Thinking about Software Patents

OK, I’m going to open up a can of worms that I’ve been thinking about for a while now, but that I have avoided writing about: patents, and in particular software patents. First let me say that I don’t know nearly enough about the role that patents play in software development and by extension in IT. However, over the last few months I have come to understand that the role is large, albeit mainly behind the scenes, and that it is poised to become one the most important issues confronting CIOs over the next few years.

I wish I could back that claim with evidence and anecdotes—the sort of thing that you are used to seeing in the magazine—but I can’t. Not yet, at least. I intend to spend the next several months looking into the subject, though, and since you were all so helpful when it came to Sarbanes-Oxley compliance, I figured I would turn to your guidance on this subject as well.

So with that qualifier in place, I’m going to throw out some statements in order to get some reactions. These will be worded strongly, but that is mainly to force you into a gut reaction, which I hope you will then share with me (if you don’t want to leave a comment feel free to email me).

1. Patents and copyrights are the policy area where technology companies are most active, not just in the United States but worldwide. For example, Microsoft recently began lobbying for an overhaul of the U.S. patent system.
2. Technology companies are increasingly dependent on patents in order to maintain or gain market share. In 2004 IBM received 3,248 new U.S. patents. Microsoft filed for 3,000 (according to the article linked in point one).
3. While patents, and specifically patent disputes, have had a large impact on the software market, they have not had much of an impact on CIOs yet. This will change over the next few years as software companies look to retain current revenue streams and create new ones. Software patents give software companies leverage over their customers, and while this leverage has not been applied to date, it may in the future.

I’ve listed these in order of conviction. I believe number one, I’m inclined to believe number two, and the investigative journalist in me suspects that number three may be true, but I’m not ready to believe it yet. What do you guys think? Are these right or wrong? Are there other points that I’ve neglected to consider that are even more important? And as always, if you are an expert on the subject please post corrections, better explanations, or just set me straight.

(Of note, CIO magazine has covered this a little bit in the past. A year and a half ago we asked two experienced patent attorneys to argue the two sides of the case: Is the patent system breaking down, or is patience a virtue? You can still read The Great Debate over Software Patents online.)