Are Software Patents Relevant?

While proponents (usually with deep pockets) have touted their benefits, software patents have also been used in the software industry to suppress innovation, kill competition, generate undeserved royalties, and make patent attorneys rich. So I ask, are software patents still relevant?

It’s no secret that the engineering software business is extremely competitive, as it always has been. The engineering software business has also proven to be a very fertile ground for lawsuits regarding patent infringement, reverse engineering, and outright copying and pasting blocks of code.

Could stronger patent protection have prevented this from happening? Maybe yes, but probably, no.

The Danger of Software Patents – Richard Stallman

Software patents has been hotly debated for years. Opponents to them have gained more visibility with less resources through the years than pro-patent supporters. Through these debates, arguments for and critiques against software patents have been focused mostly on the economic consequences of software patents, but there is a lot more to it than just money.

The arguments for software patents include:

• Economic benefit (first and foremost) — increases corporate valuation and ROI for investors.
• Public disclosure – educating the public (and prospective customers) on something not previously known.
• Innovation – Protection promotes innovation.
• Software copyright limitations – patents protect functionality; copyright protects expression.

The arguments against software patents include:

• Software is basically ordered math – a program is a representation of an algorithm, nothing more.
• Encourages patent jams – complexities with knowing what is truly new, cross licensing, discourages newcomers and innovation.
• Hinders R&D – funds for innovation often take a back seat to putting money aside for possible litigation (see next point).
• Often only lawyers get rich – A study a few years found that American public companies’ total profits from patents (excluding pharmaceuticals) in 1999 were about $4 billion, but that the associated litigation costs were $14 billion.
• Patents are expensive – a few years ago, the cost of filing patents was estimated at $5,000 to $15,000, where software patents tend to cost closer to the higher end of the spectrum. In addition, the cost of patent litigation was estimated prior to a trial at $1 million, and for a full patent defense, $2.5 million.
• Patents have more losers than winners – the probability of actually making money from a patent has been estimated for some time at less than 10%. If possible litigation costs are considered, the likelihood of profiting from a patent drops even lower.
• Patents take a long time – the time required to prepare for a patent, submit it, have it examined, and granted an outcome takes multiple years – not exactly conducive to “Internet speed.”
• Copyright may be sufficient — the right of an author(s) to prevent others from copying their creative work without a license provides that the author of software can sue someone who copies that software without a license. Copyright protection is given automatically and immediately without the need to register the copyright with a government, although registration does strengthen protection. Copyrighted material can also be kept secret.
• Trivial patents – some software patents cover inventions that are obvious to people with skill in programming at the time the invention was created.
• Patent office limitations – patent examiners rarely have a comprehensive knowledge of the specific technologies and methods disclosed in the software patent applications they examine.

Linus Torvalds: Software Patents Make No Sense

Lastly, let’s admit it – software is different than physical objects/devices because they are designed only in terms of their function.

The inventor of a typical electromechanical device must design new physical features to qualify for a patent. On the other hand, a software developer need only design new functions to create a working embodiment of the program. ^[1]

Software is a component of a machine. The computer’s hardware is generic; it performs functions that are common to all of the software that is capable of being executed on the computer. Each software program that is capable of executing on the computer is a component of the computer. ^[1]

Computers “design” and build the structure of executable software. Thus, software developers do not design the executable software’s physical structure because they merely provide the functional terms.^[1]

So, do software patents fulfill their intended purpose and are they still relevant? I would argue largely, no.

Some possible solutions I would propose include examining software patent submissions that are truly innovative, streamlining the patent process, making it more difficult to patent software, making it easier to invalidate software patents, and shortening the patent protection period from 20 to 10 years.

Am I an expert on patents? No, but I do have experience, having been granted three patents. I didn’t get rich from them, primarily because I had to sign over the patent rights to my employers at the time as a condition of employment. However, I did receive a total of $3.00 for my three patents, while two of the patents went on to earn my employers several million dollars. Tough to take, but mine was hardly an isolated experience. I guess that’s what I can chalk it up to – expensive experience.

[1] Robert Plotkin.“Intellectual Property and the Process of Invention: Why Software is Different”. Law Office of Robert Plotkin.

Tags: innovation, lawsuit, litigation, software patent

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