Business Method Patents Research Articles

ELIGIBILITY OF BUSINESS METHOD PATENT IN MALAYSIA

This paper analyses the patentability of business methods in the United States, United Kingdom, and Malaysia. In order to do this, we compared the existing law, court cases, and government guidelines in respective countries on how they assess the patent application for computer or software operation as a method of doing business in this technological era. Our results showed that business methods were historically not patentable but are now eligible for patentability in some countries. This type of invention could be patented in the United States but not in the United Kingdom and Malaysia. Despite being allowed to be patented in the United States, there are still arguments and development by the Court and the United States Patent & Trademark Office regarding the assessment of the claim. For United Kingdom, despite the exception in United Kingdom Patents Act 1977, a thorough look reveals that business methods are actually eligible for patentability in the United Kingdom but somewhat under stricter legal conditions. As for Malaysia, there is as yet a reported case that has judicially considered the scope of this exclusion but it can be seen that Malaysia also starting to acknowledge the patentability of business methods. This study emphasizes the development of assessing patent applications for the method of doing business invention along with the changes and advancement of these days technology.

A Novel Technology Intelligence Tool Based on Utility Mining

The technological intelligence tools that companies need to achieve sustainable development in today's digital age are extremely limited. To fill this gap in the literature, a novel technology intelligence tool is developed in this article. The developed technology intelligence tool uses patent analysis and utility mining. It is based on the HUP-growth mining algorithm, which is one of the utility mining algorithms, to find the relationships between technologies. The developed technology intelligence tool has three contributions to the literature. First, the importance level of the technologies and the repetitions of each technology in a patent have been taken into consideration. Second, the existing studies in the literature cannot use a technology intelligence tool to explore the relationships between technologies. Third, the developed technology intelligence tool is more successful in finding hidden patterns among patent documents. A real-life case study of business method patents about electronic shopping is conducted to show how the developed technology intelligence tool works in practice. The Apriori algorithm is also used to compare the results obtained from on the HUP-growth mining algorithm. The results of this study show that companies can quickly and effectively find association among technologies under concern using the developed technology intelligence tool.

Exploring Knowledge Trajectories of Accounting Information Systems Using Business Method Patents and Knowledge Persistence-Based Main Path Analysis

In this paper, the development trajectory of accounting information systems was analyzed using business method patents and main path analysis based on knowledge persistence. Knowledge persistence-based main path analysis can dramatically minimize the complexity of a knowledge network without omission of the dominant knowledge flows, and so it is a suitable selection for analyzing the business method patents on accounting information systems. The main findings from the empirical results are as follows: the empirical results show that accounting information system patents were developed along with the software patent of knowledge injected from the outside. Bookkeeping/accounting and taxation systems expanded from the basic calculation, storage, and payment technique to scalability to other techniques and functions in more complex situations. This research has found that technological advancement has facilitated and been supporting the development of accounting information system over the years, as shown in the patents filed under business solutions. There is a clear indication of the growing complexity of those patents, signifying the moves/advancement of corporate business information systems from financial accounting-oriented systems to more complex ERP systems.

Business Method Innovation in U.S. Manufacturing and Trade

Problem definition: In what kinds of business method innovation do firms in the manufacturing and trade sectors engage? Does engaging in business method innovation create value for these firms? The present paper answers these questions using empirical evidence. Methodology/results: Using text analysis of business method patents, we show that business method innovation in the U.S. manufacturing and trade sectors is aimed primarily at improving the business operations that support the sales of tangible products—that is, how the firm targets customers, manages product delivery, or enhances the product through service offerings. We then evaluate the effect of having business method innovation, as evidenced by patents, on a firm’s value. Leveraging the exogenous shock of the State Street ruling, which first recognized business methods as a patentable category of innovation, we identify a set of firms that possess business method patents and a matched set of comparable firms without such patents. Then, using a difference-in-differences with firm fixed effects model on the matched sample, we show that the valuation of the former set of firms increased by 9% after State Street, as measured by Tobin’s q. We further show that (1) business method innovators in the manufacturing sector gained a 7% increase, whereas business method innovators in the trade sectors gained a 25% increase; and (2) only firms with broader innovation scope—that is, business method innovations covering the range of customer targeting, product delivery, and service support of products—experienced a significant (18%) value bump. Managerial implications: This research provides evidence that business method innovation in the manufacturing and trade sectors primarily involves innovating in business operations that support product sales. Our work also provides empirical support for the proposition that engaging in business method innovation drives manufacturing and trade firms’ market performance.Supplemental Material: The online appendices are available at https://doi.org/10.1287/msom.2022.1129 .

The Effect of USPTO’s Quality-Improving Initiatives in 2000 on the Claim Scope of Business Method Patents

The Effect of USPTO’s Quality-Improving Initiatives in 2000 on the Claim Scope of Business Method Patents

Business Method Innovations and Firm Value: An Empirical Investigation

Problem Definition. Are business method innovations valuable to manufacturing firms? Do patents further increase their value? Our paper provides answers to these questions with empirical evidence. Academic/Practical Relevance. Despite increasing academic and practitioner attention on business method innovations, there is a lack of empirical evidence regarding the economic value of business method innovations to manufacturers. Our work points to both business method innovations and business method patents as central sources of firm value. Methodology. We leverage the exogenous shock of the 1998 State Street ruling, which first recognized business methods as a patentable category of innovation and allowed US manufacturers to patent their business method innovations. We estimate separately the impact of business method innovations and business method patents on firm value. Results. We find that firms that were granted business method patents after State Street enjoyed a 16% value premium relative to peers with no such patents. We show that this premium consists of two components. This set of firms enjoyed an 11% value premium even before State Street was decided, and saw an additional 12% value increase post–State Street. The former can be viewed as the innovation premium (the value of undertaking business method innovation); the latter may be considered a patent premium (the value of owning intellectual property protection). We corroborate the innovation premium by showing that firms that had filed applications for business method patents (but were yet to receive any business method patent grants) exhibit only the innovation premium, and not the patent premium. We further confirm the existence of a patent premium for business methods by showing that business method patents are more likely to be renewed in comparison to other types of patents. Managerial Implications. This research provides empirical support for the widely held assumption in the operations and strategy literature that, in the digital age, business method innovations are key drivers of manufacturing firms’ performance.

How business methods accompany technological innovations – a case study using semantic patent analysis and a novel informetric measure

Usually, the development of a technology interacts with the development of business methods, which are needed to enter the application fields. For some years now, it is possible to analyse their interaction as, next to technological innovations, business method innovations can be patented. To investigate this interplay, we select the case of radio frequency identification devices (RFID) – a technology that first emerged many years ago, but is still undergoing further development. We analyse approximately 37,000 patents related to RFID technology from the period between 1990 and 2014, differentiating between technological and business method patents, by means of bibliographic and semantic analyses, using one well established and one novel informetric measure. Contrary to our expectations, the results point to technological innovations that are not ensued but constantly accompanied by business methods. Furthermore, we identify two types of players, that is technology and application specialists. There is a clear distinction between these two types, though all companies of both types apply for technological as well as business method patents. As our semantic analysis reveals, RFID were successively introduced in their application fields between 1998 and 2008, starting with industrial applications, and then moving on to service applications. In future, technology managers should develop strategies based on the interaction between technological and business method patents, keeping in mind the early start and sequential development of different application fields.

Identifying Emerging Trends of Financial Business Method Patents

Financial technology has become an important part of the banking industry in recent times. This study attempts to propose a framework to identify emerging areas and trends using financial business method patents. Based on the abstracts of financial business method patents registered at the United States Patent and Trademark Office, this study first applies latent Dirichlet allocation to identify emerging topics. The probability of the annual occurrence of each topic is adjusted through the exponentially weighted moving average to reflect the importance of the recent probability of topics. Each topic is classified as “hot” or “cold” depending on whether the exponentially weighted moving average of the probabilities exceeds the threshold. We applied survival analysis to the time gap of recurrently becoming hot from a cold status with the associated factor of financial business method patents. The findings suggest that the topic with the short granted period and high forward citation is likely to become hot. In addition, the topic that is aged and specific in narrow areas is likely to continuously change into the hot or cold status. The approach proposed in this study contributes toward understanding topic emergence in the financial area and pursuing sustainable development.

Identifying dynamic knowledge flow patterns of business method patents with a hidden Markov model

As an alternative to the conventional R&D innovation, business models are becoming an important locus of lucrative innovation. Due to the rise of the internet economy, business model innovation today often involves technological innovation, and this can be evidenced by business method (BM) patents. Of several mechanisms that stimulate business model innovation, the role of BM patents is probably most noteworthy. To understand how BM patents play their roles in business model innovation, we need to observe the long-term knowledge flow process. Therefore, we aim to identify dynamic patterns of knowledge flows driven by BM patents using a hidden Markov model (HMM) and patent citation data as an input. An HMM is a popular statistical tool for modelling a wide range of time series data. Since it does not have any general theoretical limit in regard to statistical pattern classification, an HMM is capable of characterizing various temporal patterns. A case study is conducted with the BM patents in 16 USPTO subclasses related to secure transactions. After patterns of the individual subclasses are generated, they are grouped into four major patterns through clustering analysis and their characteristics are closely examined. Our analysis reveals that the BM patents for secure transaction in general play increasingly important roles in advancement of business models, facilitating the transfer of knowledge, and thus can provide valuable insights in formulating more effective strategies or policies for business model innovation.

Recent EPO Decisions on Business Method Patents

This report examines some recent European Patent Office (EPO) Board of Appeal decisions on business method patents. According to the European Patent Convention (EPC), methods for doing business are not regarded as inventions if they’re claimed “as such” in a patent application. In most cases, EP patent applications on business method patents are rejected for lack of an inventive step and not according to Art. 52 (2) (c) of the European Patent Convention (EPC). A state-of-the-art search in the “technical field” of business methods is also presented.

Investor perception and business method patents: A natural experiment

The 1998 State Street Bank & Trust Co. v. Signature Financial Group court case is largely responsible for opening the door on the issuance of business method patents, while the 2008, in re Bilski decision closed it (at least partially) once again. The result of the first decision was a significant increase in the number of patents issued and law suits filed for infringement. This paper is the first the authors are aware of to utilize these court cases as natural experiments to gauge investor belief regarding the utility of business method patents on publicly traded companies. We find that investor beliefs about the effect of business method patents on company value evolved between 1998 and 2008, as investors modified their expectations for the effects of the in re Bilski decision based on what actually occurred after the State Street decision. We also find that investor sentiment varied by industry subsector. Our findings offer insights into the ongoing debate over the utility of business method patents, which may inform managers, investors, and both statutory and regulatory policy makers.

An Overview on Pros & Cons of Business Method Patents (BMPs)

Of late, there has been a gradual shift in how the courts treat the issue of patentable subject matters and its exceptions in judicial systems. The biggest challenge in patent laws is to strike a balance between protecting inventors and preventing the creation of monopolies that would frustrate innovation and invention. Where the balance should stand is not the issue guiding such legal opinions. Patents essentially should further the basic economic ends of efficiently allocating resources, and how much business methods have been fostered by this and whether patents on such methods should be accepted or rejected are the subject of much debate. In fact the various opinions on the patentability of business method programs have remained unclear among judicial systems. This study examines the patentability of business methods by discussing the various pros and cons opinions. The main objective of this study is to clarify the various positions by previous authors in line with the BMPS and lead it to advance the position that there is a need to provide patent protection to business methods and their inventors. DOI: 10.5901/mjss.2016.v7n4p35

Identification of a technological chance in product-service system using KeyGraph and text mining on business method patents

Notwithstanding the prevailing trend towards a product-service system (PSS), literature has not fully supported a company's PSS innovation due to an absence of available data and a lack of quantitative methodology. In particular, despite the importance of technology in PSS, literature has paid little attention to technology as an innovation source of PSS. In order to fill this academic and practical lacuna, this study proposes a database-centred approach for the identification of technological chances in PSS as an innovation source. For analysing PSS innovation, business method (BM) patents are utilised as a data source; further, the complementary pair of KeyGraph for chance discovery and text mining for knowledge discovery is systematically applied as a quantitative methodology. To illustrate the utility of the proposed approach, the case study of PSS in the mobile area is presented.

Alice v. CLS Bank: Are US Business-Method and Software Patents Doomed? Part 2

This column is the conclusion to a two-part series on the recent Supreme Court case of Alice Corporation Pty. Ltd v. CLS Bank International and the question of whether patents can be issued on computer-related innovations and, more broadly, on business methods and software. This column describes the Supreme Court's Alice decision, the industry's reaction to the decision, and the apparent consequences for both software and business-method patents.

Setting Up Fences in Cyberspace: Internet Technologies and Business Method Patents in E-Commerce

Even after software became patentable in some jurisdictions, the debate about the patentability of business methods still continues.The first section of this paper begins with a general introduction which provides an overview of the technological background of business patents and emergence of e-Commerce. The second section describes the various perspectives in relation to patentability of computer implemented business methods with particular emphasis to the patent law in the United States and Australia. The pitfalls of internet and e-commerce patents are reviewed in the third section. The fourth section describes the infringement of e-Commerce business method patent. Section five concludes with the significance of implementing the new regimes for e-Commerce patents.

Are Prior User Rights Good for Software?

The America Invents Act (“AIA”) gave modern patent law in the United States a general prior user rights defense. The patent right is enforced via infringement litigation, but enterprises sometimes obtain patents for defensive purposes. Alternately, an enterprise that does not pursue a patent for an invention may choose to use the invention under trade secrecy protection. However, trade secrecy protection leaves a prior user vulnerable because a later inventor may patent the innovation and enjoin the prior user from further use. Styled as an infringement defense for a “prior commercial use,” the AIA defense replaces a decade old “earlier inventor” defense that arose from a software system patent infringement case and applied only for business method patents. This article assesses the AIA’s prior use defense from the perspective of software technology in view of the contentious issues around software patenting. It concludes, first, that courts should interpret the defense, or congress should alter it, to ensure its efficacy for software. Facially, the defense suggests a manufacturing motif, although its applicability to commerce in software may be stronger than suggested at first glance. Second, this article assesses the potential impact of a prior use defense on intellectual property protection in software. Some have posited that, as a general matter, the defense may create an incentive to favor trade secrecy over patenting. Regardless of the strength of that logic for other technologies, it seems lacking for software. While the use of the defense for software patent infringement will depend on the defense’s efficacy, there is also the question as to the defense’s impact on software patenting. One potential impact is on defensive patenting. Will software firms engage in less defensive patenting if there is an efficacious prior use defense?

Project Management–Related Software Systems and Their Legal Protection: Emergence, Distribution, and Relevance of Business Method Patents

The legal protection of project management–related software systems has changed recently, as patenting is spreading to the area of business methods. We investigate which parts of project management are especially confronted with this form of legal protection and how software system providers deal with this topic. Almost all the tasks of project management are permeated by business method patents but the intensity of these tasks differs remarkably. Their assignment–-related to major project management software system providers–-is unbalanced. While patenting-experienced companies have already learned how to use business method patents to gain advantages in project management environments, many others have not.

Business Method Patents and Indian IT Industry: An Analysis

Business Method includes activities in a commercial or industrial enterprise relating to transaction of goods or services. Business Method is a process of doing business either in traditional means or virtual means. The various organizations are inventing the new means/tools of conducting business through virtual mode that are software or software based. The patent system has been evolved to protect invention. Now, the question arises regarding business method as invention as well as patent eligible subject matter. Business Method does not qualify as patentable subject matter in various jurisdictions. This paper aims to explore ambit and scope of business method patents. It has been observed through this study that most of the companies located in countries where business methods are per se not allowed ( as shown above in the case of India) are filing their patents in the foreign jurisdiction that may lead to potential revenue loss from patent filing in host countries.

IP Kenya: A blog review

‘A book may be good for nothing; or there may be only one thing in it worth knowing; are we to read it all through?’ (Samuel Johnson) This section is dedicated to the review of ideas, articles, books, films and other media. It will include replies (and rejoinders) to articles, the evaluation of new ideas or proposals, and reviews of books and articles both directly and indirectly related to intellectual property law. Although starting with a mystifying and slightly confused post in Latin, Victor B. Nzomo's IP Kenya Blog subsequently delivers what it promises: it is insightful, informative and covers a broad area of IP subject matter both on a Kenyan and on a pan-African level. The blog entries, the author's personal input and the readers' comments have progressively increased since January 2011, when the blog was launched by the Kenyan lawyer. With an average of six entries per month in 2013, some posts spark debates on controversial aspects of IP—in Kenya and worldwide—such as the legislative protection of traditional knowledge, the granting of business method patents and the institution of an autonomous publicity right. The author summarizes all Kenyan IP legislative acts and reports pertinent cases, mainly from East and South Africa.

Non-Practical Entities: Business Method Patents and the Digitization of Culture

Business method patents are a special class of patents that allow companies to assert ownership over technologies and the ways in which those technologies are put to use. Looking at the history of business method patents in the United States and the recent resurgence of this type of patent activity in the mobile and handheld computing sectors, I argue that business method and related software patents act as quiet quests for control over information and cultural practices. Business method and software patents highlight how certain actors use moments of technological change to secure economic and cultural advantages through law and regulation. Instead of fostering innovation and rewarding inventors, these patents are an impractical form of intellectual property that seeks to mimic traditional conceptions of physical objects in an era of digital goods. This article serves as a call for scholars undertaking research on the migration of media and culture to new digital formats and devices to consider how patents act as protocols that pre-inscribe devices with certain features, gestures, and meanings. As an increasing variety of cultural goods such as music, movies, and books migrate into digital formats online, business method and software patents have significant implications for the production, circulation, and use of digital commodities.