Is Smartphone Innovation Slowing?

In 2014 some wondered this, citing fewer new improvements in smartphones. A qualitative argument about features. Here is a different and quantitative take, with possible ominous implications for the industry. Figure 1 is the patent applications received by the US Patent and Trademark Office and the patents granted, with the phrase “mobile device”. From 2005 to 2015. Each year for a 12 month period, from 19 June of the previous year to 18 June of the current year.

Figure 2 is for “smartphone”. The numbers are smaller than Figure 1 because a smartphone is a special type of mobile device.

The figures are consistent. First, applications peak in 2013 for mobile device and in 2014 for smartphone. Now see the patents. The falloff is far more dramatic, especially in 2015. Why?

Applications are a leading indicator and patents are a trailing indicator. When you file an application, it is usually published 18 months later. In the figures, the bins for the applications refer to when they were published. Then several months are spent in arguments between you and the Examiner. This can take years to resolve; to get a patent or drop it. Roughly, when you look at a patent bar, it corresponds to applications from the current and previous years.

The big growth in smartphone applications in 2012 to 2014 reflects the rise in the global market for smartphones. The levelling off in 2014 is a saturating in the volume of new ideas. An application is an optimistic event in the innovation marketplace. Even optimism is saturating. Harder and harder to find new patentable ideas.

Now look at 2015 for smartphones compared to 2014. Just that tells you that the PTO is finding far fewer new ideas worthy of patents. Even more striking compared to the applications for 2014 and 2015, from which most of those patents presumably came from.

A bitter harvest.

Most recent applications are simply redundant. Filed by companies who did not search sufficiently the prior art. Or who were simply casting around with trivial me-too ideas and hoping for the best. Not surprising. Every technology saturates. Each defines a space of buildable ideas and that space gets filled if the technology is valuable enough.

The future? At the business level, the market for smartphones is starting to saturate in North America, east Asia and Europe. At the invention level is a slowing of innovation. Which is not necessarily bad. We may be moving to kaizen, like autos. Profits can still be made.

[The author is an inventor, with 16 US patents on cellphones.]