15 Fascinating Facts About Mobile Patents

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Mobile patents occupy a turbulent world in which technology companies are constantly pitted against each other -- with very few winners. Over the past few years, investors have seen Apple (NASDAQ: AAPL  ) and Samsung duke it out in the courts, but the patent wars are open for any tech company to take part in.

To help investors understand how important the patent world is to tech companies, allow me to present some of the most fascinating facts about mobile technology patents over the past few years.

1. From 2002 to 2012, the amount of mobile patents issued in the U.S. skyrocketed by 591%. For comparison's sake, Europe issued just 76% more mobile patents during that time.

2. Apple has filed more than 416 mobile patents since launching the iPhone in 2007, has more than 1,300 mobile patents filed, and has entered into 479 lawsuits to defend those patents. And the company's legal team is showing no signs of slowing down.

3. Samsung received the most mobile patent grants in 2012 and holds the largest amount of global mobile patents. 

4. Between 2010 and 2012, litigation costs for defending smartphone patents were estimated at $20 billion -- not including tablet or other mobile patent litigation costs.

5. This year, mobile analyst Chetan Sharma expects mobile patents to account for 25% of all U.S. patents granted, up from 5% in 2001. In comparison, European mobile patents account for about 10% of all patents filed.

6. Apple holds the record for the largest verdict ever in a patent infringement case -- $1.05 billion. Samsung lost to Apple last August, and a jury decided the verdict. Despite the award, a U.S. judge has lowered the amount to $450 million, and a retrial is set for this November.

7. Key parts of the America Invents Act are expected to cut down on software patent trolls by instituting a "first to file" policy, as opposed to "first to invent," but it's hard to imagine that the new act will slow down the mobile patent wars. 

8. Patents don't just protect technology -- they can bring in big revenue. Qualcomm (NASDAQ: QCOM  ) makes 3% to 5% on every CDMA-enabled mobile device. Maybe that's why the company literally has a wall of patents at its headquarters.

9. Qualcomm and BlackBerry (NASDAQ: BBRY  ) have about 80% of their patents tied to mobile tech.

10. Google acquired more than 24,000 patents when it bought Motorola Mobility for $12.5 billion last year. The patents were bought to protect the Android ecosystem.

11. Aside from its mobile-phones business, Nokia (NYSE: NOK  ) has more than 10,000 wireless patents. Recently, BlackBerry agreed to pay an out-of-court settlement of $65 million to Nokia and undisclosed royalties to Nokia for use of its mobile WLAN patents. 

12. Nokia, Qualcomm, Samsung, and LG hold nearly half of all essential 4G LTE patents.

13. According to a Thomson Reuters report, Apple has patented a technology that allows batteries to run for days or weeks without being charged.

14. Since 1995, IBM (NYSE: IBM  ) has been granted the most patents compared with any other company competing in the mobile space, and the company is one of the top three mobile patent holders. Amazingly, only 16% of its patents have to do with mobile technology.

15. Having more mobile platform patents doesn't necessarily make you a mobile contender. Microsoft has the second-highest amount of mobile platform patents, behind Samsung, but its smartphone OS and tablets fall well below Apple and Google's mobile platform market share.

The thing about patents
Despite the back-and-forth fighting between tech companies, there's little evidence to show that vigorously engaging in mobile patent litigation is beneficial for companies. Sure, there are the occasional big payouts, but even large awards are sometimes reduced or later overturned. Although companies need to protect what they've created, investors should be wary of companies that focus too strongly on patent litigation and not enough on creating great products. In the end, great ideas continually implemented over the years -- not lawsuits -- are what will bring big gains.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged among the five kings of tech. Click here to keep reading.

Read/Post Comments (1) | Recommend This Article (5)

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On May 08, 2013, at 4:03 PM, hairyhoundstooth wrote:

    There is already a severe lack of credible information at investment outlets about patents (e.g., WSJ) and this article only makes the problem worse.

    This article concludes correctly -- "investors should be wary of companies that focus too strongly on patent litigation and not enough on creating great products." But almost every other statement in this article needs to be checked.

    Here is the worst example: [k]ey parts of the America Invents Act are expected to cut down on software patent trolls by instituting a "first to file" policy, as opposed to "first to invent," but it's hard to imagine that the new act will slow down the mobile patent wars." The reason why the America Invents Act (AIA) did not slow down mobile patents is because these companies are global companies that have been operating under first to file for a long time (the rest of the world has had first to file for a while now). The "first to file" parts of the AIA have little or nothing to do with "software patent trolls." The portion of the AIA that was actually aimed at trolls is the "anti-joinder" provision, which prohibited the trolls from suing numerous companies in the same suit and waiting for one of the companies to pay nuisance value to settle. Unfortunately this solution doesn't actually work very well in practice.

    FYI, I have been in the patent business and high tech industry for 15 years and I have represented some of the companies listed in this article.

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