Tuesday, October 26, 2010

Business Methods Patent Stats Fall 2010

Business Methods Patents represent the new frontier in intellectual property. These are the digital inventions of the new millennium. Business Methods remain a nascent part of the US and international patent universe that continue to grow in number and importance. Our Business Methods analysts took a look at the status quo in Class 705 to provide insight on this important domain.

As of September 28, 2010, USPTO had issued 51,558 patents that are classified as business methods. The table below provides the breakdown of where these patents are classified.



Planning and Innovation


Marketing, Selling, Evangelizing


Exchanging Money for Stuff


Watching the Store


The Protection Racket


None of the Above




Here's a quick look at how we define the major areas where USPTO groups business methods patents. For more detailed insight see our earlier Business Methods Monday posts.

The Patent Office defines Business Methods Patents as those patents classified under Class 705 - Data Processing: Financial, Business Practice, Management or Cost/Price Determination. The high level definition put forward by USPTO is:

Machines and methods for performing data processing or calculation operations in the:

  • Practice, administration or management of an enterprise, or
  • Processing of financial data, or
  • Determination of the charge for goods and services.

PTO defines four classes as business methods patents but includes a fifth in class 705 which has do with business cryptography and digital security. We use our own group titles to describe what is going on in the Business Methods Arena. They conform to the USPTO groupings but are a little easier to understand.

Planning and Innovation - Determining who your customers are and the products and services they want or need. USPTO describes this as Operations Research and Market Analysis.

Marketing, Selling, Evangelizing -- These patents are about informing customers that you exist, showing them your products and services and encouraging and providing incentives for them to make purchases. This covers advertisement management catalog systems, incentive programs and redemption of coupons.

Exchanging Money for Stuff -- This group of business methods patents covers all aspects of exchanging money and credit before, during, and after a business transaction. This includes what you would expect - credit and loan processing, point of sale systems, billing, funds transfer, banking, clearing houses, tax processing and investment planning. (Investment planning seems a little out of place.)

Minding the Store - Here you'll find the patents that deal with tracking resources, money and products. USPTO places patents having to do with human resource management, scheduling, accounting, and inventory monitoring in this group.

A Protection Racket -- The fifth and final group has to do with encryption and digital security. USPTO groups business cryptography here. When USPTO presents does their business methods presentations this group is not called out specifically as business methods patents but since it resides in Class 705 you need to view it as part of the business methods picture.