After almost three decades at the top of the list for most approved patents in the US, IBM dropped to No. 2 in 2022 behind Samsung Electronics Co., reflecting a shift in Big Blue's strategic direction the past few years.
IBM's patent count dropped 44% to 4,743 in 2022. It trailed Samsung's 8,513 patents, which was neither an increase nor a decrease from 2021. The technologies that saw the largest drop among IBM's patents were semiconductors and memory. There were also significant reductions across most of the company's technology offerings, according to Harrity & Harrity LLP's Patent 300 list.
The data collected for the Patent 300 list comes from the U.S. Patent and Trademark Office.
Factors in IBM's patent filings
"IBM has changed their strategy with respect to patents," said Rocky Berndsen, head of analytics at Harrity & Harrity. "They're no longer looking to be No. 1 [in patents]. They are focusing less on quantity and more on quality. This is reflected in the huge transformation their business is going through."
IBM's patent portfolio business has been profitable over the years, averaging a little more than $1 billion a year in revenue since mid-1996, according to IBM's financial filings.
That transformation kicked into high gear with the arrival of Arvind Krisha, IBM's CEO in April 2020. Krishna has spearheaded IBM's concerted effort to steadily move away from the company's reliance on server hardware and other legacy infrastructure and moving toward a software and services focus -- specifically AI and a variety of cloud computing technologies.
Krishna also served as the guiding force behind the $34 billion acquisition of Red Hat, which has significantly improved IBM's competitive positioning in the hybrid cloud market. The acquisition of Red Hat's hybrid cloud technologies has somewhat reduced IBM's in-house hybrid cloud development, which in turn has reduced the need to file patents in that area.
Another factor contributing to fewer patents being approved in 2022 was IBM's decision to spin off one of its technical services group, which became Kyndryl Holdings Inc. Kyndryl made the Patent 300 list for 2022, coming in at No. 218.
Yet another reason for the drop in IBM patent filings is the move away from pure research and more toward applied research. Krishna made it clear soon after becoming CEO that he wanted IBM Research's effort to be more purposeful in turning out technologies that could be more easily monetized.
"There was a shift in the way they invested in research," said Frank Dzubeck, president of Communications Network Architects Inc. "They moved away from researchers making breakthroughs in solving mathematical equations and more toward the specific application of research, like with quantum computers."
Samsung's shift; the rest of the patent leaders
Samsung rose to the top position last year based on its strength across a broad spectrum of business and consumer products and technologies. The company, which came in at No. 2 in 2021, has successfully registered more than 8,000 new patents a year since 2017, according to Harrity & Harrity.
Rocky BerndsenHead of analytics, Harrity & Harrity
The company has most notably been awarded patents on visual display systems and voice communications, but it also did well in 2022 in a variety of semiconductor technologies.
"Samsung covers so many areas in consumer electronics, but they also patented technologies involving semiconductors for mobile devices, including PCs and phones along with consumer products like televisions," Berndsen said.
Another notable high-tech company placing high on the 2022 list is Dell Technologies, which placed 13th with 2,445 patents approved -- a 19% jump over 2021. "The high ranking in 2022 extends the momentum the company established over the past seven years," Berndsen said.
"Since 2016, Dell has double the number of U.S. patents they have obtained," he said. "They have made a lot of acquisitions over that time such, as EMC, CA and VMware. Although there has been a lot of divestiture too, having spun CA and VMware back out."
Still, Dell compensated, racking up an increasing number of patents in several computer-related technologies, including networking, software, visual displays and cryptographic security.
"They covered a broad range of technology areas in 2022. But the top ones have to do with a number of different memory technologies and data bases," Berndsen said.
Intel dropped from No. 6 in 2021 to 12th in 2022 with 2,501 patents -- a drop of 9%. The marks the fourth consecutive drop in patents for Intel since 2019. according to Harrity & Harrity. That's compared with rival and sometimes partner Taiwan Semiconductor Manufacturing Co., which rose to No. 6 with 3038 patents from No. 7, with 2,807 in 2021.
Somewhat surprisingly, both Microsoft and Apple dropped down the list in 2022. Apple finished 14th with 2,313 patents, which is down 11% from 2021, and Microsoft placed 18th with 1,888 patents granted, which is down 25% from the previous year.
In the case of Apple and Microsoft, external factors neither company had any control over could be the reason for the falloff in patent filings. One factor could well be the COVID-19 pandemic; the other could be the deteriorating economic climate during that same period, forcing cutbacks in research and development.
"The lower number of filings in 2022 is likely due to the ramifications of what happened in 2020 and 2021," Berndsen said. "In some companies, they made strategic decisions having to do with budget considerations and were more selective in what they decided to file [patents] on."
Given the lag time between when a patent is filed and when it is formally issued, Berndsen said he suspects more patents on AI and other emerging technologies will be seen in the 2023 and 2024 filings.
"It will be a year and a half to two years before anyone looks at a patent filed today," Berndsen said. "Patents are always a look back on what was a hot technology a couple of years ago."
Overall, there were 323,018 patents filed in 2022, which was down 1% from 2021, according to Harrity & Harrity.
As Editor at Large with TechTarget Editorial's News Group, Ed Scannell is responsible for writing and reporting breaking news, news analysis and features focused on technology issues and trends affecting corporate IT professionals.