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IBM spinoff takes global view of patents

Delphion says the licensing agreement will open up its entire database, including U.S. and European patent information, to Japanese corporations.

IBM patent research spinoff Delphion said it is licensing its software to Patolis, formerly the Japanese Patent Information Organization.

Delphion said Patolis, which became a private company last year, will use its technology to expand its online patent information service, dubbed Patolis-Web. Prior to the deal, Japanese corporations only had access to Delphion's Japanese patent data. Through the new agreement, they will have full access to Delphion's database, including U.S. and European patent and intellectual property information.

The announcement comes as companies are increasingly conducting Web patent search information as part of their business strategies to identify their competitors. At the same time, companies are filing more patent applications to protect their valuable innovations. The U.S. Patent and Trademark Office (PTO) says IBM received 3,411 patents in 2001--more than any other corporation for the ninth year in a row. NEC followed with 1,953, Canon with 1,877, Micron Technology with 1,643 and Samsung Electronics with 1,450.

Owen Seitel, a partner at the law firm Idell, Berman & Seitel, said software technology has dramatically eased patent research. In the old days, he said, "you almost had to get a hotel room in Washington, D.C., so that you could get up in the morning and go to the PTO and rummage through the files."

He said the PTO is already digitally encoding a lot of their files, creating significant access and, as a result, opening up new business opportunities for companies.

Patent search technology "levels the playing field for a lot of people," Seitel said. "Now the little guy in the garage in Menlo Park can have the same information at his disposal that IBM does--and that's tremendously liberating."

Although Delphion is aiming to be the center of intellectual asset management, the company is not alone. Dialog, a subsidiary of The Thomson Corporation and Information Holdings, also compete in this market. Still, Delphion, which is funded by the Internet Capital Group, is aiming to positioning itself to take advantage of the needs of companies to research patent data. Delphion's customers include Exxon Mobil, Kraft and Texas Instruments.

"The biggest thing coming now in corporations is really how to handle intellectual property," said Woody Ritchey, chief executive of Delphion. Patents hold "intrinsic value. It has grown significantly in the last 15 or 20's the intellectual capital of a corporation."