Over the last few years, AI has evolved from an innovative add-on to a company’s processes to an integral part of how business works. With applications across industries as diverse as healthcare and travel and insurance, it’s no surprise that the global AI software market is set to hit $126 billion by 2025. Investing in such projects, however, calls for important conversations about how one can safeguard one’s intellectual property when developing AI assets, particularly through the securing of patents.

Importance of patents in AI

Recently, the office of the United States Trade Representative (USTR) released its 2024 report on IP rights, wherein it placed India on the Priority Watch List. This was on account of long-standing concerns about insufficient measures to enforce IP, including a high prevalence of online piracy and inadequate implementation of WIPO Internet Treaties. Evidently, India has much work to do as a country before its IP system can sufficiently incentivize continuing innovation — which, in fact, is critical to India’s growth as a leading economy.

In the AI context, particularly, patents are essential to safeguarding exclusivity in innovation. They grant companies a temporary monopoly over exploration and research in that specific subfield of AI applications, allowing them sufficient time to build the solution they seek and for investors to recoup their investment costs. In recent years, patents have enabled the development of critical AI applications across industries, such as ingestible sensors, traffic management systems, digital assistants, and autonomous vehicles.
Current landscape of AI patents

Globally, between 2000 and 2022, about 190,000 AI-related patents have been granted. Most of these were filed by tech giants such as Google, IBM, Microsoft, Intel, and Samsung. China and the USA are global leaders in AI patent applications, although India is fast catching up. Over the last decade, India has filed over 5000 patents, particularly as AI tech solutions proliferated during the pandemic. And 95% of the country’s AI patents have been filed in the last few years.

Role of patents in AI development

With AI’s capability for predicting behavior and recognizing patterns while learning on the go, it is a highly coveted asset when developing proprietary solutions. What a patent does is offer this technology legal protection as it is being commercialized, assuring investors that the technology cannot be duplicated and thus enabling more focused research, which in turn will help with wider market adoption. In particular, patents play a vital role in helping startups compete with big companies when it comes to innovation. By refining the scope of the patent they’re applying for through tailored semantic search, startups can claim exclusive rights much sooner and focus on refining their solutions.

As the market becomes more competitive and consumer demands skyrocket, AI will only become more invaluable to the building of smarter solutions. There will thus be a surge in demand for patents to safeguard AI IP — which calls for a more systematic approach to patent applications and protection. For instance, some have raised concerns about the cost-benefit analysis of patenting AI, given that technology is becoming outdated at a faster and faster rate. This can be addressed by offering better copyright and trade secret protections while the company assesses the long-term viability of the AI project and thus, whether it is worth patenting. As the India Budget announcement draws closer, the India Patent Office can consider investing in these processes, which will also fall in accordance with USTR’s points of recommendation for India on the 2024 report.

For the modern-day business, innovation is vital. And for AI innovations that have a large R&D component and long-term utility, getting IP protection is particularly vital so that competitors do not beat the company to the chase. Regardless of company size, therefore, it is vital to invest in the patent application process and safeguard one’s hard work. Going forward, we can expect to see further refinements to the patent laws to accommodate AI, as well as the defining of boundaries around the ethical use of AI in business applications. There is no doubt that AI is a reality — and businesses that adopt it now will be the ones leading the economy in the near future.

The author is Manish Sinha, Founder & CTO, PatSeer.

Disclaimer: The views expressed are solely of the author and ETCISO does not necessarily subscribe to it. ETCISO shall not be responsible for any damage caused to any person/organization directly or indirectly.