24 Apr

The Microsoft patent portfolio: 40,000+ active patents; China biggest jurisdiction after US; 15% of total acquired

Microsoft celebrated its 40th birthday this month. In the four decades that have passed since its relatively humble beginnings as a start-up, the US company has grown to become one of the world’s largest patent holders. According to the US Patent Elite 100 list featured in the most recent issue of IAM, Microsoft owns the sixth largest portfolio of active US patent assets, including 28,130 grants and 9,035 applications.

Addressing delegates at IPBC China 2015 in Beijing earlier this week, Microsoft chief patent counsel Micky Minhas also shed some light on the company’s international IP holdings. Outside of the United States, Microsoft had 18,029 granted patents and 21,662 pending applications – as well as 12,717 issued and 1,564 pending industrial designs – as of 23rd March this year. 

China is the key IP jurisdiction for Microsoft beyond its home turf; it has received approximately 3,000 invention patents and has submitted about 3,500 applications on top of that in the country. Not far behind comes the European Patent Office, where the top issuers of rights to Microsoft are, in order, the United Kingdom, Germany and France. Japan, South Korea and India round out the top five locations of Microsoft’s ex-US portfolio.

Minhas also revealed the breakdown of Microsoft’s portfolio in terms of internally generated patents and those which have come from third parties, either in standalone rights transfers or as part of whole company acquisitions. Around 85% of Microsoft’s patents are of ‘organic’ origin, while the company acquired the remaining 15%.

The table below outlines the 10 companies which have transferred over 100 active patent assets to Microsoft, in order of the size of their contribution to its portfolio. Nokia is far and away the leading source, with Skype and Nortel a distant second and third. Beyond these top 10 assignors, the remaining 14% of Microsoft's acquired patents came as part of smaller transactions.

Assignor entityCountry of assignor

Contribution to Microsoft's total acquired patents

NokiaFinland69%Microsoft completed its acquisition of Nokia's device and services business in April 2014 for €5.44 billion (US$7.3 billion). Microsoft announced that it received 8,500 design patents as part of the deal, while it additionally paid $2 billion to license 30,000 patents remaining in Nokia's ownership. The two companies have previously worked together on IP monetisation, so it is quite possible that there have been other occassions when patents have changed hands between them.
SkypeEstonia6%Microsoft purchased Skype for $8.5 billion in May 2011. 
NortelCanada3%Rockstar BidCo - a consortium formed of Apple, EMC, Ericsson, Microsoft, Research In Motion (now BlackBerry) and Sony - obtained the patent portfolio of bankrupt Nortel at auction in mid-2011 with a winning bid of $4.5 billion. Around 4,000 assets were assigned to newly created NPE Rockstar, while the remaining 2,000 were distributed among individual consortium members.
AntenovaUnited Kingdom1%University of Sheffield spin-out Antenova was a developer of high performance antennae and radio frequency antenna modules for wireless communication. It was bought by Microsoft in 2013.
AOLUnited States1%Microsoft paid AOL $1.056 billion for 925 patents and applications in April 2012. Later that month it sold 650 of these on to Facebook for $550 million.
CanestaUnited States1%Canesta was a Silicon Valley-based maker of computer chips relating to gesture control technology that was purchased by Microsoft in October 2010.
DangerUnited States1%Microsoft acquired mobile phone maker Danger in February 2008.
iD8 Group R2 StudiosUnited States1%Microsoft announced its acquisition of this 'smart home' start-up in January 2013. A year previously, R2 Studios itself had acquired over two dozen patents from Florida's OpenPeak.
Perceptive PixelUnited States1%Touch screen maker Perceptive Pixel was acquired by Microsoft in mid-2012.
SGIUnited States1%Struggling (now defunct) SGI transferred a number of its patents covering 3D computer graphics technology to Microsoft in late 2001 and early 2002. Allied Security Trust bought 22 of these patents from Microsoft in 2009; these were eventually transferred to Open Invention Network.

Jack Ellis