Predicting the future using patents

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It’s all too easy to see patents as a barrier to innovation – telling us all the things we cannot do. Yet in fact they can hold the key to success. Patterns within global patents are full of rich insight which can lead to new market opportunities and compelling product ideas. They may even lead to those elusive ‘first-to-market’ innovations for your business.

Patent databases capture the whole of human invention – especially innovations with value, as patenting is expensive! Interpreted in the correct way, they can work like a crystal ball into the future, and really drive innovation. It is possible to predict the technologies of the future – and competitor products – using patent landscapes, if you use the appropriate skill and subject matter expertise. Such predictions can inform competitive commercial strategies for the future in the right context.

Some of the macrotrends you may see from patent landscapes are truly fascinating. Today, for example, China is known as a technology superpower globally – but not in the late 1990s. Its potential emergence could potentially have been predicted way back in 2002 from the patent landscape, when patent output in terms of patent families from Chinese assignees first started to surpass that for US assignees – at a time when we were all busy processing the aftermath of the dotcom bubble. The landscape now suggests that China will become the world’s global leader in technology in the not-too-distant future. Assignees in China now file more than 11 times the number of patent families filed in the US – and, incredibly, five times the number filed by the US and Japan combined!

The trends affecting the patent landscape in Japan are potentially even more intriguing. Japan’s relative decline in its economic position as a technology powerhouse could also have been predicted in 2002, when its annual output in patent families reduced for the first time. The patent output in 2016 was roughly the same as it was in 2000 – completely in sync with a GDP that did not really increase from $4.9 trillion over the same period. Within that time, the focus of the landscape has significantly changed. Major declines have been in information storage through mechanical means and basic electronic circuitry – which is not a major surprise as Japan was the world leader in videotape and consumer electronics in the 1980s/1990s.

The fastest growing areas for patent activity in Japan include games and medical or veterinary science, as Japan is searching for new markets to move away from its successful markets of the past. The focus in games is pinball machines, amusements and video games. And in medical and veterinary science it has been instruments – such as endoscopes for examining internal cavities – and drugs, including cancer therapeutics and skin treatments.

These trends really do resonate with what we know from other sources. We know that the Japanese population in general is ageing, with deaths now outnumbering births – causing demand for treatments in areas such as cancer and dermatology. We also know that Japanese electronics companies are looking to leverage their technology assets away from the consumer, into markets such as medical imaging and diagnostics where they could provide significant innovation. And Japanese companies are still known to develop uniquely creative console and arcade games – and this is a market in which they will continue to hold a strong global presence. Arcades are often the test bed for new home console games – an area in which Japan is still dominant in global markets.

Further careful intellectual property (IP) landscaping analysis could reveal the underlying user needs in these growing market areas, competitive demographics and even white spaces for innovators to create compelling new offerings with disruptive market potential. The data points from patent analysis are not useful on their own – needing support from other sources and an understanding of the overall context. Insightful analysis requires tools for numerical analysis, IP-savvy minds, the ability to connect the dots in a market, market knowledge, user insights and technical understanding. As part of an holistic mix of data, it could lead you to new markets and disruptive products for the future…

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Pari Datta

Senior Innovation Consultant