Company Overview and Patent Portfolio
Ericsson is a Swedish telecommunications company founded in 1876. In 2011 Ericsson had 104,525 employees, € 25.5 bn in sales, which is almost half of the sample average, despite an R&D investment of € 3.7 bn.
Region and Number of Patent Application
Ericsson’s historic data for published applications shows that they had significant growth during the years before the IT-bubble, but since then have been back at a relatively stable level. An explanation of this could be Ericsson’s involvement in the mobile phone joint venture with Sony, once called Sony Ericsson, but now known as Sony Mobile Communications. This joint venture lasted from 2001 until 2012 when Sony acquired Ericsson’s shares, which means that all the patents that were produced in the joint venture now belong to Sony. If the data had included the patents from the joint venture, it might have looked very different.
Ericsson’s R&D expenditure matches their patent output when compared to the rest of the sample; both figures are below average and the slow growth seen in recent years matches the sample’s growth.
Ericsson’s 243,288 forward citations compared to their 82,328 total patent applications published show a lower than average ratio. Ericsson’s forward citations are dominated by internal citations, which, along with the low ratio, is a worrying sign. It indicates that Ericsson is not able to invent technologies that are interesting for the rest of the market and, with a below average amount of forward citations, they are clearly not dominating the technological market in the IT industry.
Ericsson’s patent portfolio indicates a weak technological position for the Swedish company. They are not able to produce a sufficient number of quality patents, and the ones they already have, are relatively old. The low activity, immediacy, dominance and scope lead to their rating in the loser category of Campbell’s (1983) company types. Unfortunately, there is no evidence that the case would be much different if we only focused on the mobile communications industry, as this industry also has some very large players such as Samsung, Nokia, LG, Qualcomm, Huawei and Google (which owns Motorola Mobility).
The historic data of Ericsson’s published patent applications shows a big drop around the years when it went into the Sony Ericsson joint venture, which indicates that much of Ericsson’s R&D resources might have gone into that joint venture. A venture they are no longer part of. Thus they are no longer able to profit from many of the inventions from the last ten years. Right now, Ericsson has a narrow technological focus, which can be positive if they manage to dominate this area. Their patent portfolio, however, indicates differently.
Analysis of the Patent Portfolio (PDF)
You can find the complete patent portfolio analysis of Cisco Systems below: