Copyright Vs. Patent: The Future Of Software Development


The Economist has published a thought-provoking article that poses the thorny question: do patents help or hinder innovation?

Patents grant inventors a twenty year monopoly in which to build
and benefit from their idea. This is great news for the inventor,
but blocking anyone else from tinkering with this pre-existing
technology, is always going to have a negative effect on
competition. Healthy competition and innovation often go
hand-in-hand, as companies and individuals clamber to come up with
the next, exciting interpretation of a product before anyone else.
But, if an idea is patented, then it becomes a one-person race. The
patent-holder doesn’t have the same motivation to get the best
possible version of their product into the market as quickly as

Patents discourage the combining and recombining of inventions
to yield new products and processes, and encourage insular
development. Patents advocate maintaining a monopoly on
intellectual property, rather than co-operating with other
companies and inventors, to come up with the best hybrid product
possible. Even when it is necessary to negotiate cross-licensing
deals with competitors, the time and effort it takes to pour
through the portfolio of existing patents, combined with the
transaction costs of negotiating the deal, is what the The
Economist calls a “tax on innovation.” The cost of navigating the
tricky cross-licensing waters, may exceed the potential commercial
value of a cross-patent product. The result? A potentially
important new product is simply not commercially viable, and never
sees the light of day.

The popularity of patents has inevitably resulted in an increase
in litigation. A commercially successful idea is bound to attract
waves of imitators: which means plenty of ongoing court fees. It’s
difficult to argue that maintaining patents increases overall costs
and, with only so much money to go around, that is bound to have an
adverse affect on the creation of new products. “In a majority of
cases, the cost of litigation will far exceed any revenue the
inventor may subsequently earn from royalties or licensing,” claims
The Economist, which makes you wonder whether it’s even worth
having a commercially viable idea to begin with!

But, plans are currently underway to shake up the patent system
within the sphere of software development. America’s Supreme Court
is on the verge of issuing a ruling which, apparently, will make it
more difficult to get a patent for a business process. And, since a
business process is usually just a method for solving problems
using a finite sequence of instructions, it is fair to say that
‘business process’ equates to ‘computer algorithm.’ This ruling
could potentially bar all sorts of ongoing software patents. The
Economist claims such a ruling could cause an important shift in
the attitudes of software developers. Instead of seeing their ideas
as patentable, they will see the expressions of their ideas as

The Economist’s argument that copyright is the future of a
software industry bogged down in patents, fails to factor in a few
things. Firstly, copyright can stretch until one hundred years
after the author’s death, whereas a patent lasts for around twenty
years. Surely, the longer monopoly granted by copyright, should be
taken into account in any discussion about legal rights damaging
innovation. In some instances, a long copyright on an “expressions
of ideas,” might have more negative impact on the market, than a
shorter patent on the idea itself. Also, some computer algorithms
take vast amounts of time and effort to design, and it is perhaps
not unreasonable that an organisation would want to protect this

“Copyright protection is far too narrow in scope to provide any
commercially significant protection against acts other than
straight piracy,” commented one visitor to the article. And, while
a ‘loosening’ of the intellectual property laws could accelerate
development, with organisations and individuals all tinkering with
one another’s designs and coming up with the best possible product;
innovation and invention still have to be worthwhile, in the
commercial sense. All that work isn’t worthwhile if someone else
can use it. It’s a balancing act and neither copyright nor patents
on their own, can get the balance absolutely spot on.

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