IoT and the Fourth Industrial Revolution

The European Patent Office (EPO) recently published its observations related to the Fourth Industrial Revolution (4IR) from the perspective of patent activity. What becomes particularly apparent from the EPO’s report is the sheer scale of the Internet of Things (IoT) now and in the near future.

True to its name, the IoT involves basic technologies and applied solutions for connecting anything whatsoever wirelessly to the internet, which enables a high degree of automation and the large-scale collection of information as data. The things connected to the internet can be sensors or devices located practically anywhere. Thanks to remote control enabled by software and autonomy, the devices in question are often called intelligent devices or sensors.

As companies keep servitising and digitalising their operations to an increasing degree, the demand for IoT solutions keeps on growing. According to the EPO’s report, the IoT’s explosive growth into a large-scale ecosystem is aptly described by two estimates: the number of devices connected to the worldwide web is estimated to be roughly 26–30 billion by 2025, and the size of the data market is estimated to be more than EUR 1 billion in the EU area alone as early as by 2020.

The observations the EPO makes in its report on the basis of the activity of European patents also support the assessment that the Fourth Industrial Revolution is at hand:

1.    The patents related to 4IR applied for in 2016 numbered more than 5,000, of which a material proportion involved the connectivity of devices, but within which the most notable growth related to inventions involving artificial intelligence, 3D arrangements and user interfaces.  Based on these figures, the growth seems to be accelerating.

2.    A majority of the inventions still originate from Europe, the United States and Japan, but South Korea and China have been catching up with the leading countries at increasing speed.

3.    Of the European countries, German companies continue to apply for the most European patents (EP) with their 8 per cent share, followed by France, with its 6 per cent share. The focus of the German companies lies particularly in applications of the vehicle manufacturing industry, whereas French inventions concern artificial intelligence, encrypted communication, user interfaces and 3D systems. Finland’s contribution is also noteworthy, with a 2 per cent share of all 4IR-related patents applied for through the EPO.

4.    The most active companies are large ICT enterprises. However, numerous applications are also filed by smaller companies whose applications relate to the applied solutions.

The EPO’s report is available in full on its website.

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