An integrated indicator system for patent portfolios: evidence from the telecommunication manufacturing industry

ABSTRACT

Against the background of ‘patent portfolio races’ in industries such as telecommunications, this paper proposes a set of patent portfolio indicators to measure patents’ scale and diversity. This indicator system is used in a time series to analyse the patenting activity and technology strategy of the world’s top 20 firms in the telecommunication manufacturing industry, based on a large data set from United States Patent and Trade Office. In combination with composite and relative measures, we identify the firms’ comparative positions in patenting activity. The paper adds to the ongoing discussion about, and enriches the theory of, patent portfolios.

KEYWORDS:

• Patent indicator system
• patent portfolio
• scale
• diversity
• telecommunication industry

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes on contributors

Lei Guo is currently a Ph.D. candidate in the School of Management at Xi’an Jiaotong University, China. Mr Guo was a visiting scholar at the UQ Business School, University of Queensland, during 2013–2014. His research areas include patent portfolio analysis, technology strategy and catch-up strategies for latecomers in the telecommunication industry in China.

Dr Marina Yue Zhang is a senior lecturer in the School of Business at the University of New South Wales (UNSW Canberra). Her research fields include emerging technology, high-tech entrepreneurship and catch-up strategies for latecomers in emerging countries.

Professor Mark Dodgson is Director of the Technology and Innovation Management Centre in the UQ Business School, University of Queensland. Professor Dodgson is a visiting professor at the Imperial College Business School. His research interests are in the areas of corporate strategies and government policies for technology and innovation.

Professor Hong Cai is a professor of management in the School of Management at Xi’an Jiaotong University, China. Professor Cai has been a visiting fellow in the Research Centre for Advanced Science and Technology, University of Tokyo. Her research fields cover the economics of technology and knowledge, as well as policy issues of science and technology.

Notes

1. Since January 2009, a subclass – H04 W (denoting to wireless communication networks) – was added to the telecommunication technology domain in the World Intellectual Property Organization’s IPC definitions. Given the critical role that wireless technologies play in today’s telecommunication industry, we included H04 W in our analysis.

2. We traced patents filed by our sample firms on H04 W which was reclassified into the TF of telecommunications in 2009. The number of such patents was insignificant before 2002, thus we started our calculation of H04 W from 2002.

3. The patent counts for G08C (about 1.52%, 0.63%, 0.71%, 2.56% and 3.40% for the five periods, respectively) and H04Q (about 0.50% of all yielded patents for the period 2007–2011) were so insignificant that we decided to exclude them from our dataset. Because of the low patent counts of sample firms in G08C and H04 K, we covered six IPCs in our study.

4. We also tracked the name changes of firms resulting from mergers and acquisitions, joint ventures and other industry consolidation activities. For example, Alcatel and Lucent merged in December 2006 and we treated the new firm under the name Alcatel-Lucent.

5. We acknowledge the importance of standard-essential patents in a firm’s patent portfolio (Rysman and Simcoe 2008; Hussinger and Schwiebacher 2015; Pohlmann, Neuhäusler, and Blind 2016). Using the Disclosed Standard Essential Patent database (Bekkers and Martinelli 2012; Kang and Bekkers 2015), we identified about 5500 standard-essential patents filed in the USPTO, and then eliminated those not included in our own database (i.e. standard-essential patents that are not in the technology fields or within our timeframe or filed by the subject firms in our study). After applying this filter, the relevant standard-essential patents accounted for less than 0.4% of the total patents in our study and were widely distributed among different firms, across different technology fields and spread across the entire 25-year period of our research timeframe. The impact of including the standard-essential patents in our subject firms’ patent portfolios was insignificant and unstable, at an aggregate level.

6. RTA has been widely used to measure the relative technological strengths of different TFs for each organisation/country (Schmoch and Schnöring 1994; Mahmood and Singh 2003; Wang, Chiu, and Chen 2009; and Hu 2012, among others).

7. We took the natural logarithm of both variables in the patent matrixes. The reference lines represent the mean values of each dimension.

Additional information

Funding

This paper is financially supported by two grants from The National Natural Science Foundation of China [grant number NSFC 71272137], [grant number NSFC 71302147].