within the previous ten years. Wireless device sales have tripled during this period from 472 million in 2011 to more than 1.5 billion units sold yearly. Part of the revenue is invested back into R&D to advance wireless technology. Innovations here are carrying on with next-generation 6G wireless tech research. The University of Texas has launched a 6G research center supported by major wireless industry players such as AT&T, Samsung, and Qualcomm. Interestingly, the top companies obtaining patents in the H04W IPC code are also the leading smartphone manufacturers, Huawei, LG, Samsung, Apple, and Ericsson.
• G06T filings related to Image Data Processing now comprise 3.9%, ten times the volume of 2011. Most of the patents in this area go to tech leaders such as Samsung, Canon, Sony, IBM, and Intel. Image sensors can be seen in everyday life, from our phones to cars and almost every corner of the city. Systems for sensors and facial recognition-related patents are major advancements, while before 2010, the applications of these concepts were limited. Image processing also receives a lot of attention due to its wide applications. For example, agriculture optimization is made possible by photography analysis giving data about the quality of yield or water stress. Other applications include traffic management by high-resolution image analysis and disaster management like floods, earthquakes, or fires. Machine learning and image data processing also advanced the medical field.
• G06Q, G06K, and G06F are three of the remaining G06 class codes and have increased in the last decade. They are related to Data Processing Systems, Graphical Data Reading, and Digital Data Processing, respectively. Covering devices with computing functions included, it is no surprise that these sectors receive significant R&D capital as well as patents. With the increased number of mobile devices and digital cameras, big data has made it possible to recieve, store and analyze location-based and behavioral data. It has numerous applications starting from optimized advertisement targeting to health-related such as the number of daily footsteps. Additionally, data transmission, data handling, and input/output devices are updated continuously. Cryptocurrencies and blockchain technology were also two major advancements during the 2010s that have contributed to numerous patents and have not reached their full potential yet.
• H01L patents related to Semiconductor Devices, Electric Solid State Devices, which belong to the hardware innovations, seem to have shrunk by 0.3% as a percentage of the total. Although the total number of patents for this code has increased by more than 40%. This is one of the most important areas of innovation with a whole new level of attention as the US government is allocating huge sums of taxpayers’ money to expand and reinvent this sector, considering the geopolitical challenges in Asia and the recent conflicts between China and Taiwan that may cause problems for the semiconductor sector. TSMC the largest semiconductor foundry is located in Taiwan.
• A61B patents that cover instruments for diagnostic and surgical procedures have increased. Imaging technologies such as molecular imaging are emerging technologies that have seen advancements during the past decade. A61K, related to medical preparations, mainly occupied by pharmaceutical patents, has shrunk only by 0.2%, while the total count of patents has increased by more than 40%. The pharmaceutical industry has increased the patent filings almost in proportion to the increase in the overall patent filing. Pharma is an R&D-intensive sector, and patents are the major incentive that drives pharmaceutical companies to invest billions each year in new drug development. Biologics and the race for the coronavirus vaccine were major events of the past decade.

In conclusion, IPC codes are a useful tool that can be used to analyze patenting trends. However, since patents come in the process of research and development before any product or service is even launched, the findings of the analysis could be used to understand future innovation trends better. Advancements require years of research, and patents are obtained before the technology is available to the public.