Cipher in the Top 10 as automation disrupts the patent intelligence market

Cipher is recognised in the Top 10 to Watch in Outsell’s latest market review of Patent Research & Analytics (Hugh Logue, 20 October 2020).

Here are a few of the report highlights:

1. Increased recognition of the strategic value of patents
2. Strategic Patent Intelligence is increasing in sophistication
3. 10 companies to Watch, includes Cipher
4. Recession as a catalyst for change
5. Disruption in the patent services market  

Strategic Patent Intelligence is increasing in sophistication

Outsell says:

“Strategic patent intelligence has grown significantly in sophistication in recent years and is increasingly covered within general patent search platforms and by specialist pure-play providers such as Cipher …

 Business customers use strategic patent intelligence to look for insights into a company’s direction and long-term strategies, such as by identifying the number, age, and quality of a company’s patents in a particular market. This trend is driven by AI analytics and data visualization technology, which can make patent information more relevant to company executives by framing it in a business strategy context instead of a purely legal or R&D perspective. The information can be used in valuations, M&A due diligence, competitor intelligence, portfolio optimization, or the analysis of overall market conditions. Patent data analytics enables businesses to predict the next waves of innovation within their particular industries and markets.

 Solutions like Cipher use supervised machine learning and are designed to automate and compete with manual patent search services. As a result, this subsegment has significant growth potential: it does not so much compete in the patent research market as threaten to disrupt the manual search services. This market presents white space growth opportunities by potentially improving the quality of manual work while also dramatically decreasing the cost of manual services. The combination opens up a latent demand for strategic patent intelligence.”

 The Cipher view is that strategic patent intelligence is a new category of analytics. The emphasis is on the business and long-term strategies, and not tactical and operational decisions. See our work on Portfolio Optimisation and Competitor Intelligence

Recession as a catalyst for change

 Outsell says:

“Yet new opportunities for patent information and technology providers are present – providers and investors just need to know where to look. COVID-19 has led companies to cut their outsourced patent search services, creating a need for tools to support patent search and analysis tasks in-house for novice users. Providers need to converge different offerings to add value and target the adjacent services market by automating expensive manual services. Advanced semantic search, comprehensive global patent coverage, rich user interfaces, and AI tools are no longer product differentiators – they are considered standard features.

The pandemic and resulting recession are making customers focus on protecting their core businesses for survival. However, the messaging of many patent solution providers is still stuck in 2019, emphasizing their innovative AI tools instead of how this technology can help companies cut costs, such as by replacing outside manual services. Indeed, hyped-up language about cutting-edge AI may actually work against providers by creating the impression that it is a luxury and not a core need. Providers need to replace such messaging with language about ROI, productivity, and efficiency capabilities.

 The messaging needs to target C-suite executives who are less likely to care about keyword clustering, semantic search, patent classification analysis, and so on. Instead, these decision-makers are more concerned with how it will add revenue, cut costs, or get their products to market faster.”

 The Cipher view is that as with remote working, video conferencing, home exercise, the pandemic will accelerate many of the digital transformations that have been on the patent agenda, but perhaps not a priority. Now the focus is both on spend and efficiency. The reality is that the significant patent budgets can no longer escape scrutiny and slow and expensive patent search will no longer be acceptable.