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Cloud-centric IBM patents promise payoff

This blog post is part of our Essential Guide: IBM roadmap of cloud, AI-enabled IT drives Think conference

IBM plans to sow its latest crop of U.S. patents with a strong cloud emphasis, and prepare a feast for its hungry customers.

A substantial number of IBM patents for 2017 — more than 1900 out of 9043 total patents — were for cloud technologies, the company disclosed last month. Those numbers illustrate a clear shift in the company’s roadmap for products and services. In past years chip technology dominated IBM’s patent portfolio, which supported the bulk of the company’s business.

But IBM has pivoted to embrace the cloud as its foundational technology, and shored up its cloud presence through research and development. The company also received a substantial number of patents for AI (1,400 patents) and for security (1,200).

These thousands of cloud-centric patents is a competitive advantage for IBM because the cloud is the vehicle to deliver its strategic imperatives: Watson artificial intelligence technology, analytics, blockchain, cybersecurity, and other  areas such as microservices and serverless computing. For instance, two cloud projects that tap growing interest in serverless computing came out of IBM Research: IBM Cloud Functions, IBM’s serverless computing platform formerly known as OpenWhisk; and IBM Composer, a programming model to help developers build, manage, and scale serverless computing applications on IBM Cloud Functions.

“Many of these patents will be very useful in helping customers with cloud performance, integration and management of a multi-cloud environment,” said Judith Hurwitz, CEO of Hurwitz and Associates, Needham, MA. “Hybrid cloud management patents will be really important.”

Intelligence at the edge works with simpler predictive models and locally generated data to make real-time decisions, while cloud datacenters work with massive amounts of data to generate much deeper context, insight, and predictive models, said Paul Teich, an analyst with TIRIAS Research in Austin, Texas.

IBM also can extract value from new server, storage, and network technologies that underpin and improve cloud infrastructures, because cloud-based real-time assistance depends on affordable, reliable, and persistent network latency and bandwidth, Teich said.

“IBM is funding R&D work in all of those areas, as well as developing new algorithms to run on all that clever new hardware, which then enable new services based on their Watson software platform,” he said. “Complex neural network, neuromorphic, and eventually quantum computing accelerators for machine learning and artificial intelligence will live in the cloud for the foreseeable future.”

Turn research into real products

For customers, the increase in cloud patents indicates where IBM is putting R&D dollars. A growing chunk of IBM’s $6 billion annual spend on R&D has been on cloud research. And as AI and big data drive new demands for cloud, IBM has doubled down on cloud research areas such as infrastructure, containers, serverless computing and cloud security, said Jason McGee, IBM Fellow and VP, IBM Cloud.

For instance, ‘US Patent 9,755,923, “Predictive cloud provisioning based on human behaviors and heuristics,” describes ‘a system that monitors unstructured data sources such as news feeds, network traffic/statistics, weather reports and social networks to forecast cloud resource needs and pinpoint where to match increased demand.

But Big Blue must translate that R&D emphasis into compelling products and services. “Commercial relevance and immediate value is what matters, and there is no direct correlation that matters for CXOs’ purchasing decisions,” said Holger Mueller, an analyst with Constellation Research, San Francisco. Major IBM patents, such as relational database technology, happened decades ago, although in quantum computing IBM research is close to commercial viability and enterprise interest, he said.

IBM also can use its formidable patent portfolio as defensive or offensive weapons — keep the patents in-house to develop into products and services, or license them out for profit, said Frank Dzubeck, CEO of Communications Network Architects in Washington, DC. Companies with strong patent portfolios tend to strike up patent agreements with competitors or partners and allow them to license their patented technology. This also can discourage challenges from competitors who might claim they came up with an idea first.

IBM cloud competitors like Microsoft and Amazon have something to watch out for, because they might want to pay for the use of some of these things,” Dzubeck said.

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