25 Mar

Analysis of the top 10 patent filers

Samsung, IBM and Canon are numbers one, two and three for 2020 – as they have been since we started this list nearly four years ago.

With 7,986 additional patents for Samsung and 6,184 for IBM, the top two entities increased their totals by 9% and 11% respectively. Samsung added to its applications by 3.7%, whereas IBM’s dropped by 14%. This is the second year in a row that Big Blue has seen a significant fall in applications (it recorded a 26% decrease in 2019).

With a 6% increase in patents and a 4% decrease in applications, Canon maintains its hold on third position. Compared to the dramatic drops that it experienced in both patents and applications from 2018 to 2019, 2020 was relatively flat year on year.

LG Electronics has continued its climb, overtaking Microsoft and moving into fourth position. LG not only widened the application gap with Microsoft, but also surpassed the number of applications held by Canon. Time will tell whether it will be in a position to leapfrog over Canon next year.

Applications at Microsoft, for its part, continued to fall, down another 11% year on year, following a 40% decline in applications the year before.

Intel, Alphabet and Sony all maintained their positions at sixth, seventh and eighth in the list, with nominal increases in their US patent holdings (3.6%, 6.5% and 5.5% respectively).

To round out the top 10, Qualcomm skipped over Panasonic to nab the ninth spot – fewer than 300 patents separating the two, as was the case last year. Qualcomm continues innovating organically at a steady rate, while Panasonic, with the spin-out of its security systems business into the new Panasonic i-PRO Sensing Solutions Co, continues to shed assets.

Big movers

There are three main drivers for those that have moved position:

  • acquisition activity;
  • collateralisation; and
  • strategic portfolio management.

On the up

Saudi Arabian Oil (also known as Saudi Aramco) was the biggest mover this year, rising 160 positions (the most in either direction). In June 2020 Saudi Aramco acquired Saudi Basic Industries Corporation (or SABIC), a Saudi Arabian chemical manufacturing company. This nearly tripled its US patents and doubled the number of applications (4,236 grants and 1,635 applications).

Similarly, Abbvie’s acquisition of pharmaceutical company Allergan pushed it up 132 places, more than doubling its US grants and applications.

BorgWarner realised big patent and application gains when it acquired Delphi Technologies and moved up 104 positions as a result.

Morgan Stanley (up 84 positions), MUFG Union Bank (up 83) and Capital One (up 79) show that financial entities continue to accumulate intellectual property at a tremendous rate, and indicate that many entities in other industries continue to leverage their assets as collateral.

On the way down

Despite no significant portfolio transactions or collateralised assets, AGC (formerly Asahi Glass Company, down 103) holds 31% fewer US grants this year and 12% more applications. In what appears to be a strategic investment in newer technologies, AGC is dispatching dated assets and focusing more on new filings.

Table 1. Top movers and fallers

Entity namePosition 2020Changes in position2020 grant2020 applicationsApplications published in 2020IndustryCountryRegion
Saudi Arabian Oil1171604,2361,635770EnergySAMiddle East
Abbvie1561323,175715235Medical/pharmaUSNorth America
Borgwarner1631042,901467149AutomotiveUSNorth America
Morgan Stanley186842,440435100Financial institutionUSNorth America
Mufg Union Bank174822,68714317Financial institutionUSNorth America
Capital One241791,849896576Financial institutionUSNorth America
Salesforce200592,186969478Computing and softwareUSNorth America
Tencent198542,2191,040360Computing and softwareCNAsia
Conversant365-391,1025121OtherCANorth America
Dominion Harbor231-431,9221085OtherUSNorth America
Crestline Direct Finance282-491,5532140Financial institutionUSNorth America
E Ink353-561,17011160ElectronicsTWAsia
Jefferies Financial268-611,65413338Financial institutionUSNorth America
Stats Chippac295-631,4272814SemiconductorsSGAsia
Fila Holdings270-731,6467730Consumer goodsKRAsia
Ingersoll Rand391-1021,00622381IndustrialIEEurope

Similarly, there were no significant transactions involving an outflow of assets for Stats Chippac (down 63) or, to a lesser extent, E Ink (down 56). In fact, throughout June 2020, Stats Chippac recovered the portfolios of some 1,800-plus assets that it had previously leveraged with Citigroup back in 2015. Despite this, it held 20% fewer grants year on year. For its part, E Ink held 11% fewer grants than last year.

Unlike AGC, the application holdings for Stats Chippac and E Ink were down significantly (40% and 34% respectively) and may reflect hyper-competitive semiconductor and electronics spaces. When combined with global economic and pandemic-related pressures, Stats Chippac and E Ink may be exploring more aggressive cost containment measures.

Although the positions of both Ingersoll Rand (down 102) and Novartis (down 99) dropped significantly, their story is different.

In the first quarter of 2020, Gardner-Denver completed the acquisition of Ingersoll Rand’s industrial business division and assumed the Ingersoll Rand corporate identity. The balance of the former Ingersoll Rand business was renamed Trane Technologies Inc and focuses on building management systems. The reorganisation resulted in the newly reformed Ingersoll Rand holding 27% fewer grants and 44% fewer applications. For its part, the new Trane Technologies Inc never made it onto the list.

Novartis also reorganised and spun out its eyecare business in the form of Alcon. As a result, Novartis held 33% fewer grants and 15% fewer applications this year, dropping into the bottom third of the list. Alcon holds a handful more patents than its former parent and sits a few spots ahead at 260th. The combined assets of Alcon and Novartis was 36% greater for 2020 than 2019, implying that innovation is strong and that both are positioned well for 2021.


Other notable movers

Jefferies Group (down 61)

In 2020 the number of patents Jefferies held as collateral dropped by 15%, yet at the same time, its applications grew by 13%. This may reflect the cycle rather than any shift in strategy, whereby transactions are currently flowing out from Jefferies. The expectation is that the outflux will reverse, with a quick peek at preliminary January 2021 data suggesting that this is already the case.

Crestline Direct Finance (down 49)

This is another financial entity engaged in IP transactions. In this case, Crestline assigned back part of a large tranche of assets that Empire Technology had leveraged in late 2018.

Conversant (down 39) and Dominion Harbor (down 43)

These NPEs manage large portfolios – the former in wireless and semiconductors, and the latter in imaging, as well as other sectors. Both have struck deals with operating companies to build patent arsenals that extend into the thousands. They acquired assets in 2020 but not in sufficient numbers to offset grants that expired due to fees, age or strategic culling.

In the course of the year Conversant concluded a significant licensing deal with RPX for its wireless portfolio, while CEO Boris Teksler indicated that the company was now looking to focus its monetisation efforts on the chip sector.

In Dominion’s case, CEO David Pridham told IAM late last year that it had spent 2020 mining opportunities in its existing asset base and looking to raise new capital.