The rise of the patent brigade

Consider this. In 2011, the total number of patent applications for in India was estimated to be 37,000, according to controller general of patents, designs and trade marks, ministry of commerce and industry data. In 2012, it had hovered around 34,000.

Technology companies – both international and Indian – are leading the charge of the patent brigade. Take the case of GE. In 2011, 400 patent applications were filed by GE globally that have contributions from GE India. “We have 4,500 scientists and engineers to think creatively and contribute towards solving problems in infrastructure, healthcare, services and work with teams outside India,” Gopcihand Katragadda, Managing Director, GE India Technology Centre, Bangalore told Business Line . Further, areas of specialisations include energy, aviation, transportation, water, healthcare along with technology specialisations in areas including materials, imaging, nanotechnology, sensing, transmission and distribution, renewable energy, energy storage and others. While GE does not give out country specific details, the push for patents is happening at a considerable pace as the company is betting on markets like India to drive future growth.

The world’s largest technology company, IBM set a record in 2011 as its inventors recorded 6,180 patents in areas like commerce, shopping, medicine, transportation amongst others. While IBM does not give out patents generated out of geographies, it said that IBM inventors who reside outside the US contributed to more than 26 per cent of the company's 2011 patents.

Another technology major, Philips, filed 210 patents out of India primarily in healthcare. “Inventions have been made in the areas of clinical decision support, image processing, signal processing, thermoregulation methods for incubators, pregnancy monitoring are being worked from the Bangalore centre,” said Viswanathan Seshan, Head, Intellectual Property & Standards, Philips India.

Networking giant Cisco’s engineers managed to get about 68 patents from India. similarly, Chinese competitor Huawei’s Indian R&D centre was involved in development and delivery of high-end telecom software platforms, components, applications in the areas of next generation networks, data communication, unified communications, network management, optical network, mobile handset software amongst other areas.

Kulbhushan Misri, Head, Analog, IP, Sensors, Freescale Semiconductor India said that the company has filed over 200 patents in sectors like automotive, networking, industrial and general consumer. Apart from driving global projects the India centre was instrumental in developing solutions specifically for the Indian market such as developing new chips that incorporate vehicle safety, infotainment, and telematics. Telematics is a technology that uses IT and communications in an integrated manner in cars and other vehicles.

Beyond the big boys

It is not only the big technology companies who are calling the shots in using India as a patent base. Smaller companies both Indian and international like Infosys, Wipro, SlingMedia, Ittiam Systems, Harman India and others are leveraging their ecosystem. Infosys, for example increased its patent filings by 50 per cent in FY12 fiscal over previous fiscal. During the 2012 fiscal, the company in a filing to the Securities and Exchange Commission (SEC) said that it filed 143 unique patent applications in the United States Patent and Trademark Office (USPTO) and the Indian Patent Office. Competitors, TCS filed 43 patents in 2011, Wipro filed 8 patents. Others like HCL Tech and Cognizant still have some catching up when it comes to patents, according to a recent Barclays Research.

One of the main reasons that patent filings are on the rise can be attributed to the increasing recognition of IP which can guarantee a better revenue stream for companies instead of services, which is coming under increasing pressure. “We are focused on the automotive segment where technology is a key differentiator when it comes to cars and this is where Indian tech companies can set themselves apart,” said Ravi Pandit, Chairman and Group CEO, KPIT Cummins.

Privately held Ittiam Solutions in the FY12 fiscal crossed $20 million in revenues with royalty income contributed to more than 35 per cent of its revenues. “So far we have been granted 30 patents and another 30 patent filings are under review,” said Srini Rajam, Chairman and Chief Executive Officer of Ittiam Systems. The company comes up with new IP in areas like automotive infotainment, communication and broadcast technologies.

Raja Krishnamurthy R&D Head, 3M India and Sri Lanka said that the India centre received 14 patents in 2011 in areas like adhesives, polymer processing, acoustics, surface modification, specialty materials, nanotechnology. 3M sells products in healthcare, industrial and transportation, display and graphics (like hoardings) in India.

Another telecom focused company Mavenir Systems filed 48 patents in 2011 out of India. Pardeep Kohli, president and CEO, Mavenir Systems said: “In areas of mobile voice/ messaging delivered to IP devices and VoIP / IP messaging services to old mobile phones were some of the patent areas we worked on.” These patents are being used by the likes of AT&T, Vodafone, Telefonica Moviles, T-Mobile, Telstra and Bharti. But statistics can be misleading and in some cases they raise concerned questions.

Compare the number of patents filed in India to a state like California, which in 2011 filed 30,750 patents and one begins to comprehend the concerns- not just amongst the overall patent scenario in India but also amongst companies who want to tap into the Indian talent pool but realise that awareness of patents are in its nascence. Especially, in a country that is on a journey to transform from an agrarian to knowledge led economy.

Another piece of statistic that puts the cat amongst the pigeons has to do with the contribution of patents to the GDP of a country. In a research study released late last year, management and advisory firm Zinnov estimated that Indian R&D spend stands at approximately 1 per cent of its trillion dollar GDP, which is slated to double in the next few years. “There is a need to further strengthen the IP ecosystem to boost increased R&D in the country,” according to Pari Natarajan, Chief Executive Officer, Zinnov.

Long walk

India faces problems across the board - from the lack of awareness to a system that quickly grants (or rejects) patents. The controller general of patents, designs and trade mark which comes under the ministry of commerce and industry is severely short-staffed and industry watchers say that it is not up to date with the technology changes, which is a key requisite to grant or reject patents. Calls and emails sent by eWorld were unanswered. The industry faces currently, like lack of education and awareness about IP, its ownership and its value, coupled with, difficult access to capital to invest in IP creation, say industry watchers. There is also lack of comprehensive IP commercialisation, frameworks, inadequate enforcement of Intellectual Property Rights (IPRs) and lack of adequate supportive legal and policy frameworks are also some strong ones that are restricting the growth of IP creation in India, opines Natarajan. The lack of IP infrastructure in the form of IP agents, law schools, and special IP courts need to be addressed, added Suvojoy Sengupta, Partner, Booz and Company.

India needs to pull up its socks sooner rather than later. China, in 2009, filed for 3,00,000 patents and plans to file 1 million patents by 2015. While India is the second largest patent filer in the world, as per World Intellectual Property Organisation (WIPO), companies feel that there is an urgent need to strengthen industry academia partnerships and incentives in the form of quicker application processes is the need of the hour. As Raman Subramian, VP, Quest Engineering and Bejoy George, CEO of Axis Aerospace and Technologies put it: “For companies like us, need for patent oriented laws that encourage innovation and closer engagement with the academia is of paramount importance.”

In the final analysis, the country loses out on revenues that can be ploughed back into the economic development. As per a recent report from the US Commerce Department, IP intensive industry contributes $5 trillion and 40 million jobs to the US economy. Interpreted another way, it is 5 times the size of the current Indian economy and 40 times more jobs.

> venkatesh.ganesh@thehindu.co.in

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