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This paper aims to study the development of radio frequency identification (RFID) technology through an analysis of patents filed with and issued by the US Patent and Trademark Office. A close analysis of these clusters reveals the patent development strategies of two competing factions of RFID technology developers. This paper provides an analysis of the patents along with insights into the contents of the patents held by these two groups.

The analysis is based on Intermec Technologies and the RFID Patent Pool, the two major players in this domain. The comparison of Intermec Technologies and RFID Patent Pool is conducted using meta‐data analysis and patent content clustering. The methodology and approach includes data pre‐processing, key phrase extraction using term frequency‐inverse document frequency, ontology construction, key phrase correlation measurement, patent technology clustering and patent document clustering. Clusters are derived using the K‐means approach and a prototype Legal Knowledge Management Platform.

The findings support a strong link between intellectual property and competitive advantage – specifically Intermec Technologies, which have not joined the RFID Patent Pool. The patent search results show that Intermec Technologies hold basic RFID patents in the early stages of technology development, which has placed the company in a dominant position.

The features of each cluster clearly depict the niches and specialties of companies and provide a historical framework of RFID technology development.

The RFID patent analysis shows that if a company holds crucial patents in the early stages of a developing technology which relate to the fundamental key aspects of the technology, then the company will be more likely to maintain a leading and dominant position in that industry segment (i.e. RFID in this study).

This research uses patent content cluster analysis to explain the rationale behind an alliance strategy decision.