European Software Proposal Will Hinder Innovation If Not Fixed, CCIA tells European Parliament

File Under: 2005, Copyright

Jun 27, 2005

RUSSELS JUNE 20, 2005 — A proposal to unify European patent law under a single legal regime will hinder innovation and add to the surging number of questionable software patents in Europe, the Computer & Communications Industry Association said in a report released this morning (Attached).

The “Directive on Computer-Implemented Inventions” is supposed to protect patent technology within physical devices such as cell phones, while continuing an increasingly ignored ban on patents for general-purpose software.

In fact, text of the Directive as approved by the European Council and now before the Parliament’s JURI committee would open the door to even more software patents, thus opening the door to a surge of frivolous patent litigation throughout Europe.

“Large manufacturers understandably see software patents as simply as an extension of their large portfolios for physical products,” CCIA President & CEO Ed Black said. “But in addition to specialized equipment-related patents, the Council’s directive appears to validate many patents o­n software that runs o­n desktop computers.”

The JURI committee is expected to vote o­n the measure Tuesday June 21. The full Parliament will take up the measure July 6.

Black applauded amendments proposed by MEP Michel Rocard (Rapporteur JURI) but warned that leadership of some Parliamentary blocs want their members to endorse the Council’s position unchanged.

“It’s unfortunate that politicians who are normally concerned about regulations and other burdens facing small and medium sized enterprises fail to understand the significance of validating the “status quo” – that is, 30,000 to 50,000 software patents awarded by the European Patent Office. From the perspective of developers, software contractors, and end users, this is like facing a stack of regulations 200 meters high.”

The CCIA statement notes that by creating a Directorate-General for the Information Society, Europe recognized that digital technology was unique and needed to be addressed free of assumptions.

“We understand the zeal to protect established market positions,” Black said, ”but this must be done in a disciplined and precise way if the Parliament wishes to preserve the prospects of Europe’s innovative new software developers. These developers are already protected by strong copyright laws. Software patents – a big company’s game -- will jeopardize their future.”

Some key highlights of the CCIA Position Paper:

The directive tries to enshrine economic policy into law at a time when the implications of software patents are poorly understood and the proposed legal standard is unclear. The Council’s “technical contribution” standard of patentability is undefined and simply restates a blurred, eroded line.

The Directive undercuts it own, stated purpose of bringing clarity and consistency to the law. Experience shows that attempts to limit patentability are subject to continued assault and circumvention because of economic, institutional, and political pressures to produce patents.

 

Software is entirely independent of the medium in which it is written, preserved, or transmitted – a fact that become much clearer with the advent of the Internet and the World Wide Web. The entire value chain around software developed for general-purpose computers is free of the costs of that encumber so many processes, from R&D to production to distribution. Software creation and distribution is open to individuals and small companies, tens of millions worldwide. It is the unique environment and the supporting infrastructure of the Internet and the Web that have made open source software development viable.

The proposed Directive may encourage investment in some areas such as cell phones or consumer electronic devices, but it will also clearly discourage new competitors from investing in software development. The patent system was never intended as a cross subsidy from o­ne sector to another. It was never supposed to skewing investment in favor of technologies where patents work well, and away from areas of economic activity where patents work poorly. Patents were never supposed to favor large companies over small, or established companies over entrepreneurs.