Annuity Services - Market Size
Using publicly available information, we have estimated the global market size for the annuity services industry to be between $1.207 billion and $1.42 billion annually. Since many of the companies in this industry are private, revenue data is limited. Also, data on the fees charged by annuity service providers was scarce. Therefore, the market size should be considered a conservative estimation.
MARKET SIZE BASED ON NUMBER OF IN-FORCE PATENTS AND ANNUITY SERVICE FEES
According to the WIPO Statistics Database, there are about 50 million IP rights in force, as of 2016. Of these, 10.6 million are patents.
For additional context, there were 2,888,800 global patent applications in 2016, with the following breakdown by country:
Republic of Korea: 7.45%
European Patent Office: 5.5%
Patent renewals vary by country with some having annual renewals and others being more periodic. In the US, patent renewals happen every 3.5, 7.5, and 11.5 years from when the patent was granted. So, this inconsistency also factors into the difficulty in triangulating the market size.
A video by Dennemeyer dissecting the invoice of a competitor suggests that company charged a fee of $133.67 per annuity. While this number may be skewed by the sales tactic of Dennemeyer, it was the only solid figure I could find after an extensive search. So, I will use it as a proxy figure to provide a rough market calculation.
If each of the 10.6 million in-force patents is renewed annually, the total market for patent renewals would be $1.42 billion (10.5 million x 133.67).
MARKET SIZE BASED ON PATENT ANNUITY SERVICE COMPANY REVENUES
Using this list of the top patent annuity service providers, I have searched for data regarding their revenue to attempt a rough market calculation. As many companies are privately held, revenue data is limited.
According to CPA Global's 2016 annual report, they handle over 1.7 million patent renewals annually and serve 80% of the top global patent filers. As a private company, CPA's annual report does not provide revenue data. However, business aggregator Owler puts CPA's estimated revenue at $15 million.
Dennemeyer & Associates
Delegate — Valipat and Envoy merger
In 2016, Valipat and Envoy merged. The new company boasts more than 50,000 annual IP annuities and renewals. In 2017, they rebranded as Delegate, a privately-held company. While I found no revenue data for the newly-formed company, Valipat had estimated revenue of $33.69 million. I was unable to find revenue data for Envoy.
Privately-held MaxVal, based in Los Altos, CA, has estimated revenue of $9 million. Its Annuity Payer™ product is designed to make patent renewals simpler, though pricing is not publicly available.
In 2016, Thomas Reuters sold its intellectual property division to two private equity firms, Onex Corp OCX.TO and Baring Private Equity Asia, for $3.55 billion. However, in 2015, its IP division accounted for $1.005 billion, down from $1.011 billion in 2014.
Using these companies as a proxy for the whole industry, their total company revenues come to $1.207 billion. This figure uses the 2015 Thomas Reuters revenue figure.
In conclusion, the global market size for the annuity services industry is conservatively estimated to be between $1.207 billion and $1.42 billion annually.