While many of Amazon's thousands of patents may never come to fruition, experts say that Amazon has very notable successes in terms of developing and protecting core patented technology.
For example, long before cloud computing was a mainstream enterprise practice -- and long before Google or Microsoft entered the space -- Amazon was getting patents issued relating to advanced cloud management and deployment.
"That strategy very much empowered their business strategy to allow them to have a huge lead in cloud," says David Pratt, Managing Director at MCAM. "In turn," he says, "it made it more complex and costly for competitors to stand up their cloud capability." Amazon's cloud unit, AWS, is now the company's most profitable business.
Amazon's patent for one-click shopping, which lets customers buy things without entering and re-entering their billing, payment or shipping information, was issued in 1999. That patent gave it an edge over other retailers and reaped dividends through licensing fees from the likes of Apple and others. It expired last year, but for nearly 20 years, Amazon was the only game in town for a technology many consumers now take for granted.
Gaston Kroub, a founding partner at IP litigation boutique Kroub, Silbersher & Kolmykov, says that Amazon "struck gold" with one-click by getting a seminal ecommerce patent. With cloud computing, he says Amazon got in early "in what proved to be a very important business unit and that gave them a competitive advantage.
To date Amazon has over 6,100 patents issued by the U.S., Europe and World Intellectual Property Organization. But in the business of patents, experts say it's not about numbers, but having the best quality patents that aim to enable and extend a company's business model. And in that regard, Pratt says, Amazon has one of the richest patent portfolios among the Fortune 500.
Kroub says that while Bezos has been proactive and smart about getting patents, part of his success comes from the era in which the company grew up.
"It helped that Amazon came of age at a time when there was a real land rush to patent technologies around software and business practices," Kroub says. "During the dotcom boom, there was a huge rush in the patent office to grab as many as possible. Amazon was part of that wave and developed good habits on the patent front."