The Artificial Intelligence (AI) sector is growing rapidly and is estimated that it will add £630bn to the UK economy alone by 2035.  Following the World Intellectual Property Organization (WIPO) report in early 2019, a new report from the UK Intellectual Property Office (UKIPO) now identifies the growth in terms of published AI patent applications.  This insight provides an overview of the UKIPO findings and considerations for technology businesses in this space.

What is AI?

AI is the use of technology to perform tasks that would usually require some intelligence, if done by humans.  

What is a patent?

A patent is a registered intellectual property right, which seeks to create a monopoly over the exploitation of an invention.   Patents historically can take years to process from application, publication to grant. The costs are also significant.  Patents are thereby a serious investment (and asset) for any applicant. 

The AI patent landscape

The WIPO and UKIPO reports show an exponential growth in the number of worldwide AI patent applications published by year. In 2017 almost 30,000 global AI-related patent applications were published worldwide compared to only 7,000 published 10 years earlier.  This growth is set to rise even further. 

The key markets for AI patent publications are the US and China, with China now leading in terms of annual applications published. The proportion of AI patent applications in the UK is growing at a similar rate to that of the US, with the UK ranked fourth in terms of applications published. 

The UKIPO report also shows the vast majority (88%) of patents first filed in the UK are also protected abroad, reflecting the global nature of the AI sector and the desire for UK-based applicants and inventors to seek protection and commercialise their inventions in international markets. Interestingly, compared with the UK, only 19% of Chinese published applications are accompanied by publications in other countries.   Perhaps this indicates that Chinese inventors are comfortable with the size of the Chinese markets, compared to the UK where inventors realise the need to target a larger market.   

Generally the trend is that the number of AI patent applications are growing in all countries and are fast overtaking the volume of other “non AI” patent applications. Many patent offices are introducing specialised advice for AI inventors and the IPO of Singapore has brought in measures  to reduce the timescales for processing patent applications from 2 years to 6 months. All of which will further fuel the international growth of AI applications. 

Who is applying for AI patents? 

Worldwide the leading patent applicants include IBM, Microsoft, Google, and other software companies along with many manufacturing and consumer electronics organisations such as Toshiba, Samsung, and Sony. Most of these businesses are based in the US, Korea, Japan and China. 

In the UK, the leading applicant is the BT Group. Its key areas of AI patenting involve transport, image processing and telecommunications.  Other significant leaders are DeepMind founded in 2010 and acquired by Google in 2014.  The company developed and patented AlphaGo, which became the first computer program to beat a professional Go player.  Most of DeepMind’s patents relate to the architecture details of neural networks and to aspects of training a neural network.  These inventions have a far-reaching impact into sectors well beyond gaming. 

Commercial impact – what does this mean for your business?

As the report shows, AI is on the increase and many international businesses are investing heavily in protecting their investment by filing for patents. These patents are likely to form the bedrock of technologies in the future in the fields of education, communication, computing, cloud storage, machine learning, professional services, automotive and more.   If your business could benefit from advancements due to AI it should monitor what service providers are adopting related inventions to stay ahead. 

It is important for businesses involved in AI development to implement a proactive strategy to protect and commercialise their IP rights and investment. If you are entering into agreements to develop AI related technology with third parties, you’ll need to carefully consider how the resulting IP rights are going to be registered, owned and licensed. A natural output of such a crowded IP space will also be increased AI patent litigation and cross licensing, which businesses must prepare for. 

How can we help you if you are in the AI sector?

We have a deep understanding of AI related technology and associated collaboration agreements, supply chain and licensing arrangements.  In conjunction with patent attorneys we support clients in the AI space to protect, defend and commercialise their technologies.   

We have a long history of working with clients in the semiconductor, emerging technologies, firmware and software sectors. We also work with software and data analysis providers. This means we understand the evolving products and services clients create and can advise on the best way to protect and get new products and services to market.

Please contact Rebecca Steer on rebecca.steer@steerandco.com.

Sources

You can read the UKIPO’s full report here.