Raul just spent the past year developing an amazing web application that will power his new website. He even received venture capital funding for the project, has a marketing plan in place, and believes his new app will take off in markets all over the world.
Despite his optimism, Raul’s business is still considered small. The Internet will give him global reach, but as the sole proprietor of his small independent software company, he only needs to make a relatively small pot of cash.
When the app finally goes live, it is an instant success, just as he predicted. Everything seems to be going smoothly and web users all over the world are using it. But one day, Raul receives an email, followed by a letter in the mail, both saying the same thing. It is a cease and desist letter from a large corporation, one that claims Raul’s new app violates several of their patents.
Instead of finally achieving financial success and changing the world with his software, Raul finds himself faced with a lawsuit, unless he pays steep licensing fees for patent usage rights.
The above story is fictitious in that Raul does not really exist, but the scenario has happened many times. Corporations holding software patents do not always actively attack other companies, but when they do, the results can be devastating to innovation. Many of the patent holders are not even the original inventors (and I use the term loosely), but instead are third-party investors who purchase patent portfolios with the primary objective of profiting from their licensing.
The U.S. patent office has been particularly active in granting patents to companies for very basic and sometimes even vague computer processes, such as the double click and multi-touch screen functions. Because they are processes and ideas rather than actual tangible inventions, they prevent innovative competition among software developers and give major corporations with large legal teams a decisive advantage over small and medium software businesses.
A good example of the problem with software patents is the current debate of HTML5 video. According to virtual dedicated hosting company 34SP.com, the web has always been based on free and open technology and will eventually have a new development standard with HTML5. Included in the new specifications is a tag for video that embeds and streams video without the need for third-party plugins, such as Adobe Flash Player or Apple Quicktime.
Originally, the specification called for the open Ogg Theora format to be the standard, but Apple and others protested, claiming that H.264 produced better quality. The problem with H.264, however, is that it is laced with software patents held by a patent licensing firm called MPEG LA. In this case, even the threat of possible patent litigation can be discouraging for a business that wants to get involved with web-based video streaming.
There are methods that software developers can use to fight back against software patents. One such method is to prove that you developed the invention first. Unfortunately, this sometimes becomes difficult to prove when the “invention” is actually an idea. There are also some non-profit organizations that will take a case to defend a software developer against patent infringement accusations.
Unfortunately, fighting patents will not stop them altogether, and there is a danger that some legal actions against patents may serve to legitimize them. A better approach is to convince lawmakers to halt the blind approval of software patents by patent agencies in various countries.
If legislation is not changed, software patents threaten common software, particularly free and open source software, that is used on computers, servers, phones, and other devices all over the world. The result will be a lack of quality innovation, competition, fair pricing, and independent developers. None of that is good for the progress of society. If our technology becomes constantly entangled in patent lawsuits that take years to be resolved, development and innovation will slow to crawl, leaving the world crippled by its own laws.