The Value of Software Patents
Jay Parkhill March 7th, 2008
I am at conference today at UC Berkeley’s Center for Law and Technology. I just sat through a terrific panel discussion on the usefulness of software patents.
Brad Feld is a noted opponent of software patents. He held his own well against several others on the panel. If I understood his position correctly, it was (a) that the effort to prosecute patents is lengthy and time-consuming, (b) that software is such a dynamic field that patents can’t keep up with evolution of a business (especially a startup business), and (c) that IP portfolios result in extensive IP reps & warranties and significant potential liabilities when the startup eventually sells to a larger business.
On the other side, the argument is that patents represent a stake in the ground for any business. Weak patents exist, but when a company develops unique technology and protects it with a patent(s), it helps that company to establish its own value and possibly sell services around the technology.
In addition, because patents are public records, the knowledge goes into the public realm to serve as the basis (with due attribution/license fees) for future innovation.
The pro-patent camp’s arguments are relevant in all fields- not just software- so the question is really whether software is so different from, say, biotech, that the patent system doesn’t work.
My gut tells me that software is a more nimble field than many others, with much shorter product lifecycles. A 20 year term on a software patent probably won’t generate much value after the first 5 years or so (though the MSFT Windows group may disagree).
Still, abolishing software patents outright sounds like flushing the baby with the bathwater. This is certainly not my area of expertise, but I will venture my opinion that software companies need to think a little harder than companies in other industries about whether a patent will generate more value than risk, but that patents can still provide significant value.
I’d love to hear other opinions, though. As noted, I am no expert here and trying to understand the scope of the debate as much as I can.