Tracing Innovation

TIA Consulting, Inc. & 1790 Analytics LLC 1 Tracing Innovation Vienna, Austria December 11, 2007 Rosalie T. Ruegg Managing Director TIA Consulting, Inc. ruegg@ec.rr.com TIA Consulting, Inc. & 1790 Analytics, LLC Patrick Thomas Principal 1790 Analytics LLC pthomas@1790analytics.com Overview • What is “tracing innovation”? • Why trace innovation? • How to trace innovation? • An example from the U.S. Department of Energy • Additional examples using patent citation analysis • Wrap-up: summary/questions/discussion TIA Consulting, Inc. & 1790 Analytics LLC 3 What is “tracing innovation”? • Identifying science-technology linkages • Identifying innovations that generate further innovative activity • Mapping knowledge flows in national innovation systems TIA Consulting, Inc. & 1790 Analytics LLC 4 Identifying science-technology linkages • Forward tracing from R&D to downstream outcomes R&D Innovation 1 Innovation 2 Innovation 3 Innovation 4 • Backward tracing from a selected outcome to upstream R&D ? R&D ? ? Target Innovation But non-linear! TIA Consulting, Inc. & 1790 Analytics LLC 5 Why trace innovation? • To demonstrate to stakeholders that R&D programs are likely fostering innovation • To show the evolutionary processes by which R&D leads to innovation to increase public understanding and patience • To show that a demonstrably valuable innovation has its underpinnings in a specific R&D program • To identify the influence of an innovation on subsequent innovation • To provide alternative evaluation perspectives • To provide multiple lines of evidence of results TIA Consulting, Inc. & 1790 Analytics LLC 6 How to trace innovation? 3 methods used separately and in combination: • Historical tracing - Interviewing experts - Reviewing documents - Looking for other evidence of linkages, e.g., through licensing agreements • Bibliometric techniques - Analyzing citations of publications and patents - Analyzing “Hot Patents” (patents that are particularly influential) - Text data mining to trace origins and development of ideas • Institutional and Network analysis - Documenting roles and relationships - Diagramming (knowledge-flow) connections among people & organizations - TIA Consulting, Inc. & 1790 Analytics LLC 7 An example from the U.S. Department of Energy (DOE) Purpose: to explore linkages from energy storage technologies used in hybrid electric (HEV), plug-in hybrid electric (PHEV), and electric vehicles (EV) back to DOE‟s R&D investments from 1976 2006. Methods Used: • Historical tracing in combination with • Institutional analysis • Patent citation analysis TIA Consulting, Inc. & 1790 Analytics LLC 8 Study approach • Started with expert interviews and formulation of hypothesized linkages. • Searched for evidence to test hypothesized linkages: - institutional analysis - document review - information on licensing, plus patent infringement - limited patent citation analysis. • Identified barrier to the patent analysis. • Launched a more extensive patent citation analysis. • Formed conclusions. TIA Consulting, Inc. & 1790 Analytics LLC 9 Study findings • Demonstrated real-world relevance of DOE‟s R&D in energy storage to hybrid and electric vehicles • Showed that DOE-funded battery & ultracapacitor patents form a foundation for those technologies used in HEVs and EVs. TIA Consulting, Inc. & 1790 Analytics LLC 10 Expert interviews pointed to: • DOE funding channeled through an industry consortium (USABC) to identified companies. • Licensing of battery technology by a DOE-funded company to all major battery companies. • Payment of related royalties to DOE. • Licensing of IP developed at National Labs to battery companies for development and commercialization. • Charges of patent infringement brought by DOE-funded company against major Japanese battery producers. • Development of battery test protocols used by auto industry. TIA Consulting, Inc. & 1790 Analytics LLC 11 Institutional Roles & Relationships National Labs ANL INL LBL BNL SNL NERL Societies (e.g., SAE) Universities DOE Involvement in Advanced Energy Storage R&D for Vehicles Industry Consortia USCAR USABC Government/ Industry Partnerships PNGV Freedom-CAR Battery Suppliers Auto manufacturers Advisory Panels, Oversight agencies Foreign Competitors, e.g., Japanese R&D & Battery Suppliers & KATECH* R&D Sharing TIA Consulting, Inc. & 1790 Analytics LLC 12 Linkages Identified By Experts DOE/EERE/Vehicle Technologies Program $ Government/Industry Partnerships -PNGV -Freedom-CAR Test results $ National Labs -ANL -INL -LBL -BNL -SNL -NERL Test results R & D S h a r i n g Knowledge— papers/patents/consulting/ CRADAs US Auto Companies -Ford -General Motors -DaimlerChrysler $ Industry Consortium: USABC $ U.S. Battery Company: -ECD Ovonics Group Licensing to many other companies Other U.S. Energy Storage Cos -SAFT* -Johnson Controls -JCS JV (combination of previous 2) -A123Systems -Maxwell Technologies -Compact Power, Inc.** -Other Companies *French subsidiary **Korean subsidiary $ $ Universities Supply of batteries Korean Research Institute (KATECH) Korean Companies -Sanyo -Others Japanese Companies - Matsushita Electric Industrial Co. (MEI) - Panasonic (subsidiary of MEI) - Toyota Motor Company Cross licensing Patent infringement TIA Consulting, Inc. & 1790 Analytics LLC 13 DOE lab-developed test protocols were examined • Served as basis for establishing recommended practices and standards for industry, e.g., Society of Automotive Engineering (SAE J2464: Recommended Practice for Electric Vehicle Battery Abuse Testing TIA Consulting, Inc. & 1790 Analytics LLC 14 Some DOE-supported companies were thought by experts especially important: • • • • • • • ECD Ovonics Group SAFT Johnson Controls JCS JV A123Systems Maxwell Technologies Compact Power, Inc. A desk analysis documented DOE-funding of these companies & further developments TIA Consulting, Inc. & 1790 Analytics LLC 15 Partial list of licensees of ECD Ovonic Battery Co.’s NiMH battery technology Canon Daido Steel Energizer Furukawa GP Batteries Guangdong Shida Battery Harding Energy Hitachi Maxell Hunan Corun Hyundai Intellect Battery Co. Ltd. Japan Storage KAN Battery L&K Battery Technology Company LTD Lexel Battery Linghao Battery (H.K.) Co., Ltd. Matsushita Electric Industrial Co. (parent of Panasonic) SAFT Samsung SANIK Battery Co., Ltd. Sanoh Sanyo Electric Co. Shenzhen High Power Tech Toshiba Battery Etc. TIA Consulting, Inc. & 1790 Analytics LLC 16 Patent infringement charged by ECD Ovonic Battery Co. against major Japanese cos. • NiMH battery technology funded by DOE • Settlement leading to payments to ECD Ovonics and technology sharing agreement • A second connection of Matsushita Electric Industrial Co. (parent of Panasonic) to DOE-funded battery research TIA Consulting, Inc. & 1790 Analytics LLC 17 First Generation Patent Tree for US5348822, Issued to Ovonic Battery Company in 1994 TIA Consulting, Inc. & 1790 Analytics LLC 18 Second Generation Patent Tree for US 5348822, Issued to Ovonic Battery Company in 1994 TIA Consulting, Inc. & 1790 Analytics LLC 19 A difficulty was encountered with the initial patent citation analysis: • An early search for DOE-supported battery patents directly identifiable by searching the patent database on batteries for HEVs and EVs turned up little. • Turns out that companies funded by DOE (through the industry consortium USABC) to develop energy storage technologies often failed to indicate government interest in their patents. TIA Consulting, Inc. & 1790 Analytics LLC 20 Developing an approach to this problem: • This is where Patrick Thomas of 1790 Analytics entered the picture. • He was working at that time with DOE‟s in-house database of publications & patents. • He is an expert in patent citation analysis. • He developed an approach to identifying the relevant DOE patents, and linking them to HEV/PHEV/EV battery patents. • He will now tell you about the approach used in the DOE linkage study, plus other patent analysis techniques useful for tracing innovation, and other studies using these techniques. TIA Consulting, Inc. & 1790 Analytics LLC 21 The Need for Patent Analytics • Some patents are valuable: – 4,901,307 “Spread spectrum multiple access communication system using satellite or terrestrial repeaters” (Qualcomm‟s fundamental CDMA patent) – 6,805,460 “Advanced dog collar flashlight” • Many are not: • With more than a million patents issued in the last decade in the US alone, objective methods are required that identify valuable patents among this mass of data TIA Consulting, Inc. & 1790 Analytics LLC 22 Forward and Backward Citations Exhibit Knowledge Flow Backward Citations (References AKA Prior Art) Forward Citations 17 U.S. Patents 4,901,307 1 Foreign Patent 14 Other Refs, Including: 11 Science References, 2 Books, 1 advert. Qualcomm, Inc. Issued 1990 821 U.S. Patents Citing Qualcomm Patent Starting Patent references prior art, and is cited by later patents Timeline 1990 1991-2007 1971-87 TIA Consulting, Inc. & 1790 Analytics LLC 23 Potential Uses of Patent Citation Analysis • Tracing the development of technologies • Identifying key patents, inventors and organizations across technologies – Importance of normalizing citation metrics to account for differences in patent age, technology, and patent system (e.g. US vs. EPO) – Importance of accurate assignment of patents to organizations TIA Consulting, Inc. & 1790 Analytics LLC 24 Steps in developing patent data sources to support DOE linkage study • Step 1. Identify the total population of US patents linked to DOE-funded research • Step 2. Identify the population of patents related to HEV/PHEV/EV batteries and ultracapacitors • Step 3. Determine the HEV/PHEV/EV battery/ultracapacitor patents identified in Step 2 that were also found in the DOE population identified in Step 1 • Step 4. Identify DOE-funded patents identified in Step 1 that were cited by any of the HEV/PHEV/EV battery/ultracapacitor patents identified in Step 2, e.g. patents for component technologies such as electrolytes TIA Consulting, Inc. & 1790 Analytics LLC 25 Overview of Findings of HEV study • DOE-funded patents represent the second largest portfolio in HEV/PHEV/EV batteries/ultracapacitors • Almost one in five HEV/PHEV/EV battery/ultracapacitor patents cites at least one DOE-funded patent • All 30 organizations with 10 or more HEV/PHEV/EV battery/ultracapacitor patents have at least one patent that cites a DOE-funded patent • A number of very highly cited battery/ultracapacitor patents cite DOE patents, showing DOE‟s role as a foundation for important technological developments TIA Consulting, Inc. & 1790 Analytics LLC 26 DOE-funded patents are cited frequently by HEV Battery/Ultracapacitor Patents Figure 6-3. Organizations whose patents are cited most frequently by HEV Battery/Ultracapacitor Patents Matsushita Electric Dept of Energy (funded) Motorola Telcordia NEC Valence Technology Toshiba Sony Sanyo Fuji Photo Film ExxonMobil Asahi Glass General Electric Isuzu Motors GS Yuasa ECD/Ovonics Dow Chemical 0 100 200 300 400 Number of Citations 500 600 700 800 Self Citations External Citations TIA Consulting, Inc. & 1790 Analytics LLC 27 DOE Patents cited most frequently by HEV Battery/Ultracapacitor Patents Issue Cites from Total Cite Patent Year HEV Patents Cites Index 5907472 1999 16 18 1.44 Assignee Title Maxwell Technologies Multi-electrode double layer capacitor having single electrolyte seal and aluminum-impregnated carbon cloth electrodes Univ California Lockheed Martin EIC Laboratories General Electric US Dept of Energy Supercapacitors based on carbon foams Protective lithium ion conducting ceramic coating for lithium metal anodes and associate method Solid electrolytes Sealing an ultracapacitor Battery and fuel cell electrodes containing stainless steel charging additive 5260855 1993 5777428 1998 5314765 1994 5219679 1993 6212061 2001 4448856 1984 13 12 12 7 7 7 55 17 59 29 8 16 3.53 2.20 4.46 2.40 1.19 1.69 Maxwell Technologies Aluminum-carbon composite electrode TIA Consulting, Inc. & 1790 Analytics LLC 28 Tracing DOE’s impact in three other technologies • Using similar techniques, we have traced the impact of DOE funding in three other technologies – nanotechnology, solar energy, and wind energy – DOE-funded nano patents are cited much more frequently than expected, particularly patents describing semiconductor nanocrystals from Berkeley, and MEMS devices from Sandia – The impact of DOE funding can be traced through generations of solar energy, from traditional solar cells, through thin film cells, to the most recent nanocomposite based cells – DOE-funded patents form an important part of the foundation for variable speed wind turbines; while many recent patents for turbine control have „rediscovered‟ older DOE technologies TIA Consulting, Inc. & 1790 Analytics LLC 29 Using Patent Citations to find Hot Technologies/Next Generation Clusters • We developed a technique for identifying highrisk, emerging technologies for the NIST-ATP program • This technique can be used to identify currently „hot‟ patents, and emerging „next generation‟ technologies • The technique is described in a paper published in Research Evaluation in August 2006 • To locate „hot‟ technologies, we identify patents that are cited mainly by patents issued in the past 12 months. We also identify the „next generation‟ patents offering these citations • Designed to overcome the problem that citation analysis is often a largely retrospective, rather than prospective, tool TIA Consulting, Inc. & 1790 Analytics LLC 30 Using hot patents to demonstrate the impact of DOE funding • DOE‟s Office of Science wanted to trace the impact of DOE‟s scientific funding on high impact technologies • We linked DOE-funded papers to „hot‟ patents – those that are cited particularly frequently by recently issued patents • We found that patents that cite DOE-funded science are much more likely to become „hot‟ patents • We also showed that DOE science is linked to „hot‟ patents in 39 states, and 212 congressional districts TIA Consulting, Inc. & 1790 Analytics LLC 31 Using Next Generation Clusters to Identify Emerging Technologies • Project for US Dept of Commerce Technology Administration • A „next generation‟ patent is a patent issued in the last 12-18 months that references a hot patent • Next generation patents are clustered using co-citations – patents that cite similar groups of patents as prior art are assumed to cover similar technologies • These next generation clusters are seen as representing emerging, cutting edge technologies – an assumption validated using various statistical techniques • These emerging patents can be identified when they issue, with no need to wait for citations to accrue • We found that the highest ranked US clusters were largely tech-related (IT, semics, telecom), whereas leading European clusters were mainly related to life sciences TIA Consulting, Inc. & 1790 Analytics LLC 32 Example US Next Generation Cluster – 3D Memory • Traditional flash memory is based on single layer crystalline silicon substrates, so storage devices are essentially 2D • In the early 2000‟s, Matrix Semiconductor developed 3D stackable memory devices, which provided more power and took up less space • Sharp, Sony, Micron and Infineon are all building on Matrix‟s 3D technology • In 2006, Sandisk paid $250m to acquire Matrix • Underlying hot patent (#3,886,577) is 30 years old, and describes a filament type semiconductor memory. It was largely ignored before 1999, but has been cited 50 times since TIA Consulting, Inc. & 1790 Analytics LLC 33 Example European Next Generation Cluster – Leukemia Detection • One large cluster of next generation patents is related to the use of gene expression to identify leukemia types • Reduces time for diagnosis, and allows treatment regimens to be tailored to the specific type of leukemia • Roche owns many of these next generation patents • The underlying hot patents describe gene expression, and are owned by various life sciences organizations • As new patents issue that cite these hot patents, they can be added to the cluster, revealing new organizations and technological directions in this area TIA Consulting, Inc. & 1790 Analytics LLC 34 Tracing impact based on scientific papers • We are currently working on a project for DOE tracing secondary citations from patents to DOE papers – i.e. cases where a patent cites a patent or paper, which in turn cites a DOE-funded paper • Idea is to identify the influence of DOE funding of basic science, which may not be cited directly in patents • Previously, we have worked on numerous projects for IEEE, showing the impact of IEEE science on patented technologies • We have also worked for the US Naval Research Lab, again showing the impact of its published papers on patented technologies TIA Consulting, Inc. & 1790 Analytics LLC 35 Wrap-up: Tracing Innovation • Questions • Discussion TIA Consulting, Inc. & 1790 Analytics LLC 36 Recent DOE/EERE-sponsored evaluation studies • Overview of Evaluation Methods for R&D Programs (Ruegg & Jordan) • Linkages from DOE’s Vehicle Technologies R&D in Advanced Energy Storage to Hybrid Electric, Plug-In Hybrid Electric, and Electric Vehicles (Ruegg & Thomas) These and other evaluation reports are available at http://www1.eere.energy.gov/ba/pba/program_evaluation/evaluation_documents.html TIA Consulting, Inc. & 1790 Analytics LLC 37