Will Patents Hinder IoT Openness?

by Steve Hoffenberg | 03/12/2015

Coined by Kevin Ashton in 1999, the term “Internet of Things” (IoT) has only recently become a widespread concept. Use of the term began its slow emergence from the tech world in 2003-2004 when popular publications like The Guardian and Scientific American wrote articles on IoT. However, based on Google Trends, interest by tech companies and the public began rising around 2009 with a dramatic increase in 2013, a year filled with smart home appliances and tech giants’ connected device innovations.

To delve more into the increasing interest in the Internet of Things, VDC conducted an analysis of U.S. patent applications and patent awards specifically mentioning “Internet of Things” or “IoT.” In the chart below, the green line represents the number of IoT-specific U.S. patent applications, and the purple line represents the number of IoT-specific patents awarded. (Note that the average award of a U.S. patent takes more than two years from its date of application.)

Not only is “Internet of Things” being mentioned in more patent applications, but more applications mentioning IoT are also being awarded patents. A peak number of patents mentioning IoT were awarded in the most recent quarter, 2014Q4, and an increase to this peak is nearly certain in 2015.

Undoubtedly there are many more patent applications and awards related to IoT that don’t specifically mention the term in their filing documents. However, the small but growing use of the term in patents, as shown in the chart, is an indicator that we are just at the leading edge of what is likely to become a large wave of IoT-oriented patents.

While earlier IoT technologies and communication methods were often openly published, many IoT methods are now being retained as intellectual property through patents. Examples include, “Internet of Things Lawful Interception” (application #20130057388), “Methods, devices and systems for establishing end-to-end secure connections and for securely communicating data packets” (application #20140143855), and “Mobile communications devices and transmission methods for transmitting machine type communication data thereof “(patent #8,681,701).

Of course there is a fine balance between the stimulation of innovation via openness vs. the economic incentive of owning intellectual property, but increased patenting of IoT communications techniques could adversely impact the future structure of the IoT, making it less open. On the other hand, the increasing number of IoT patents might merely reflect the spread of the term’s marketing buzz. In either case, navigating a plethora of IoT patents is likely to increase development burden and possibly hinder product introductions for nascent IoT companies.

View the 2017 IoT & Embedded Technology Research Outline to learn more.