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Innovation is at the heart of the global economy.  Governments and corporations alike recognize innovation as a fundamental driver of economic and business growth. But recognizing shifting trends and emerging hot-spots is critical to understanding and channeling innovation to maximum effect. By dissecting innovation to its core components – the scientific research that informs initial discovery and the patents that protect and commercialize new ideas – we can begin to identify important trends that influence the future of the global economy.

As we approach the end of another year, it is timely to look back and reflect on the recent key highlights and trends in global innovation as represented in patents and identified by our dedicated team of IP analysts in Thomson Reuters IP & Science.

It turns out that we may well be at a turning point in global innovation. Two major studies recently conducted based on data up to the end of 2014 suggest that, although innovation continues to be a key driver of global economies and job creation, the pace and nature of that innovation is changing.

Latest State of Innovation

"The Future is Open: 2015 State of Innovation", an analysis of global scientific literature and patent data across 12 technology areas and released in May, gave the first clues that change is in the air.  Although the total worldwide volume of patents reached a record high, with over 2.1 million unique inventions published over the last year, year-on-year growth was just 3 percent, the slowest rate since the end of the global recession in 2009.

This trend was even more pronounced in the scientific literature with a decrease in total volume of new published scientific research of 34 percent over the same period.

The lifecycle of innovation may help to explain this. The discovery phase of the lifecycle of innovation happens before protection and commercialization through patenting, in a similar way, scientific research leads discovery. When we consider that scientific literature is generally accepted to precede patenting by approximately three-to-five years, the slowing of the patent growth rate should be expected due to the decline in scientific publishing.

But not just the rate of innovation is changing.  The nature of innovation is changing also. The 2015 study reveals significant industry and regional shifts, suggesting that "survival of the fittest" is now "survival of the broadest" as companies seek to expand their patent portfolios.

Although still a major sector of innovation, large declines in patent and scientific research volume were seen in the Semiconductor industry. Also, traditional boundaries between industries and companies’ areas of specialization have continued to blur.  Dozens of companies in the State of Innovation study, such as Apple, DuPont, General Electric, IBM and Samsung, appear among the top patent assignees in multiple industries outside of their core areas of focus.  Samsung is the most extreme example, ranking among the top 25 patent assignees in nine of the 12 industries analyzed in the study – and having patent activity in all 12 sectors, even if not in the top 25.

Global Top Innovator Trends

The second major study this year, the "Thomson Reuters 2015 Top 100 Global Innovators," supports and further illustrates these findings.  The report is based on an analysis of overall patent volume, patent-grant success rates, global reach and invention influence as evidenced by citations.

The shifting nature of innovation is reflected in the technology breakdown of the 100 companies on the list.  The Semiconductor sector continues to play a crucial role in digital development. However, having once dominated the list, growth in this area has dramatically slowed due to the utilization of new technologies to enhance the speed and functionality of computers.

An emerging area of innovation is in the category of Media Internet Search and Navigation. Amazon joined the ranks of Top 100 innovators for the first time, generating handfuls of new inventions each month in broad areas like data centers, devices and electronic methods and systems.

The study also shows the rise (or perhaps more aptly said: the metamorphosis) of the Chemical sector with double the number of companies on the list this year compared to last —the largest jump in the report—meeting demands in industries such as drug development, food chemistry and industrial solvents.

Oil and Gas, which wasn’t represented in 2014, made this year’s list for advancements in the hydraulic fracking of natural gas and expansion into alternative energy, as evidenced by Chevron, Exxon Mobil and Idemitsu Kosan.

The geographic landscape of innovation has, in contrast, remained relatively stable. Asia continues to lead the world in innovation with 44 organizations represented, but has lost market share to Europe, which has increased its presence to 20 from 18. France leads the European pack with 10 organizations. North America holds steady at 36, well below its 2011 peak of 46.

China is noticeably absent this year after making its first appearance in 2014. The nation continues to evolve its intellectual property infrastructure with record-breaking numbers of domestic patents, but further efforts to attain global patent protection will be essential to advancing its impact and influence within the innovation landscape.

It remains to be seen how the twin trends of slowing but increasingly cross-technology innovation will play out next year and in the years to come. Whatever the outcome, it remains certain that in today’s hypercompetitive global marketplace, innovation requires much more than having a great idea.  True innovation occurs when organizations harness the power of intellectual property rights and commercial insight to bring an idea to life.