Ant Group continues to innovate in the blockchain space, toping 2020 for related patent filings

Positive news for the Ant Group as the international academic journal Intellectual Asset Management (IAM), which tracks the dynamics of patent industry, published its latest research results looking at the top global leaders in blockchain innovation, ranked by the quantity as well as quality of patents filed.

Ant Group ranks top, based on the number of global blockchain patent families filed, followed by Ping An and Tencent. It also leads the list based on the qualitative measures of these patents, ahead of IBM and Tencent.

The blockchain patent landscape has come to be dominated by Chinese companies in recent years. Ant Group is top of the table, after  explosive increases in 2018 and 2019, while Ping An Group has enjoyed a more recent surge to become the second biggest filer.

These numbers come courtesy of Clarivate’s Derwent Innovation. According to data from the Derwent World Patents Index (DWPI), in 2020 there were 9,415 patent families filed in the blockchain  field, a drop from 12,300 in 2018 and 11,299 in 2019. Chinese companies on Derwent’s top 10 list combined to file 3,066 of these applications,  nearly one-third of the global total.

Ant Group has 2,298 patent families according to Derwent, and they have been one of the earliest inventors and patent filers in the blockchain  space. Ant Group has also rolled out blockchain applications into its e-commerce business, including tools that utilise smart contracts for cross-border  trade and a suite of services branded AntChain. Ant Group has been preparing for an IPO listing by consolidating IP rights relevant to its business from throughout  the Alibaba Group and its subsidiaries and affiliates.

The Ant Group portfolio also rates highest across several qualitative measures giving it the top overall score in the data  provider’s “average strength index”. The metrics that make up the Derwent Strength Index span geographical coverage (filing breadth),  downstream impact (citations), success rate at patent offices (grant ratio), the breadth of the technology covered by the invention and the  remaining life of the patent. Ant Group and IBM boast the top overall quality scores.

Last year saw a big shift in the filing landscape, with an explosion of new applications from Shenzhen-based Ping An Group. The company filed  1,215 blockchain patent family applications in 2020, compared with just 291 the year prior. The recency of Ping An’s filing surge means that the  vast majority of its rights have yet to be granted.

Ping An Group, which has 1,749 blockchain patent families in total, is a financial and insurance conglomerate in China, proving a wide range of  services including banking, asset management and trusts. In 2008 the company set-up a tech subsidiary, Ping An Technology, to focus on  biometrics, AI, blockchain, cloud computing and other fields.

Tencent rounds out a distinctive “big three” in terms of blockchain portfolio size. The Chinese messaging and payments giant scores the third on a series of metrics, including applications, grants, and average breadth and strength of patents.The only non-Chinese company among the top ten is IBM. The American tech giant is ranked fourth. But IBM’s blockchain patent quality is strong – it has the highest citation rate of any company, scores the second strongest overall behind Ant Group, and owns some of the earliest rights in the  space.

A range of Chinese entities populate the remainder of the top ten, including large state-owned enterprises like China Unicom and the State Grid  Corporation, search giant Baidu, and a few companies little known outside of China (Beijing Aimoruice Technology, Hangzhou Fuzamei Tech and  Inspur Droso). The raw numbers suggest Chinese industry – from established tech giants to start-ups  and SMEs – are concentrating on blockchain R&D and patenting activity in a way that overseas entities are not.

However, there are a number of  reasons for caution when it comes to the quality and value of China’s emerging patent lead.First, patent applications can be filed easily, especially if subsidies and other incentives are available, but only a fraction of filings might  eventually be granted. Second, most Chinese companies in the list score around 1 for average filing breadth, an indicator of how many jurisdictions a patent family  covers. The more countries in which a patent has been filed, the wider legal protection and international potential the right has. Ant Group  scores the highest with above two in this category, followed by IBM (1.22), Tencent (1.17) and Baidu (1.10). That suggests their portfolios may be highly concentrated on China.

Blockchain technologies are being applied in diverse spaces from payments to logistics to telecoms, and patent ownership is fragmented among  different-sized firms from various industries. It might take some time for the market to work out what are the core and essential rights in area,  and the value of various large portfolios.While statistics suggest China is taking the lead in patenting activity quantitatively, the question of portfolio quality and value needs further  analysis. If blockchain remains an area in which a large proportion the patent activity is done by Chinese companies, it will be interesting to see  how the market’s licensing and litigation dynamics play out and whether it has much impact overseas.

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