[Linux-aus] Re: [Osia-discuss] Ross Gittins "Gets It" w.r.t. Software Patents

Ronald Skeoch rbs at muli.com.au
Mon Aug 2 10:18:01 UTC 2004

On Sun, 2004-08-01 at 13:58, Les Bell wrote:
> See http://www.smh.com.au/articles/2004/07/30/1091080437270.html . Good to
> know the word is spreading . . .
> Best,
> --- Les Bell, RHCE, CISSP
Ross Giddens has followed up today's SMH
This issue is so inportant for all Australian
software people to understand
I have taken the liberty of including same
I could not of said it any better :

Trade deal a free kick for US software racketeers
By Ross Gittins
August 2, 2004 

One reason the free trade agreement with the United States is getting
such an easy ride from Australia's business people and economists is
that they know so little about intellectual property rights.

It may well be that the most far-reaching and detrimental aspect of the
deal is the way it obliges us to "harmonise" our patent, copyright and
trademark protection with America's. So we get to inherit the Yanks'
administrative weaknesses and whatever rorts powerful industry lobbies
have managed to con the US Congress into passing.
Here is the second part of the contribution I received from an anonymous
software engineer. In my Saturday column, he confessed to his part in
abusing US patent law for anti-competitive purposes. Today he gives his
views on the merits of the free trade agreement from a software
producer's perspective: 

In the past few years, American companies have filed millions of dubious
software patents. It is only relatively recently that these software
patents and the even more dubious "business methods" patents have been
allowed, and already the negative effects are plain to see.

It is sobering to think that under the current US intellectual property
regime Microsoft Windows would not exist, as Apple Computing would have
easily won its "look and feel" court case in the early 1980s. 

Because of the extreme ease with which software patents are obtained,
the effect of the patent system is the opposite from that intended.
Rather than fostering innovation, it has allowed for large firms to form
monopolies, suppressing faster and more efficient competition. 

It has allowed true "intellectual property pirates" to appear,
selectively threatening to sue small companies that do not have the
resources to defend themselves in court. And it threatens what is now
the most innovative single force in computing, "open source" software.

The outcome for Australia is clear. We are a net importer of software.
So software patents, by allowing monopoly profits with monopoly pricing
and monopoly standards of quality, can do us a great deal of damage. 

A large quantity of the Australian software budget is spent overseas
buying such monopoly products. So encouraging the already existing drift
towards US-style software patent laws that favour the existing
incumbents could result in this expenditure increasing indefinitely. 

This is especially sad since there is one area in software where
Australia punches well above its weight, and that is in collaborative
open source software. In the open source model, when a number of people
and companies find they have a need for a software product, they
co-operate to create it. 

This allows firms and individuals to gain access to the product for
significantly less than it might otherwise cost them. Since the cost of
replicating software is almost zero, a free licence to use the software
is granted to all comers, who are then free to improve it themselves and
feed those improvements back to the original users. 

Software built on this principle is widely used. It runs most of the
internet, most of the world wide web, and provides a vast number of free
and open tools for software engineers. It is also used as part of many,
many commercial products, such as Apple's OSX operating system, IBM's
web products, Sun's java offerings and so on.

Australian software developers excel in this area, and are enthusiastic
and frequent participants in world software.

Unfortunately, open source software, and open competition based on open
engineering standards, represents a serious threat to those existing
software producers who are too inefficient to compete on a level playing
field, or who simply want to lock past successes into an indefinite tax
on the future.

Like the canal owners of old faced with the threat of railways, some
desperate (or greedy) businesses are attempting to use the courts as a
substitute for talent. 

Already in the US litigation and threats of (often unspecified) patent
and copyright violation are used regularly by software giants to either
suppress completely, or acquire on favourable terms, smaller and more
innovative firms.

Importing this legal circus to Australia could only harm the smaller
players in the local industry, both open source developers and
independent software companies.

It is important to remember that patents and the other legal tools of
intellectual property are relatively recent, artificial instruments made
for a purpose: to encourage the invention and production of goods.

Traditionally, patents covered purely physical inventions. They have
been extended, primarily in the US, into the realm of ideas and
information to cover increasingly doubtful notions, such as a genome
sequence already existing in nature, a business process, mathematical
equations and so on.

The primary drivers of these extensions are industry lobbyists who
realise the massive profits that can be made by such government-granted
monopolies. It is a sterling example of how a small group with much to
gain can lobby government for privileges at the expense of the greater

In some circumstances, where years of research and massive investment
are required to produce an easily copied invention, patents may allow
the production of otherwise uneconomic goods, to the general benefit of
the public, by promising a temporary monopoly and resulting large

A good portion of article 17 of the free trade agreement is concerned
with pharmaceutical patents for this very reason. In the software world,
however, the idea of a market in intellectual property based on patents
is misguided. 

Competition is what drives the sector, the barriers to invention are
very low, and any good computer science student should be able to toss
off a dozen "patentable" ideas before breakfast. There is no massive
intellectual investment to protect, and although in some cases the
software itself that crystallises a set of ideas may take years to
write, it is covered under copyright law.

Software patents are bad news for Australian companies who will be
forced to play an expensive legal game against people who are ruthless

They are bad news for Australian users, who will pay monopoly prices for
software. And they are bad news for Australian software engineers, who
will find lawyers designing their programs.

Existing copyright law is all the protection computer software needs.
Anything else is a free kick for the US software patent racketeers.

Ross Gittins is the Herald's Economics Editor.

Ronald SKEOCH  MD. Muli Management Pty Ltd.
124 Fox Valley Road, Wahroonga, NSW 2076
Sydney Australia.Ph 612 9487 3241 Fx 9487 3583
Software Solutions for Project based business.
Project Risk, Accounts & Process Management.
Protagonist for open software

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