Published on:

Data about how hard it may be to pin down the value of in-house patent counsel

An in-depth analysis of one thousand global companies that have significant R&D spending, published in Strat. + Bus., Winter 2006, Issue 45, found “no statistical relationship between financial performance and either patent counts or patent quality” (at 45). The authors conclude that “more R&D spending can lead to more innovation activity, but it doesn’t necessarily create more valuable innovations.”

I find it hard to square such a finding with the importance so many companies place on patents and their in-house IP capabilities (See for example my posts of Oct. 10, 2006 about Dial Corp.; Oct. 29, 2006 on Qualcomm; and Dec. 4, 2006 regarding “strategic thinking” at Palm.). Yet it seems that research liked the cited study discounts much of the value from patents (See my posts of Jan. 3, 2006 and its data that questions the contribution of in-house patent lawyers.). The synthesis of the two points comes down to the phenomenon that a very few patents are blockbusters.