Chinese patent problems

[jbond197]

Chinese patent problems

An interesting read...

Here’s a chart posted a couple of weeks ago by economist Mark Perry, based on data from different regions’ patent offices and collected by the World Intellectual Property Organization:

In addition to wondering about potential methodological differences in the patent process across countries, we question how much, if anything, this information actually tells us about genuinely innovative activity in China. (Which we would distinguish from more broadly-defined entrepreneurial activity like, say, starting a business.)

Perry, for one, seems enthusiastic:

In 1995, China granted only 3,393 patents, about 3% of the number of patents registered in the U.S. (101,419) and Japan (109,100) in that year. In 2004, China granted more patents than Korea for the first time, and in 2005 more patents than Europe. By 2009, China granted more patents (128,489) than Korea (56,732) and the European Patent Office (51,969) combined.

And towards the end of last year, Thomson Reuters gave the Chinese patent boom an enthusiastic gloss in a long report, going so far as to breathlessly say that “it is clear that China will soon reach another superlative as the world’s top innovator. … Never before in history has such a concentrated culture of innovation grown so quickly and with such unity of purpose.”

We’re not buying it.

This correspondent is no expert on international patent comparisons, but we suspect that these data mostly just tell the typical story of China’s rise up the technology value-chain and its use of industrial policy to accelerate growth on the back of already-existing technologies.

In other words, the huge amounts of state-driven R&D and the push out of agriculture and industry into technology in recent years will certainly lead to more patents and more enterprising activity, but that’s different from arguing that China will become a big driver of inventions that meaningfully expand the frontiers of innovation.

Here’s a paragraph from the Reuters report that was seemingly ignored in the report’s conclusion, but which we would emphasise (we found and inserted the links ourselves):

While Chinese patent statistics continue to make headlines, both government insiders and legal experts express concerns about patent quality. An article in the Financial Times indicates that the patent figures reflect a concerted government campaign to persuade Chinese companies to protect their intellectual property by law, and that government subsidies to cover patent application costs is a factor that artificially inflates the number of filings. Chen Naiwei, director of the Intellectual Property Research Centre at Shanghai Jiaotong University, echoed the view that many local governments have provided patent fees to enterprises and science institutes, resulting in the rapid growth in applications. Most patents filed in China are for a new design appearance or new models, which do not require great technical innovation, he adds. Utility model patents are particularly popular with domestic applicants because they are easier and faster to prepare, do not undergo substantive examinations before being granted, and cost less. For these reasons, utility model patents may intrinsically be of substandard quality.

“Utility model patents” are awarded to new ideas applied to already-existing products. And if you read the FT article cited above, it’s clear these patents are historically quite easy to obtain — or in the words of the legal expert cited in the article, as of mid-2008 “you could patent a wheel in China, and get it through”.

That was three years ago and the patent laws have since allegedly been tweaked; yet the number of these patents continues to increase and there now appears to be roughly the same quantity of these utility patents granted annually in China as proper invention patents (click to expand):

And that’s before we discuss the quality of the invention patents themselves.

The usefulness of patent grants as a measure of innovation in the US is, we think, becoming increasingly dubious — and if anything, they might even be more accurately understood as a kind of incumbent protectionism (a subject for another time). There’s certainly no reason to think it’s any more useful in China, where the laws governing intellectual property are young and will doubtless continue to evolve.

——

Relatedly, a hat tip to our colleagues at Beyond Brics for linking to the very funny story of these expats in Kunming, China who came across three fake Apple Stores in walking distance of each other. The ripoffs are impressive indeed, and in one of these stores, the expats “struck up some conversation with these salespeople who, hand to God, all genuinely think they work for Apple.” Beyond Brics writes:

While we at beyondbrics are laughing at the hilarity of it all, Apple and Steve Jobs are probably not amused. News of the “clone” Apple store comes just a day after the company highlighted the role China has played in its blockbuster results.

Tim Cook, chief operating officer, said China was key to the company’s results, with sales up more than sixfold year-on-year in China and Taiwan, reaching $3.8bn.

And as breakingview noted, China is where Apple has the biggest opportunity given the low penetration rate of smart phones among the country’s 910m mobile phone users. Last thing it wants is China’s monied class buying fakes thinking they are real.

Or that Apple doesn’t know how to spell:

 

[IndoCarib]

Leave it bro. They file 10 times more patents than us. And that's what matters. Chinese govt provides incentives for its people to file patents as this article suggests

Innovation in China
Patents, yes; ideas, maybe
Chinese firms are filing lots of patents. How many represent good ideas?

NO PATENT law existed in China until 1985, and the country has a deserved reputation for trampling on intellectual-property rights. But that could be changing. Anxious to promote domestic innovation, the Chinese government has created an ecosystem of incentives for its people to file patents.
Professors who do so are more likely to win tenure. Workers and students who file patents are more likely to earn a hukou (residence permit) to live in a desirable city. For some patents the government pays cash bonuses; for others it covers the substantial cost of filing. Corporate income tax can be cut from 25% to 15% for firms that file many patents. They are also more likely to win lucrative government contracts. Many companies therefore offer incentives to their employees to come up with patentable ideas. Huawei, a telecoms-equipment manufacturer that craves both government contracts and global recognition, pays patent-related bonuses of 10,000-100,000 yuan ($1,500-15,000).
Such incentives produce results. In 2008 Huawei filed more international patents than any other firm in the world. China’s overall patent filings grew by 26% a year between 2003 and 2009, says a new report from Thomson Reuters, an information service. Growth was much slower elsewhere: 6% in America, 5% in South Korea, 4% in Europe and 1% in Japan.
Extrapolating, Thomson Reuters concludes that China will become the world’s largest publisher of patents next year. Straight-line projections are not always reliable. But Dave Brown, president of the intellectual-property division at Thomson Reuters, says he is confident that this is indeed the way things are going. If China becomes the world’s top patent-generator, the world’s press will go wild.
Yet there are reasons for scepticism. The bureaucrats in Chinese patent offices are paid more if they approve more patents, say local lawyers. That must tempt them to say yes to ideas of dubious originality. And the generosity of China’s incentives for patent-filing may make it worthwhile for companies and individuals to patent even worthless ideas. “Patents are easy to file,” says Tony Chen, a patent attorney with Jones Day in Shanghai, “but gems are hard to find in a mountain of junk.”
A cottage industry has sprung up to produce patents of suspect value. On Taobao, the Chinese eBay, patent writers and filers advertise their services for as little as 700 yuan for individuals or 2,000 yuan for corporations. Most of these patents are probably filed with the expectation that they will be ignored.
Some of this flimflam is captured by Thomson Reuters, which distinguishes between “invention patents”, which require an examination to see if an idea is really novel, and “utility-model patents”, which may be registered without an inspection and which confer lesser rights: only ten years of protection rather than 20. In recent years the number of utility-model patents has been growing particularly fast in China, and now equals the number of invention patents. Only a fifth of professionals working with patents surveyed by Thomson Reuters believed that Chinese patents were of high quality, a lower proportion than in any other region in the study.
Yet despite all this, it is clear that China really is growing more innovative. And the fact that the government now takes intellectual property seriously can only help. In the past year a German company has won a settlement of $3m in Beijing for infringement of its design for a bus, a British company has sued successfully over the heating element of a kettle and a firm from Wuhan has won $7m in a case against a company from Fujian and its Japanese supplier over the use of a process to clean sulphur. If ideas are protected, Chinese people will produce more of them.

Innovation in China: Patents, yes; ideas, maybe | The Economist

 

[jbond197]

^^^
I found lots of Chinese bragging about it on this forum and I came across this article which actually did a good factual analysis of the claims and this is what came out of the whole exercise

Most patents filed in China are for a new design appearance or new models, which do not require great technical innovation. Utility model patents are particularly popular with domestic applicants because they are easier and faster to prepare, do not undergo substantive examinations before being granted, and cost less. For these reasons, utility model patents may intrinsically be of substandard quality.

So basically it says they are giving new look /appearance to already existing products and not coming out with any new products themselves. That probably is the reason that even with so many patents under their belt, there is no product that can be called conceptualized, designed, produced in China by Chinese. Now once they do that then i will call it innovation but unfortunately till now its all substandard copying/redesigning...

 

[NeutralCitizen]

Why has their been a increase of China related articles from Indian members ? Indian members are starting to act like trolling Pakistani members.

 

[grey boy 2]

Oh dear, a proud citizen from a "patent midget" nation lecturing China regarding "patents"? are you for real?
And you must be running out of "China bashing" bullets and now you go to a new low by quoting from a "BLOG" good going boy.
Lets face it, admit it like a "MAN", even a blind man could easily tell why you have been digging dirt about China on a daily basis= "Jealousy Kill" one day its going to bite your own b@tt, my dear bharati bhai.

 

[IndoCarib]

China is using these patents as a economic weapon against the west . Chinese can brag on forums like this ! but truth is somehwhere between their bragging and article like this :

China's patent strategy worrying foreign firms - The China Post

 

[darkhero]

^^^
I found lots of Chinese bragging about it on this forum and I came across this article which actually did a good factual analysis of the claims and this is what came out of the whole exercise



So basically it says they are giving new look /appearance to already existing products and not coming out with any new products themselves. That probably is the reason that even with so many patents under their belt, there is no product that can be called conceptualized, designed, produced in China by Chinese. Now once they do that then i will call it innovation but unfortunately till now its all substandard copying/redesigning...

Like it or not, China is much better than India in each and every field, including your proud software and pharmaceutical industry, period.

Tell us what you Indians have invented in your history? Don't say ZERO.

Btw, Chinese Americans filed two times more patents than Indian Americans too even the population is close.

Seriously, if you can not do it better, just stop talking it. My suggestion.

 

[grey boy 2]

Perhaps you bharaties should use your energy to improve your own country, doing catch up instead of trying so hard to down play and be little other's achievement to satisfy your jealousy butt hurt. However no matter whatever bashing you leash out, does that help to change the "reality" that India will still be living under the shadow of China?

 

[jbond197]

Oh dear, a proud citizen from a "patent midget" nation lecturing China regarding "patents"? are you for real?
And you must be running out of "China bashing" bullets and now you go to a new low by quoting from a "BLOG" good going boy.
Lets face it, admit it like a "MAN", even a blind man could easily tell why you have been digging dirt about China on a daily basis= "Jealousy Kill" one day its going to bite your own b@tt, my dear bharati bhai.

Idiot, If you can read then you can figure out the article is not written by me or any Indian. Also if you can I challenge you to prove the content of the blog wrong.. No body is advising you on anything.. Wise person can understand on its own..

 

[jbond197]

Like it or not, China is much better than India in each and every field, including your proud software and pharmaceutical industry, period.

Tell us what you Indians have invented in your history? Don't say ZERO.

Btw, Chinese Americans filed two times more patents than Indian Americans too even the population is close.

Seriously, if you can not do it better, just stop talking it. My suggestion.

Again you got it wrong sir. Nobody is comparing China and India here. I would advise go through the article and talk about it rather then going off topic

 

[Chinese-Dragon]

Tell us what you Indians have invented in your history? Don't say ZERO.

The number Zero was invented by the Persians actually.

India did not exist until 1947, and I have no idea what they invented.

 

[jbond197]

Perhaps you bharaties should use your energy to improve your own country, doing catch up instead of trying so hard to down play and be little other's achievement to satisfy your jealousy butt hurt. However no matter whatever bashing you leash out, does that help to change the "reality" that India will still be living under the shadow of China?

Again no body is getting jealous or getting butt hurt here.. It's only you who is getting offended when plain facts are presented in front of you.. BTW, prove any facts in the article as wrong if you wish to and we can debate on that. Stop getting off topic for a change..

 

[IndoCarib]

Like it or not, China is much better than India in each and every field, including your proud software and pharmaceutical industry, period.

Tell us what you Indians have invented in your history? Don't say ZERO.

Btw, Chinese Americans filed two times more patents than Indian Americans too even the population is close.

Seriously, if you can not do it better, just stop talking it. My suggestion.

Any link to your claim ?

 

[jbond197]

The number Zero was invented by the Persians actually.

India did not exist until 1947, and I have no idea what they invented.

Ok genius.. now lets talk about the topic for a change. reply to this if you can..

Most patents filed in China are for a new design appearance or new models, which do not require great technical innovation. Utility model patents are particularly popular with domestic applicants because they are easier and faster to prepare, do not undergo substantive examinations before being granted, and cost less. For these reasons, utility model patents may intrinsically be of substandard quality.

 

[IndoCarib]

The number Zero was invented by the Persians actually.

India did not exist until 1947, and I have no idea what they invented.

LOL !!! do you know that the word China came from ancient Indian language sanskrit ??

here ! get some real education ! Baidu is not the best place for search!

Invention Of Zero | InterestingFacts.org