Industrial Management & Data Systems

Examining technological innovation of Apple using patent analysis

Sunghae Jun Sang Sung Park

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Industrial Management & Data Systems, Vol. 113 Iss 6 pp. 890 - 907
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IMDS
113,6

Examining technological
innovation of Apple using
patent analysis

890

Sunghae Jun

Received 17 January 2013

Revised 20 March 2013
Accepted 22 March 2013

Department of Statistics, Cheongju University, Chungbuk, Korea, and

Sang Sung Park

Division of Information Management Engineering,
Korea University, Seoul, Korea

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Abstract
Purpose Apple is a representative company of technological innovation (TI) and management. It
has launched new and innovative products since 1977, and many companies and business schools
around the world have attempted to learn about the success story of Apples innovation. However,
most previous research works on Apples innovation have been based on qualitative approaches such
as experts opinions. Such studies offer a subjective point of view. By contrast, in this paper the
authors aim to study the TI and forecasting of Apple by analyzing its patent applications, which is an
objective approach to examining the innovation of Apple from a technological perspective.
Design/methodology/approach TI is an important issue concerning technology management for
companies and governments. To examine Apples TI, the authors analyze all applied patents and
construct analytical models according to three approaches. First, they build statistical models using
the time series regression and multiple linear regression methods to create a technology map. Second,
they cluster all Apples patents to find its vacant technology domain. Lastly, they use social network
analysis to search for technologies central to Apples future.
Findings The authors study shows the technological trends and relations between Apples
technologies. This research finds vacant technology areas and central technologies for Apples TI.
Practical implications Using statistical and machine learning methods, the authors analyze all
Apples patents in order to predict the firms future technologies. This research contributes to
examining the TI of Apple. Therefore, the results of the patent analysis can highlight the technological
opportunities for Apples TI.
Originality/value Traditional TI models have been based on qualitative methods. Previous
investigations of Apples TI have also relied on traditional analytical approaches. In this paper,
however, the authors develop a quantitative and objective approach for examining Apples TI.
Keywords Apple Inc, Technological innovation, Vacant and central technologies, Regression,
Patent clustering, Social network analysis, Innovation, Regression analysis, Patents, Social networks
Paper type Research paper

Industrial Management & Data

Systems
Vol. 113 No. 6, 2013
pp. 890-907
q Emerald Group Publishing Limited
0263-5577
DOI 10.1108/IMDS-01-2013-0032

1. Introduction
Most companies constantly strive for technological innovation (TI; Cesaratto et al.,
1991; Sun et al., 2008), which is not only important for creating competitive advantage
but also one of the strategies for generating sustainable development (Chen et al., 2007;
Sun et al., 2008; Trappey et al., 2012). Indeed, most successful businesses, including
Apple, aim for TI (Mann, 2003), and thus many companies and business schools have
attempted to learn about the success story of Apple from a management point of view.
The results of previous studies have mostly been based on qualitative methods.

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In other words, they have depended on the knowledge of experts. Thus, we need more
objective and verifiable approaches for examining Apples TI, because understanding
the state of TI in Apple is necessary for formulating R&D policies and creating new
products.
Previous research on TI has been based on simple visualizations such as graphs and
charts (Cesaratto et al., 1991; Sun et al., 2008; Trappey et al., 2012) or descriptive statistics
such as frequency, mean, and index values (Chen et al., 2007). Using these approaches,
however, limits our understanding of the TI of Apple because such simple analytical
methods are restrictive. Therefore, in this study we examine the TI of Apple using patent
analysis, because patents represent a major objective outcome of researched and
developed technology (Hunt et al., 2007; Roper et al., 2011). Specifically, we use statistical
methods and machine learning algorithms as quantitative methods in the presented
patent analysis ( Jun and Uhm, 2010).
In this paper, we propose three quantitative models for analyzing Apples patents.
First, we use time series regression and multiple linear regression models (Bowerman et al.,
2005) in order to construct a technology map of Apple. Second, we perform cluster analysis
(Jun et al., 2012) on the patent documents in order to predict Apples future technologies.
Lastly, we formulate the technology networks of Apples technologies using social
network analysis (SNA) methods (Butts, 2008; Jun, 2012). To provide novel knowledge on
Apples TI, we then combine the results of our proposed models. Therefore, our research is
a meaningful and objective approach to understanding Apples innovation. In summary,
this study analyzes Apples patents around the world in order to examine to Apples TI.
2. Research background
The performances of a considerable number of leading IT companies have recently
declined because they failed to adapt to changes over time and insisted on retaining
their traditional technologies. It is recognized that there is no permanently strong
company in the IT market. To survive in the competitive IT environment, a company
has to bring about technological development and innovate constantly. In 2012, Apple
and Samsung were growing consistently through new product development. However,
these firms also knew that their market shares could collapse at any time if their TI
stopped. After the death of Steve Jobs, the market assessment of Apple was relatively
poor. Apple was accused by Samsung of the infringement of its patent and its net
profits decreased. Now was the time to change the technological evolution of Apple.
3. Patent analysis for Apple
Traditional patent analysis approaches have mainly used citation information
(Fattori et al., 2003; Indukuri et al., 2008; Yoon and Park, 2007; Tseng et al., 2005,
2007). Recently, however, some research works have analyzed patent titles and abstracts
using text-mining techniques (Jun et al., 2010, 2012). In this paper, we use International
Patent Classification (IPC) codes as well as the title and abstract of patent as the input
data for the presented patent analysis. IPC codes provide a hierarchical structure of
patent classifications based on technological utility (IPC, 2012). Therefore, analyzing the
IPC code data extracted from Apples applied patents can allow us to understand its
technological change and make forecasts. Our analysis consists of three distinct
approaches, namely statistical analysis, patent clustering, and SNA. Figure 1 shows our
model for examining Apples TI.

Technological
innovation
of Apple
891

IMDS
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892

Figure 1.
Proposed analytical
process for examining
Apples patents

We retrieve documents on the applied patents of Apple from global patent databases
(USPTO, 2012). These documents provide diverse information such as patent title,
abstract, IPC code, application number and date, issue number and date, drawings,
claims, and so forth (Hunt et al., 2007). In this paper, text mining was used as a
preprocessing technique to extract the IPC codes and construct patent-term matrix from
the retrieved patent documents. In our text mining processing, we make text corpus
based on a collection of titles and abstracts in the patent documents. Next, we get a
structured text data by parsing from the text corpus, and we extract IPC codes from
the patent documents. So, we construct a patent-term-IPC code matrix as shown in
Figure 2.
The row and column of this matrix represent patent and term or IPC code,
respectively. Each element is a frequency of term or IPC code in each patent. For
example, freqP1T2 is the frequency of term2 in patent1. In this paper, we build analytical
models for examining Apples TI using our structured patent-term-IPC code matrix by
text mining technique.
As shown in Figure 1, our proposed model consists of three approaches. First, we
perform a statistical analysis in order to summarize Apples patent data and construct
a time series regression model to ascertain its technological trends over time. This
analysis allows us to understand Apples speed of technological development and to
find its so-called target technologies as well as those technologies that influence them.

Figure 2.
Patent-term-IPC
code matrix

Second, we cluster the patent data. By using the Silhouette width approach (Rousseeuw,
1987; Everitt et al., 2001), we determine the optimal number of clusters (K) and use the K
for the K-mean clustering algorithm (Han and Kamber, 2005; Hastie et al., 2001). Patent
clustering makes it possible to predict vacant areas of Apples TI. Further, the result of
this patent clustering is used as the input data for the SNA approach. Lastly, we apply
SNA techniques (Cho et al., 2012; Sternitzke et al., 2008) in order to ascertain the elaborate
relations between Apples technologies. To this end, we construct advanced SNA graphs
to draw associations between Apples representative technologies and its technological
groups. Next, we explain these three approaches in detail.

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3.1 Statistical analysis

To understand Apples technologies, we apply a time series regression model
(Bowerman et al., 2005) to assess the number of applied patents by year as follows:
y t b0 b1 t 1 t

where yt is the number of applied patents in year t, b0 and b1 are the intercept and slope
of the trend in year t, respectively, and 1t is the error term in year t. This is a trend
model of Apples developed technologies. The slope value of this model shows the
development speed of the firms target technologies. For example, the trend of the IPC
code H04M by year is represented as follows:
IPC b0 b1 year

The larger the value of b1, the more the trend increases. In this paper, we select the
important technologies according to b1 of Apples IPC codes and measure the model
utility using the adjusted multiple coefficient of determination (adj. R 2 )
(Bowerman et al., 2005; Han and Kamber, 2005). If adj. R 2 is 1, then the model
utility is perfect. After selecting the meaningful IPC codes using the time series
regression model, we use a multiple linear regression model (Bowerman et al., 2005) to
build a technology map of Apple as follows:
IPC T b0 b1 IPC 1 b2 IPC 2 bk IPC k 1

where IPCT is the target IPC code (i.e. the dependent variable in the multiple regression)
and IPCi is the ith input IPC code (independent variable). The technological development
of the target IPC code is affected by the development of the technologies based on input
IPC codes. b0 is the intercept and the mean value of IPCT when all input IPC codes equal
0. bi is the slope and the increased change in the mean value of IPCT associated with a
unit increase in IPCi. If bi is negative, the mean value of IPCT decreases as IPCi increases.
Moreover, this research carries out t-tests (Ross, 1996) to assess the significance of the
parameter bi. The null and alternative hypotheses are as follows:
H 0 : bi 0

vs

H 1 : bi 0

The null hypothesis H0 states that the parameter of IPCi is not significant, while the
alternative hypothesis H1 represents the statistical significance of the parameter. Using
the p-value (probability value) (Ross, 1996) derived from the results of the t-tests, we can
support H0 or H1. If the value is smaller than 0.05 (i.e. 95 percent confidence interval),
we reject H0 and support H1. This means that bi is statistically significant.

Technological
innovation
of Apple
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IMDS
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894

Therefore, we can explain the technological development of IPCT by the technological

development of IPCi. Using the significant input IPC codes, we thus construct a
technology map for the target IPC code. Figure 3 proposes an example of the structure of
our technology map.
We find that the technological development of the target IPC code (IPCT) is affected
by the technological developments of IPCi and IPCj. Further, IPCi and IPCj are
influenced by IPCk and IPCp, respectively. For example, the technological development
of IPCi affects the target technology IPCT by the weight of bi, and IPCk influences the
development of IPCT technology by the value of bk*bi. Therefore, we can construct the
technology map of Apple using the result of our statistical analysis of Apples patents.
3.2 Patent clustering
In the next step, we carry out a cluster analysis of the patent data to understand the
technological distribution and ascertain vacant technology areas. As noted earlier, we
preprocess the retrieved patent documents using text mining (Tseng et al., 2005, 2007).
Our clustering uses the textual data such as patent title and abstract from the patent
documents. Figure 4 shows the patent clustering process.
Before data clustering, we have to determine the optimal number of
clusters (Han and Kamber, 2005). Choosing the number of clusters is crucial for
clustering in order to avoid distorted information (Everitt et al., 2001; Han and
Kamber, 2005). Generally, this choice depends on the investigators experience and thus

Figure 3.
Proposed structure
of our technology map

Figure 4.
Proposed patent
clustering process

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it is a subjective approach. However, many objective methods for choosing the number of
clusters have been suggested (Everitt et al., 2001).
In this paper, we consider the Silhouette width to be a measure of the number of clusters
(Rousseeuw, 1987). In previous works on patent clustering, this measure has shown good
performance (Jun and Uhm, 2010; Jun et al., 2012). This method measures the standardized
difference between objects by taking the average distance of an object from all others in its
cluster and in the nearest cluster (Everitt et al., 2001). Based on this approach, we choose
the optimal number of clusters when the Silhouette width is the largest. Then, we perform
patent data clustering using the K-means algorithm, where K is the number of clusters
chosen by the Silhouette measure. This algorithm starts from an initial K clusters and
uses the Euclidean distance between objects and clusters during given iterations. When
the change from objects to clusters is hardly shown, the clustering iteration is stopped.
To ascertain the vacant or undeveloped technologies of Apple, we thus extract the top ten
IPC codes from K clusters in order to predict the firms vacant technology.

Technological
innovation
of Apple
895

3.3 Social network analysis

SNA is a method for analyzing the relations between objects in a social system (Butts,
2008; Cho et al., 2012). By using SNA ( Jun, 2012), we can take a network structure of
IPC codes and find the central IPC code in the social technology system. In addition, we
can understand the mutual relations between IPC codes. Figure 5 shows our SNA
process for analyzing Apples patents.
From the result of our patent clustering analysis, we extract IPC codes in order to
construct an IPC code-cluster matrix (ICM). Our ICM consists of clusters and their
included IPC codes. We use this ICM to make five SNA graphs: an SNA graph of IPC
codes and clusters, a cluster-SNA graph, an IPC code-SNA graph, a cluster-SNA graph
based on mutual information, and an IPC code-SNA graph based on mutual information.
These graphs illustrate the technological relations between Apples IPC codes.
4. Results
To verify the performance of the proposed model for examining Apples TI, we used the
documents of all the patents applied for by Apple. We retrieved patent data in July 2012

Figure 5.
Proposed SNA process

IMDS
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896

from the US patent databases (USPTO, 2012). Also, we got global patents of Apple via a
paid service (WIPSON, 2012). Specifically, we searched for patent documents assigned
to Apple because we focused on the technologies from the inside of Apple for examining
Apples TI. In this paper, we constructed our patent data by combining the searched
results from USPTO and WIPSON, and removing the duplicated and non-validated
patents. For our experiment, the total number of Apple patents was 8,119 from the period
1977 to 2012. They covered all patents of Apple including applied and utility patents.
Figure 6 shows the number of applied patents by year.
In Figure 6, we omitted the patents of 2011 and 2012 because our data retrieval did
not go through until 2012, while many 2011 patents have not yet been registered in
patent databases. The first peak in Apple patents was in 1995 (n 346). In the early to
mid-1990s, Apple researched and developed new computer-related items such as the
Power Macintosh based on the PowerPC processor of IBM. Since these glory days,
Apple has faced some difficulties. New challengers such as IBM and Microsoft have
threatened its business by providing competitive products such as cheap hardware and
imitated graphic user interface (GUI) systems. These were Apples anchor products.
Thus, the competitive position of Apple weakened in the market, which caused its
R&D activities to shrink (see the decrease in patents in the late 1990s).
In the early 2000s, Apple became interested in user experience (UX) design, which
aims to construct models for explaining all aspects of human-system experiences
including products and services. In 2001, the firm introduced the iPod (a portable
media player) into the market, with iTunes following thereafter. This was a signal of
Apples revival. Since then, its number of patents has increased dramatically (including
the iPhone and Apple TV). To ascertain the share of technological patents to total
patents, we tabulated the representative IPC codes of patents. The representative IPC
code is the main IPC code in each patent. We removed patents lacking representative
IPC codes.
1,200

1,000

800

600

400

200

0
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010

Figure 6.
Number of Apple
patents by year

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Table I shows the technological dispersion of Apple patents. We found that all Apple
patents were based on 164 IPC codes, while the IPC code of G06F accounted for 46 percent
of all Apple patents. G06F is represented by the technology domain of electric digital
data processing. In other words, many of Apples technologies depend on this
technology domain. The second largest IPC code was G09G which is arrangements or
circuits for the control of indicating devices using static means to present variable
information, while the third was H04N, or pictorial communication, e.g. television.
In conclusion, most Apple technologies focus on the domain of digital information
control and television. Next, we analyze the number of patents that have G06F, G09G,
and H04N codes.
Figure 7 shows that the trend of G06F codes by year is similar to that for the total
number of Apple patents. The trajectory of G06F technology increased rapidly from
2004 to 2007 before slowing.
Figure 8 shows the numbers of the second to sixth most frequent IPC codes, namely
G09G, H04N, G06K, H05K, and H04L. Again, we found that the time series data of these
IPC
G06F
G09G
H04N
G06K
H05K
H04L
G06T
H01R
H04B
G10L
H04M
G06Q
H04R
G11C
H03M
H04W
H01Q
H01H
G08B
H02J
H03K
G01R
G10H
H04J
G11B
G01C
H03G
G02F
H01M
H04Q
F21V
H01L
H01J

Frequency

IPC

Frequency

IPC

Frequency

IPC

Frequency

IPC

Frequency

3,337
542
365
242
233
196
195
189
138
127
99
91
76
75
67
66
60
57
56
55
48
42
42
41
38
37
33
31
30
26
24
21
20

G03B
H05B
B65D
H01F
G05B
H04H
G05F
H02M
A61B
B32B
G01J
A47B
G08C
G02B
G09B
H01B
A63B
B29C
B41J
H03B
G01P
H03L
A63F
E05C
H03F
B23P
H02H
H03D
G01L
G01N
G01S
G09F
H04K

19
19
18
18
17
16
15
15
14
14
14
13
13
12
12
12
11
11
11
11
10
10
8
8
8
7
7
7
6
6
6
6
6

A47G
E05D
G01D
G05D
H02G
B24B
F16M
G06N
A61M
B41B
E05F
F16L
G01B
G01K
G04B
G04G
G10K
H01P
H04S
A01H
A01K
A41D
A45C
A47F
A63H
B44C
B65B
B65H
C23C
C25D
E04B
E05B
E06B

5
5
5
5
5
4
4
4
3
3
3
3
3
3
3
3
3
3
3
2
2
2
2
2
2
2
2
2
2
2
2
2
2

F28D
G01F
G01H
G06E
G06G
G07F
H02B
H02K
H02N
H04C
A24F
A41J
A44B
A61K
A61N
B06F
B08B
B21C
B21D
B22D
B23K
B25B
B28B
B29D
B41F
B42D
C03C
C06F
C06K
C07D
C08K
C11D
C12N

2
2
2
2
2
2
2
2
2
2
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1

C12P
C22B
C23F
E04C
E04F
E05G
E21B
F01D
F04D
F16H
F21S
F25B
F26B
F28F
G00F
G03C
G03F
G03G
G04F
G06H
G06I
G07G
G08F
G60F
H01C
H01T
H03C
H03H
H05F
H05H
H10R
J06K
Total

1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
7,252

Technological
innovation
of Apple
897

Table I.
Representative IPC
code frequencies

IMDS
113,6

450
400
350
300

898

250
200
150
100

1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010

90
80
70
60
G09G (2nd)

50

H04N (3rd)

40

G06K (4th)
H05K (5th)

30

H04L (6th)

20

Figure 8.
Numbers of the second to
sixth most frequent IPC
codes by year

10
0
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010

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50

Figure 7.
Number of G06F
IPC codes by year

codes had a cyclic linear trend. In terms of the next most frequent codes, Figure 9 confirms
that G06T, or image data processing or generation, has increased recently. This implies
that Apple has developed many image processing technologies in recent years.
According to Table II, the top ranked IPC codes of Apple showed few changes
throughout the 2000s. This finding suggests that the firms major technologies have
not changed in the past decade.
Next, we constructed a technology map using time series regression and multiple linear
regression models. In this experiment, we used the following 11 top ranked IPC codes as
follows: G06F (1st), G09G (2nd), H04N (3rd), G06K (4th), H05K (5th), H04L (6th), G06T (7th),
H01R (8th), H04B (9th), G10L (10th), and H04M (11th). First, we used the time series
regression model to select the IPC code of the target technology. In this regression, the
independent variable was time (year). Then, we constructed 11 regression models according
to the 11 top ranked IPC codes. Figure 10 shows the slope (b1) values of these 11 IPC codes.

Technological
innovation
of Apple

35
30
25
G06T (7th)

20

899

H01R (8th)

15

H04B (9th)
G10L (10th)

10

H04M (11th)

Figure 9.
Numbers of the seventh to
eleventh most frequent
IPC codes by year

0
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010

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Year

Top ranked IPC code

1st

2nd

3rd

2010
2009
2008

4th

5th

6th

7th

8th

G06K

G06T

H05K

H01R

H04L

G06T, H04L

9th

H04B
G10L

G11C
H03M

H01R

G06K, H05K

G06K

H05K

G06T

H04L

H01R

H04M

G10L

H04B

H05K

G06T

H01R

G06K

G10L
H04M

H04N
2007

H04L

G09G
2006
2005

G06Q, H05K
G06K

G06F

H05K

2004

H01R

2003

G06T

G06K, H04B, H04N

H04Q

H04B
H04R

G01C, G06K, G06T

H01R, H04B

H05K

2001

H04N H05K

2000

G09G

H04L

G06T

G09G, H04L
H04N

G06K

G11C

G10H, G10L, H01R,

H04W
H05K

H04M

G06T

H04L

H05K

H01H

H04N
2002

10th

G10L, H01R, H02J

G11C,
H04L

G06Q, G10L, H01R, H03M

G01R, G06K, H05K

G06Q, G06T, G08B

G10H, H01L, H01R

Table II.
Top ten IPC codes
in the 2000s

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900

Figure 10.
Slope (b1) values of the
time series regression
model by IPC code

The slope value represents the influence of each IPC code. Because G06F has the
largest b1 values, we selected this IPC code as Apples target technology. Figure 11
shows the adjusted R 2 values of the regression model by IPC code.
Again, the value of G06F was the largest. Therefore, we concluded that G06F was
the representative IPC code of all Apples technologies and used it as the dependent
variable. Using the results from the time series regression model, we then built a
technology map of Apple using the multiple linear regression model. Table III shows
the first results of the multiple linear regression model.
Table III shows which codes influenced the dependent variable of G06F. Those IPC
codes that have a p-value less than 0.05 are considered to affect the technology domain
of G06F. The IPC codes of G09G, H04N, and G10L had a statistically significant
influence on the development of G06F. The connecting weights to G06F were the

Figure 11.
Adjusted R 2 values of the
time series regression
model by IPC code

regression parameters (b1). These parameters represent the increase in G06F associated
with a one-unit rise in G09G, H04N, and G10L. Of these codes, G10L has the largest
influence on G06F because the parameter of G10L is the largest. To complete Apples
technology map, we thus performed a second multiple linear regression (Table IV).
In this case, we found three dependent variables, namely G09G, H04N, and G10L.
These dependent variables were thus used as independent variables in the first case.

Dependent code

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G06F

Dependent code
G09G

H04N

G10L

Independent code

Parameter (b1)

p-value

G09G (2nd)
H04N (3rd)
G06K (4th)
H05K (5th)
H04L (6th)
G06T (7th)
H01R (8th)
H04B (9th)
G10L (10th)
H04M (11th)

1.36
4.12
0.61
21.25
0.55
21.47
1.39
20.67
7.81
20.22

0.007
0.001
0.655
0.473
0.645
0.308
0.312
0.679
0.001
0.898

Independent code

Parameter (b1)

p-value

H04N (3rd)
G06K (4th)
H05K (5th)
H04L (6th)
G06T (7th)
H01R (8th)
H04B (9th)
G10L (10th)
H04M (11th)
G06K (4th)
H05K (5th)
H04L (6th)
G06T (7th)
H01R (8th)
H04B (9th)
G10L (10th)
H04M (11th)
G09G (2nd)
H04M (11th)
G09G (2nd)
H04N (3rd)
G06K (4th)
H05K (5th)
H04L (6th)
G06T (7th)
H01R (8th)
H04B (9th)

1.43
1.42
21.74
0.82
20.80
20.14
0.42
0.06
0.27
20.31
0.91
0.10
0.30
20.13
0.37
0.21
20.41
0.24
0.10
0.00
0.07
20.08
0.14
0.03
0.29
0.11
0.04

0.002
0.011
0.016
0.111
0.200
0.814
0.553
0.945
0.716
0.199
0.001
0.628
0.233
0.585
0.194
0.556
0.162
0.002
0.581
0.945
0.556
0.574
0.420
0.815
0.043
0.425
0.809

Technological
innovation
of Apple
901

Table III.
First results of
the multiple linear
regression model

Table IV.
Second results
of the multiple linear
regression model

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902

Figure 12.
Apples final
technology map

Figure 13.
Silhouette width by
number of clusters

From the first result, we already knew that the IPC codes of G06K, H05K, and H04N
affected the development of G09G. Further, we found that H05K and G06T influence
H04N and G10L, respectively. From the results of the first and second models, we
therefore constructed the final technology map for examining Apples TI (Figure 12).
From Figure 12, we conclude that Apples most fundamental technology is the
technology domain of G06F. However, the technological paths of Apple can also be
explained by the technology map. For example, G06K affects G09G by a weight of 1.4246,
while G09G influences G06F by a weight of 1.3638. Further, G06K affects G06F through
G09G by a weight of 1.4246*1.3638. The remaining paths can also be described in this way.
Moreover, we can determine the number of clusters with the largest Silhouette value.
According to the results shown in Figure 13, the number was five. Using this result, we
performed K-means clustering with K 5. Table V shows the clustering results.
Because most patents were in cluster 1, the technology of cluster 1 cannot become the
vacant field of Apples TI. Cluster 3 also has several patents, whereas clusters 2 and 5 have
relatively few patents. Hence, we considered these two clusters to be Apples vacant
technology areas. Table VI shows the representative IPC codes of these five clusters. The
IPC codes of G06F, H04B, and H04N are included in all clusters. This means that most
technologies of Apple are based on the technologies of G06F, H04B, and H04N IPC codes.

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The defined technologies of G06F, H04B, and H04N are electric digital data processing,
transmission, and pictorial communication, e. g. television, respectively. We knew most
of Apples patents were developed by the technologies of these codes. They are hardly
conductive to separate out their detailed technologies from the five clusters. So, we did not
use them to characterize each cluster. The IPC codes of H04R, G10H, H03G, and H02B are
used to separate cluster 5 from the others because these codes are in this cluster exclusively.
According to the results of our patent clustering, we can thus define cluster 5 as the vacant
technology area for examining Apples TI according to the World Intellectual Property
Organization (IPC, 2012). The defined technologies include the communication and
processing technologies of electronic music and speech. Therefore, Apple needs to develop
these technologies relatively more than it does the others (Table VI).
The final approach in the presented analysis was the construction of SNA graphs.
Using the results from the patent clustering, we built different SNA graphs for examining
Apples TI based on the ICM. The row and column of ICM represent the IPC code and
cluster, respectively, and an element of this matrix has binary value. When the value is
one, the technological relationship between the IPC code and the cluster is existed. Using
the binary nature of the ICM, we can check whether an IPC code occurs in each cluster. In
other words, if the value is 1, then the IPC code occurred in the cluster and 0 otherwise.
Figure 14 shows which IPC codes are associated with which technology clusters.
The IPC codes that connect to clusters relatively more frequently represent meaningful

Technological
innovation
of Apple
903

Number of
patents

5,852
351
1,071
676
169

72.08
4.32
13.19
8.33
2.08

Table V.
K-means clustering
results

Electric digital data processing

Speech analysis or synthesis; speech recognition; audio analysis or processing
Pictorial communication, e. g. television
Electrically-conductive connections; structural associations of a plurality of mutuallyinsulated electrical connecting elements; coupling devices; current collectors
H04R Loudspeakers, microphones, gramophone pick-ups or like acoustic electromechanical
transducers; deaf-aid sets; public address systems
G10H Electrophonic musical instruments; instruments in which the tones are generated by
electromechanical means or electronic generators, or in which the tones are synthesized from a
data store
H04M Telephonic communication
H04B Transmission
H03G Control of amplification
H02B Boards, substations, or switching arrangements for the supply or distribution of electric
power

Table VI.
Defined technologies of
the IPC codes in cluster 5

Cluster Representative IPC codes

1
2
3
4
5

G06F, G09G, H04N, H05K, G06K, H01R, H04L, G06T, H04B, H04M
G06F, G06Q, G11B, H04N, H04B, H04H, G09G, H03G, G10L, H01R
G06F, G09G, H04N, G06T, G06K, H04L, G10L, H01R, H02J, H04B
G06F, H04N, G09G, H04L, H03M, G06K, H04B, G11C, G06T, H04J
G06F, G10L, H04N, H01R, H04R, G10H, H04M, H04B, H03G, H02B

IPC
code

Defined technologies

G06F
G10L
H04N
H01R

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904

Figure 14.
SNA graph of IPC
codes and clusters

technologies for Apple. We can see that the IPC codes of G06F, G06T, G09G, H01R,
H04H, H04L, and H04N are connected to most clusters. Therefore, these are Apples
meaningful technologies. Next, we formulated an SNA graph between clusters to
understand the central technology of Apple (Figure 15).
Clusters 1 and 3 are defined as the central technologies of Apple because they have
four connecting paths (the largest number). Similar to the technology that defines
Apples vacant technology (Table VI), we defined the representative technologies of
clusters 1 and 3. These clusters have the same IPC codes, namely G06F, G09G, H04N,
G06K, H01R, H04L, G06T, and H04B. These are thus common technologies between
clusters 1 and 3. However, cluster 1 also has the H05K and H04M codes, while cluster 3
also has G10L and H02J. Therefore, we define the technology of cluster 1 as the
technologies of digital image data controls such as transmission, communication,

Figure 15.
Cluster-SNA graph for
finding Apples central
technology

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recognition, presentation, and arrangement. In addition, cluster 2 was defined as the

technology of digital audio data controls such as analysis transmission, communication,
recognition, and arrangement. The representative technologies of clusters 1 and 3 are
based on image and audio,, respectively. The integrated technology of clusters 1 and
3 can be defined as the technologies of digitalized video data handling. The final SNA
graph is the cluster-SNA graph based on mutual information, as shown in Figure 16.
The thickness of the connecting lines denotes the association weight between two
clusters. Clusters 1, 3, and 4 are interconnected strongly. Figure 15 showed that clusters
1 and 3 were the central technologies of Apple. Further, we can confirm that cluster 5 is
weakly connected to clusters 1, 2, and 3 (the technology of cluster 5 was the undeveloped
vacant technology according to the result of Table VI). Therefore, we can conclude that
our previous results are valid.

Technological
innovation
of Apple
905

5. Conclusions
This paper examined Apples applied patents by using three analytical models for the
presented patent analysis. They performed independently of each other. First, statistical
methods of time series and multiple regressions were applied to create a map of
technological relationship. The p-value was used to select the meaningful IPC codes
(technologies) and the regression parameters represented the associated weights between
technologies. Using this result, we found the G06F code to be the target technology of
Apple and the IPC codes of G09G, H04N, G10L, G06K, H05K, and G06T as those that
influenced G06F directly and indirectly. Second, Using cluster analysis, we grouped the
technologies of Apple to homogeneous clusters. From the clustering results, we selected
undeveloped and vacant areas of Apples technologies and found that the communication
and processing technologies of electronic music and speech were the vacant areas for
Apples TI. Lastly, we built three SNA graphs to ascertain the relations between clusters
and IPC codes and found the central technologies as well as checked the undeveloped and
vacant technology in Apple uncovered earlier. So, we found technological impact and
forecasting of Apple by combining the results of the three approaches.
Although traditional TI has been based on creative analyses, we focused on the
analysis of the developed technologies of Apple based on its applied patents in order to
examine its TI. It is important that the TI of Apple inspires creative designers.

Figure 16.
Cluster-SNA graph based
on mutual information

IMDS
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906

This research contributes to examining the TI of Apple objectively. In our study, we

used the class level of IPC code (e.g. G06F, H05K) as the data input for the patent
analysis. However, if the group level of IPC code (e.g. G06F 3/100, H05K 3/02) were
analyzed, we may ascertain more detailed results. Further, more advanced statistical
methods for the patent analysis can be considered to be a novel result for examining
Apples TI. These advances will be furthered in our future works. In addition, we will
compare the TIs of Apple and Samsung by analyzing their patent data.
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Corresponding author
Sang Sung Park can be contacted at: hanyul@korea.ac.kr

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907

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