Thoughts on A.I. and Blockchain Patents in the Knowledge Economy

In the mid-1990s, I noticed the profound transformation America was taking into the upper echelons of the Knowledge Economy, when viewed against the S & P 500 Market Index.  In particular, this “Switch” involved the transition from tangible assets forming the backbone of corporate value to one which involved Intellectual Property (IP) dominating a company’s market value.

John Rizvi - Miami Patent Attorney and Book Author

Prof.  John Rizvi, Esq.

 Florida Patent Attorney 

Nearly three decades later it’s estimated that 80% of the market value of all publicly traded companies is dominated by Patents and IP.    Consider the implications of this statistic for a moment: Unless you have a patent or some proprietary technology, you probably have little chance of commercial success in the United States today.

Patent and IP Growth in American Stock Market

Feeding into the IP frenzy is the increasing role technology is playing in disrupting key sectors like healthcare, finance and retail.   Many would argue, for instance,  that the Open Source Revolution (OSS), including Linux, has been a key driver in this revolution, although it can generally be difficult to capture the value of IP in the digital domain. The incoming influx of Artificial Intelligence (AI), Machine Learning & Blockchain (and cryptoocurrency) technologies amplifies the need for a special set of skills and parameters to accurately get software patented with the USPTO.  

I’ve said it before and I’ll say it again:

Software patents require careful, precise claims and descriptions, way above what one typically finds in general “widgets”. Inventors should also bear in mind that there are relatively few attorneys in the United States that specialize in patent law. Even fewer, I might add, who have at least two decades of experience to steer your idea to success with a commercial patent. 

The landmark Alice case in 2014 is also worth noting, since the Supreme court had to determine whether computerized processes were concrete software programs or merely abstract ideas that should not be protected under patent law.

In the end, our highest body determined that abstract ideas were insufficient for transforming an idea into a patentable product.  

Just a few years later we are in a much more complex arena where Artificial Intelligence encompassed by Google’s Deep Mind, IBM’s Watson and Baidu’s internal AI program, are offering new avenues for IP protection and debate.   Many of of us are stunned by the advances in recursive learning - the ability for a machine to teach itself a new skill - that’s arguably the most promising and alluring aspect of AI.

In parallel, new blockchain technologies are now popping up in test platforms everywhere. While Finance (i.e. FinTech) seems to be dealing with the first disruptive wave of new Digital Ledger Technologies (DLT) (including IBM’s announcement that it’s trialing the Stellar Lumen blockchain for new cross-border payments in South Pacific) you will also see it affects felt in healthcare.

One possible end goal of the blockchain revolution is to produce a common ledger of health information that doctors and providers can access no matter what electronic medical system is used.   This should, experts say, result in higher security and privacy and less admin time for doctors.  Ultimately this means more time to spent with the patient while also offering better sharing of research results to facilitate new drug and treatment therapies for disease.

In one example, IBM is involved in using Watson (Its AI Supercomputer) to help define and secure, efficient and scalable exchange of health data using blockchain technology. IBM will be working with the FDA to explore the exchange of owner mediated data from several sources, such as Electronic Medical Records, clinical trials, genomic data, and health data from mobile devices, wearables and the “Internet of Things.”

Power of Patents - AI and the Blockchain

I mentioned IBM twice above because as large corporations go they are prolific in developing and protecting their IP capital.  In fact, they just broke the record for a whopping 9,043 patents giving it the remarkable mantle of having secured over 100,000 patents during its storied mainframe (and cloud) lifetime.  I recently wrote a short piece about one particular female inventor inside IBM who has gone on to secure over 225 patents and shows no signs of stopping! 

As a side note, IBM is ranked more or less around the #32 mark in the S & P index showing that while patents are indeed important you still need to worry about manufacture, distribution, marketing, strategic advantage, and of course, competition.

As the AI revolution sweeps us all up also consider that 1,900 patents secured by Big Blue were in the cloud arena.  At least 1,400 of these related specifically to AI, including those that can mirror human speech and machine learning in self-driving cars.

It has also established a number of additional blockchain patents in both the private and public capacity, revealing the remarkable confluence of new technologies inside one of the world’s largest companies.

The Digital Ledger Blockchains, are increasingly being referred to as the TRUST protocols since they promise to overcome the security (and privacy) limitations of today’s centralized databases and weak IT systems by offering a peer-to-peer transactional system.   In a sense, it’s another layer being built upon the Internet which is helping to drive further innovation both within IBM but also among smaller entrepreneurs and business leaders who are racing to usurp the status quo.

Every week I am approached by first-time inventors to secure patent protection in the areas of cryptocurrencies (built upon blockchains), AI, Big Data, and sensor-devices, often referred to as the Internet of Things (IoT), that themselves are connected to the cloud for big data crunching and AI amplification.

In particular, I find specific industry variations for the above centered around 3D printing, MRI technology and optical communications.   I am continually amazed by the innovative ideas my clients bring to me and I hope they in turn are impressed by my abilities to secure a bulletproof patent on their behalf.  

Many express concern regarding the rise of patent trolls, often referred to as patent sharks, who are filing an unprecedented number of expensive lawsuits.  There may be as much as 5,000 patent troll lawsuits occurring annually in the U.S., which can cost inventors and startups millions if not properly protected.  The rise of the Knowledge Economy has made software particularly vulnerable since software patents are increasing by dramatic amounts each year.  This makes them a target and will only be exacerbated as the we move into the Age of AI which will further accelerate technological advances.  

I am lucky to have an outstanding team of researchers, engineers and legal assistants working under me, who I direct 100%  towards analyzing the competitive landscape and determining the novelty and uniqueness of an inventor’s technology-related idea.   It’s this due diligence and painstaking research (and cross-checking) that yields the results my clients crave, especially in the software and technology arena.   Our team has to religiously and manically pour over data to ensure we pick the right submission path for both provisional and non-provisional software patents.  It's also worth reminding readers that anytime an inventor enters into communication with us we provide a confidentiality agreement.  This ensures their idea remains safe and secure, as we formulate a strategy to protect their idea with the USPTO. 

On a lighter note, I often bring up the famous patent submission by Amazon, for their human speech AI device, Alexa.

It was brilliantly presented by their team to the USPTO.  

As The MIT Technology Review eloquently put it:

“The engineers needed just 11 words and a simple diagram to describe how it would work. A male user in a quiet room says: “Please play ‘Let It Be,’ by the Beatles.” A small tabletop machine replies: “No problem, John,” and begins playing the requested song.”

As I write this, I would have to say that the blockchain technologies are starting to dominate patent submissions.   In fact, the number of blockchain patents filed and published with the USPTO, are probably double that of the year before.  By the way, this relates to both private and public blockchains.   

Again, it is worthing referring back to the S & P 500 and determining who is at the top of the leaderboard with regards blockchain patents. You might think that IBM, mentioned earlier, would be the victor considering it has over 100,000 patents.

In fact, the answer may surprise you: Bank of America. This household name has acquired roughly 48 related blockchain patents, although jury is out as to whether they will practically implement any of the new commercial technologies based on the "Consensus" Protocol.

Many people believe the blockchain will one day be used for sophisticated smart contracts, a scenario which may allow autonomous peer-to-peer software to replace the middleman in industries such as real estate to decipher ownership.   It may even one day find a use inside the patent system in which there has always been controversy as to how software is patented.  

These thoughts or were cannily  telegraphed  several years ago by the Director of USPTO, David Kappos, who stated:  

At the heart of a well-functioning innovation (software) environment is accurate information about who owns what assets, so that license rights can be confirmed or sought, and unproductive effort simply avoided. By analogy, if you want to build a house on a piece of land, you check property records to determine who owns the land, so you know who to contact about purchasing or leasing the land. Of course, the same goes, in theory, for patent properties. But in our current environment, it can be a real challenge for those who find themselves facing a possible infringement suit to determine the owner of the patent they may be infringing.

Many early adopters of the blockchain methodology would perhaps read the statement above and see the value of using a blockchain approach - The Trust Protocol - to mediate ownership, identity and record-keeping, for both patents and real estate, just two examples of many industries that could be impacted by this new technology.

Whatever happens over the next five years, we will probably see the greatest rate of technological change ever witnessed in our society.  This will likewise offer massive opportunities to far-sighted inventors who wish to tackle big problems in healthcare, finance and cloud computing.   

Patent attorney’s will play a key role helping startups protect their idea from global insurgents and copycats (especially in China).    While many software inventors are quite rightly worried by follow-on litigation, this, as Kappos says, “is a direct reflection of how our patent system wires us for innovation. It's both natural and reasonable that in a fast-growing, competitive market, innovators would seek to protect their breakthroughs using our patent system”.

In my opinion, It is indeed still the strongest IP system in the world and allows our inventors to compete globally once their intellectual property is locked up by the USPTO. 

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