Commercial and open source software proponents probably agree that whether patents in the software industries promote innovation relies on the ability of the USPTO and courts to administer and enforce high patenting standards. Still, there remain elements of the open source movement, and various fanatical sects, that seek elimination of patents for software altogether. Obviously, eliminating, by estimate of Professor Lemley, over 100K software patents will have significant consequences due to the widespread proliferation of patents in the industry, the reliance of companies on patents in cross-licensing agreements and their capital/ investment structure. Simply getting rid of software patents may be far more expensive and damaging than having courts apply Lemley’s “policy levers” when interpreting patents, or going through USPTO reform. Why argue for the extreme maneuver of Napsterizing software patents then? In my view, those who push for getting rid of software patents do so because it’s an easy argument that does not necessitate delving into the complexities of innovation and technology policy.

Advocates for eliminating software patents have their academic supporters: Lessig and Moglen being two popular ones. Now, as capable as insightful as they are, I do not believe either is the most effective opponent of software patents. There are many other researchers with expertise in industrial organization, history of innovation, empirical economic- policy research, who actually specialize in patents, and who dislike software patents just as much as Stallman. Now this is interesting. Why does the open source movement not embrace these scholars for their cause? Well, none of them have such clear cut and extreme positions as scholars open source calls its pals. Patent experts recognize the insight of Professor Lemley that “nobody knows how innovation works.” Supporters of banishing software patents contend that they know the consequences and effects on innovation of setting them loose, often by comparing today’s innovation to previous eras of American regulatory policy without specific analysis to either technology (network, desktop, etc) or business model. Rather, enemies of software patents have a comfy time following propositions such as this passage from Professor Lessig in arriving at their conclusions:

The core of the Internet was this collection of code built outside the proprietary model. For the property obsessed, or those who believe that progress comes only from strong and powerful property rights, pause on this point and read it again: The most important space for innovation in our time was built upon a platform that was free. 57. The Future of Ideas. 2000.

This passage ignores several things. But setting historical interpretation aside, Professor Lessig would have readers believe that “outside the proprietary model” gives open source a win over patents and IPRs; that technological innovation has occurred without patents and will continue if the USPTO starts shredding software patents files. Professor Lessig, being one of the most popular figures in the open source movement, is rarely cited for his work on history of innovation, and probably less for patents. Here, I would like readers to see other perspectives on IP and the path of innovation leading up to our modern day, which suggests that eliminating software patents is not as easy as it seems:

Yes, economic theory and practical experience tell us software patents can be good. What ideology funneled into extremist policy views pales in comparison.

Generally speaking, both economic theory and practical experience suggest that the availability of patents for software promotes innovation by supplying (additional) incentives to inventors. 5. Mark Lemley and Julie Cohen, Patent Scope and Innovation in the Software Industry, California Law Review, Vol. 89, P. 1, 2001.

The early history of the software industry is one in which innovators developed impressive new products at very little cost in the absence of patent protection. Some have argued that software should not be patentable even today, though that argument ignores some economic changes in the industry and in any event seems unlikely to prevail. Mark Lemley and Dan Burk. Policy Levers in Patent Law (August 2003). UC Berkeley Public Law Research Paper No. 135; Minnesota Public Law Research Paper No. 03-11.

…regional or national systems of intellectual property policy have evolved in parallel with the software industries. 27. David Mowery and Stuart Graham, Intellectual Property Protection in the Software Industry. 2000.

Defense related procurement, which played a prominent role during the earlier stages of the Internet’s development, was not an important factor during the 1990s. …The relatively open IP regime that typified the development of Internet infrastructure also appears to have shifted towards a pro-patent posture… the shift in US macroeconomic policy from its destabilizing posture during the 1970s and 1980s toward greater stability assuredly contributed to the capital investment boom that underpinned the domestic diffusion of the internet. 246. David Mowery and Stuart Graham, Technological Innovation & Economic Performance, the Internet. 2002.

posted by Noel Le @ 9:54 AM | Academia, Markets: Business, Investment & Innovation, Patents

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