Networks and Collaboration4.1 Innovation Connections
4.1.1 Businesses collaborating for the purpose of innovation
The extent to which innovation-active businesses collaborate on innovation provides a measure of connectedness between different parts of the innovation system. Collaboration is any arrangement where organisations work together for mutual benefit and share some of the technical and commercial risks. It explicitly excludes fee for service and franchise arrangements. As such, collaboration involves a degree of trust and interdependence. In 2019–20, the share of innovation-active businesses that collaborated for the purpose of innovation was 20.8 per cent. This represents a sharp increase from the previous year when only 14.1 per cent of businesses reported collaborating on innovation. Medium-sized businesses (with 20–199 employees) reported a higher proportion of collaboration on innovation than other businesses. By far the most collaborative industries (data not shown) were Arts and recreation services (31.9 per cent) and Information, media and telecommunications (29.6 per cent), whilst the lowest level of collaboration was reported for Agriculture, forestry and fishing (16.1 per cent).[109]
4.1.2 Businesses collaborating on innovation
The majority of collaboration on innovation by Australian businesses occurs domestically – most commonly with customers or suppliers (data not shown). Importantly, around a quarter of innovation-active businesses that collaborate on innovation, collaborate with another business owned by the same company and operating in Australia (22.4 per cent in 2018–19). This provides a rough indication of the innovation capability embedded within businesses. In 2018–19 only 9.8 per cent reported collaborating on innovation with Australian universities or other higher education institutions. This though is a sizeable increase from the 4.8 per cent reported in both 2014–15 and 2016–17. Partnership arrangements require trust between the business enterprise sector and higher education researchers. International collaboration on innovation occurs at an even lower rate, with just 0.9 per cent of innovation-active businesses collaborating with an overseas higher education institution in 2018–19.[110]
4.1.3 Businesses collaborating on R&D
A modest subset of innovation-active businesses undertake research and development (R&D). Survey evidence suggests that Australian innovation-active businesses report relatively low rates of collaboration on R&D. In 2018–19, only 3.3 per cent of Australia's innovation-active businesses collaborated on R&D, which is the lowest proportion since 2005–06. By business size (data not shown), large innovation-active businesses reported the highest rates of joint R&D activity, 6.3 per cent in 2018–19. This compares to only 5.6 per cent of innovation-active medium sized businesses and 2.2 per cent of innovation-active small businesses collaborating on R&D in the same period. By industry (data not shown), the mining industry reported the highest share of innovation-active businesses with joint R&D activities at 8.5 per cent.[111]
4.1.4 Businesses collaborating with publicly funded research organisations
Collaboration promotes innovation, as collaborators build on other’s knowledge and experience. Patent data on collaboration between businesses and publicly funded research organisations (PFROs) suggests limited interaction between the two sectors in Australia. Among all patent families that include an Australian applicant, just 2 per cent involved collaboration in 2018. That said, collaboration varies substantially across technology fields and years; and it is also not present in all fields. In 2018, the technology fields with the largest share of patents involving business and PFRO collaboration were in Macromolecular chemistry, polymers (11.4 per cent), Biotechnology (8.2 per cent) and Optics (6.3 per cent).[112] A recent report by IP Australia found that collaborative grants have a higher impact on boosting all types of patent applications than non-collaborative ones. Further, a greater impact is seen for Patent Cooperation Treaty (PCT) applications, where PCT applications are submitted to obtain patent protection within multiple countries.[113]
4.1.5 Active licences, options and assignments (LOAs) yielding income for research organisations
Many Australian universities, medical research institutes and public research organisations license intellectual property (IP) to third parties, including businesses. Active LOAs that yield income are a subset of all active LOAs. They reflect high value IP in the research sector, as well as knowledge transfer between sectors. Data from the National Survey of Research Commercialisation (NSRC) provides a time series of the number of active LOAs yielding income in the research sector from 2006 to 2016. A peak in the number of active LOAs occurred in 2013 with 950 agreements reported, and an increase of 12.8 per cent can be seen between 2006 and 2016 with 719 and 811 LOAs reported, respectively.[114]
4.1.6 Income from active licences, options and assignments (LOAs) obtained by research organisations
Many Australian universities, medical research institutes and public research organisations license intellectual property (IP) to third parties including businesses. Active LOA deals that yield income provide an indication of IP with high commercial value as well as knowledge transfer between sectors. Survey data shows that total income in the research sector from licensing between 2006 and 2016 was over $2 billion. Over the decade, LOA income varied with spikes seen in 2009 and 2012 which corresponds to large increases in data provided by Commonwealth Scientific and Industrial Research Organisation (CSIRO). This also points to a broader trend — LOA income data often varies from the number of active LOAs executed due to considerable variation at the institutional level in the value of licensing deals.[115]
4.1.7 Consultancies, contracts and research collaborations with research organisations
A selection of Australian universities, medical research institutes and public research agencies are surveyed each year on their industry engagement via research-based consultancies, fee-for-service contracts and formal research collaborations. These activities provide an indication of how active the research sector is with respect to knowledge transfer to industry. Data shows that the number of consultancies, contracts and research collaborations undertaken from 2006 to 2016 fluctuated with an overall increase over the period. The largest number of consultancies, contracts and collaborations occurred in the most recent years with 18,076 and 18,279 activities reported in 2015 and 2016, respectively.[116]
4.1.8 Total gross value of consultancies, contracts and research collaborations with research organisations
A selection of Australian universities, medical research institutes and public research agencies are surveyed each year on industry engagement via research-based consultancies, fee-for-service contracts and formal research collaborations. Data shows that over 2006–2016, the total value of consultancy, contract and collaboration activity in the research sector was $16.1 billion. Compared to income derived from intellectual property (IP) licensing, $2 billion over the same period, this form of knowledge transfer is of significantly greater value. It may suggest consultancies, contracts and collaboration are increasingly the preferred avenue of knowledge transfer to industry over more traditional channels such as IP licensing.[117]
Footnotes
[109] ABS, Characteristics of Australian Business, Cat. No. 8129.0, Cat. No. 8158.0, Cat. No. 8166.0, Cat. No. 8167.0 and ABS.Stat
[110] ABS, Characteristics of Australian Business, Cat. No. 8129.0, Cat. No. 8158.0, Cat. No. 8166.0, Cat. No. 8167.0 and ABS.Stat
[111] ABS, Characteristics of Australian Business, Cat. No. 8129.0, Cat. No. 8158.0, Cat. No. 8166.0, Cat. No. 8167.0 and ABS.Stat
[112] European Patent Office (2020) PATSTAT 2020: Autumn edition
[113] IP Australia (2018) IP Report 2018: Collaborative research grants lead to better IP outcomes
[114] Department of Industry, Innovation and Science (2019) National Survey of Research Commercialisation
[115] Department of Industry, Innovation and Science (2019) National Survey of Research Commercialisation
[116] Department of Industry, Innovation and Science (2019) National Survey of Research Commercialisation
[117] Department of Industry, Innovation and Science (2019) National Survey of Research Commercialisation