Cato Institute Critique of Software Patents

binarybits writes "I've written an article for the free-market Cato Institute about how patents impede innovation in the software industry. It points out that people tend not to realize how vast the software industry is. It's not just Google and Microsoft; virtually every organization has an IT department producing potentially-infringing software. Organizations as diverse as J. Crew and the Green Bay Packers have been sued for patent infringement. It's crazy to expect all these organizations to worry about potential patent infringement. Hopefully the Supreme Court's Bilski decision will lead to new limits on software patents."

Comments

Yes, patent system not meant for software patents

[kanweg]

Patent attorney here. Yes, software patents shouldn't be there. Patents are there to stop people from sitting on their ideas. Stopping people from sitting on their ideas helps society, because it give society more knowledge. However, for software there is no need for this mechanism. There is no shortage of innovation because of lack of progress. If one person doesn't think of it, another one will. Also, the first sale doctrine doesn't work. If I have a patent on a resistor, and I sell it to you and you put it in a computer, you're free to do that. You don't have that with software. I can't buy a piece of, say, Word, and use it in my own programs. For the same reason, it is very hard to figure out whether your program is off the hook. Any aspect of a program could be patented. Finally, software patents are bad (with so called "wish" claims). I have programs developed for my company. It takes me 5 seconds to come up with an idea, but it may take the programmer 5 days, or 5 weeks, to implement. If I go with a software patent to a programmer, no time is saved.

The patent system is open source avant la lettre. An inventor has to provide all his knowledge (provide the best mode), in a way that can be replicated by an ordinary person skilled in the art, and it is available on line from patent offices. The "license" it comes with is a peculiar one (territorial limited/time limited), but it expires sooner than any copyright. But it is a rough tool. Fine for many types of inventions, including medical drugs, but not for software (or business methods).

Bert

Re:Yes, patent system not meant for software paten

[kanweg]

It is not either/OR. So, they get the copyright too. Double whammy.

Bert

Re:Yes, patent system not meant for software paten

[Halo1]

Copyrights are not enough. If X is the new innovative piece of code within a program, a competitor can buy the program, fire up a debugger, and look at the disassembled code for X.

At this point he's infringing copyright just as much as when he'd making unlicensed copies.

No, he's not.

Yes, he is, at least in the EU. Reverse-engineering is forbidden by software copyright law here, except if all of the following conditions are true:

• it's solely for the purpose of interoperability
• the information you need is not readily available otherwise
• you do not publish the information that you discovered this way (although you can sell programs making use of this information; not sure how this would work with open source)

See article 6 of the EU software copyright directive.

The output of his reverse engineering will be the abstract method that can be covered by a patent, but not by copyright. For example, after looking at the disassembly for X, and performing more analysis using a debugger, he figures out the steps to perform X are:

At the very least, you are tainted when you do stuff like this. Phoenix didn't do clean room reverse-engineering for nothing when they re-implemented IBM's BIOS.

Then there are cases where the code is not that hard, and you can copy the idea by just looking at the end product. Therefore having patents is necessary.

Well, no. It's only necessary if the competition stemming from this imitation kills the market rather than stimulate it. In general, more competition is better.

Right, but competition usually means performing to equal or exceed your competitor.

And this can be in many ways: customer service, price, time to market, branding, offered products etc.

If you simply sit by and wait, then copy (steal) something innovative created by your competitor, that's not performing at all.

Actually, that is exactly how competition works. You take what already exists, duplicate it and presumably add value in one way or another (from the list above). A certain amount of imitation is mandatory to have a competitive market.

Thanks to copyright and to the complexity of making well-working and polished software, innovators automatically have a limited lead-time advantage. Artificially extending this by many years using patents is only justifiable if otherwise the entire innovation of the industry would collapse. And there are simply no indications that this is the case, on the contrary.

It's just leeching off someone else's work to profit yourself. Soon inventors will get tired of getting taken advantage of, and only pursue inventions that take little time and money. That way, if someone copies their ideas, the loss won't be much. But society, as a general, will suffer more because many good inventions take more time and money, and those won't be created without sufficient protection.

It turns out that the above is simply not true in case of the software world. Competition (i.e., what you call copying, stealing and whatnot) is what drives innovation in the software industry, and the traditionally mild IP-regimes have been very conductive to this. See the overview of studies I posted in a previous comment.