We're No. 12! We're No. 12! That is not the chant that a proud American might have been cheering at the Olympic Village in Pyeongchang. President Trump isn’t likely to break out this little tidbit of information in his Twitter feed, even though he could justifiably blame it on previous administrations. But, according to a Chamber of Commerce report, that is where the U.S. is now ranked when it comes to protecting intellectual property.
China is outdoing the US in some kinds of AI-related intellectual property, according to a report published in mid-February by US business research firm CB Insights. The number of patents with the words “artificial intelligence” and “deep learning” published in China has grown faster than those published in the US, particularly in 2017, the firm found.
The Chinese patent system has come a long way since the first intellectual property laws were passed in China in 1985. Many would argue that China’s budding patent system has actually surpassed America’s older and more established patent system (which has been around since 1790 when then-President George Washington signed the first U.S. patent) in speed and efficiency and in providing strong patent protection to innovative companies and emerging startups as well as to individual inventors.
At issue is a new procedure, established by the 2011 America Invents Act (AIA). It provides an mechanism for the Patent Office to double check its work and weed out its mistakes, revoking patents that never should never have been granted. A few critics claim that, because of this procedure, innovation in the United States is on the wane. The data shows just the opposite.
This year the United States edged out the United Kingdom by a mere .01 points on the Chamber scale. The U.S. position was helped by improved scores relating to copyrights and trademarks, but was dragged down as the U.S. patent ranking decreased for the sixth consecutive year as the result of a patent climate that the Chamber characterizes as causing “considerable uncertainty for innovators.”
Although there are some positive outcomes illustrating the power of the patent system, there have also been some significant missteps in the other direction. By moving one step forward, but two steps back, the United States is losing ground as an innovative leader. A quick look at one recent case may help illustrate these ideas:
With a GDP of nearly $19 trillion and a population in excess of 323 million, the United States is the largest consumer market in the world. As such, global corporations make doing business in the U.S. a priority. To take full advantage of this market, American and foreign companies must protect their proprietary innovations and inventions through patent grants.
Chinese companies have increased the number of U.S. patents they’ve received by tenfold in less than 10 years, another sign that the world’s second-largest economy is succeeding in its strategy to transform from Silicon Valley’s factory to a powerhouse of research. Chinese inventors received 11,241 U.S. patents last year, a 28 percent increase over the same period in 2016...
The American patent system is the lifeblood of the U.S. innovation economy. Businesses that secure patents innovate at higher rates than those that lack intellectual property; startups and new businesses that hold patents attract capital more easily than those that do not; and startups that obtain a patent are more likely to go public.
A relatively simple way to boost the economy and make America even greater is to fix a patent system gone awry. In recent years, major changes to intellectual property policy by Congress, the courts and the executive branch have thrown the system out of whack, deterring inventors from the kind of innovation that creates jobs and growth.