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Do auto manufacturers or tech companies file the most patents?

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【Summary】In terms of investor intelligence, patents rank high on the list of trying to ascertain which companies are on a rising trajectory. Hidden between the lines are the following facts: the number of patents filed doesn’t really represent who is on top. American companies are not hyper-aggressive about filing patents.

Original Anthony    Nov 29, 2016 10:45 PM PT
Do auto manufacturers or tech companies file the most patents?

In terms of investor intelligence, patents rank high on the list of trying to ascertain which companies are on a rising trajectory. So who is filing the most patents for autonomous cars –auto manufacturers or Silicon Valley technology companies?

One article says:

"Automakers, not technology companies, are in the driver's seat in developing self-driving, autonomous cars, and Japan's Toyota Motor Corp (7203.T) is best positioned to lead the way, according to a new report on patents for the fast-evolving technology. As automakers enter agreements with Silicon Valley companies to develop self-driving cars, Tesla Motor Inc. (TSLA.O) and Apple Inc (AAPL.O) would make logical partners.

"The report, by the Intellectual Property and Science division of Thomson Reuters (TRI.TO), is based on a detailed analysis of patent filings by automakers and tech companies for autonomous-car technology. (tmsnrt.rs/1OxPQ3P) The findings illuminate the challenges for both established automakers and Silicon Valley companies as they compete to profit from moving people around in a world that is increasingly congested and concerned about carbon emissions."

The global auto industry is undergoing a major revolution. Data is at the center of this new paradigm. Data involves AI, Machine Leaning and now Deep Learning. Data is a new currency and an energy grid. Wealth is created by data, not mostly from land, although we still need agriculture and natural resources. No one is eating Data Pie. Genghis Khan wasn't rampaging from the Gobi Desert to Moscow, Baghdad and Austria in search of faster download times.

Automakers are in search of the following: green, clean energy that goes beyond the internal combustion engine. That is an old technology. Why are we still using it? Electric vehicles are at the center of this new ethos. Smart cars will be linked to "smart cities" that will better regulate traffic. Autonomous cars piloted by a robot brain will one day be connected to the Internet and efficiently ferry around goods, people and even services with the simple click of a button.

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The aforementioned report continued:

"Toyota is, far and away, the global leader in the number of self-driving car patents. Toyota is followed by Germany's Robert Bosch GmbH [ROBG.UL], Japan's Denso Corp (6902.T), Korea's Hyundai Motor Co (005380.KS) and General Motors Co (GM.N). The tech company with the most autonomous-driving patents, Alphabet Inc's (GOOGL.O) Google, ranks 26th on the list.

"Toyota, the Thomson Reuters report found, has more than 1,400 patents on autonomous-driving devices, more than twice as many as any other company. One recent Toyota patent application, for example, is for software that avoids a car's self-driving system being switched off, and thus defaulting to ‘manual mode' in which the driver controls the car, unless the driver intends to turn off the system."

Hidden between the lines are the following facts: the number of patents filed doesn't really represent who is on top. American companies are not hyper-aggressive about filing patents. Quality, not quantity is the key. Also, it takes a year and a half between the filing of a patent and it's publication for the general public.

While technology companies and auto manufacturers fight over who is number one, the fact remains that they need each other. They are both better off if they cooperate. For example, as noted, a marriage between Apple and Tesla might offer decades of industrial bliss.

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