What are SVIX and RNIX?

Summary

With patent annuities sky rocketing into the hundreds of billions dollars over the next couple of years, Unified Patents has developed new tools that help companies make informed annuities decisions to their portfolio. The first tool being SaVe IndeX (SVIX) and the second being ReNew IndeX (RNIX). 

SVIX

SVIX analyzes over 70,000,000 million unique patent families that comprises of almost 150,000,000 million patents to determine how much annuities payments remain over the life of the patent family. SVIX is calculated by taking the total amount remaining for the annuity payment and normalizing that number by taking the (Cumulative Amount - Minimum Cumulative Amount) divided by the (Max Cumulative Amount - Minimum Cumulative Amount) multiplied by 100.

This allows SVIX to be on a scale between 1 and 100, where a higher SVIX score generally means a  higher payments are needed, while a lower index means the family is older and the annuities have been paid. All annuities payments are converted US dollar amounts, using the most up-to-date exchange rates. 

RNIX

Since RNIX encompasses analyzing the patent value versus the costs of patent fees remaining, the computation for RNIX is simply the difference between PVIX and SVIX (i.e., PVIX- SVIX= RNIX).  Because PVIX and SVIX are calculated on a patent family basis, not on an individual patent basis, the RNIX value will thus represent the Renewal Index for a specific patent family.  A negative RNIX means the costs still to be paid on renewal fees for that patent family (SVIX) is greater than the patent value of that family (PVIX).  A positive RNIX means that the patent value of that family (PVIX) is greater than the costs still to be paid on renewal fees for that patent family (SVIX).

RNIX in Action

Looking at the airline industry, both Airbus and Boeing have substantial patent portfolios with USD 397 million and USD 422 million, due in annuities respectively. Looking at the mean and each quartile of the RNIX score for the individual companies, the savings threshold can be analyzed.

Airbus

When looking at RNIX, versus the annuities owed, one can see logical saving points. For instance, an RNIX of -5 and 0 shows that there is a large amount of annuities owed. 

Looking at the number of patent families versus RNIX, it shows why there are certain spikes in respect to annuities owed. 

Using a quartile approach, natural saving cutoffs appear. For instance, at Quartile 1, with a RNIX score of 0, this would translate into USD 64 million in annuities owed, which would represent a 16% savings.

Taking this a step further, and using the publication date, Airbus seems to have older patents that are cost more to renew than actually bring value. Meanwhile, the newer publications tend to have an higher value. This would warrant a deeper examination of those patents that are mature and costing a great deal in annuities. 

Boeing

Looking at Boeing's patent portfolio, there is a great number of patent families with outstanding annuities below the 0 RNIX score, similar to Airbus. This means Boeing could reduce their annuities patents, by abandoning the patent or look for alternative ways to reduce their patent portfolio below this mark. 

Again, the spikes can be explain due to the number of patent.

Using a quartile approach, similar to Airbus, the savings breakdown can be seen below. 

Similar, to Airbus, looking at publication dates of 1996-2020, Boeing has a similar trend, where Boeing's older families encompass most of the annuities owed. 

Using RNIX, companies can now quickly understand the cost the annuities owed on their patent portfolio, but make data-driven decisions to understand what patents should be or should not be renewed.