Ask HN: When are Software Patents necessary?
14 comments
To start with: IAAPL.
In my opinion, there are only three times when software patents are useful:
1. There is a hard computer science problem at the very core of your product or service -- one that you have solved, that competitors have not, and that gives you an advantage. Further, the answer to this problem, once known, is easily replicable. The canonical example of this is Google/PageRank, and the closest non-software analogue is drug research. This is what software patents are designed to protect and they usually do an ok job of it.
2. You are a large business and you have grown to the point that you are attracting attention from patent trolls and other large, patent-holding entities. At this level, the quality of the patents usually doesn't matter nearly as much as the quantity. It becomes a "my stack is bigger than your stack" type of negotiation, and having a very large pile of manure is useful because people are forced to assume there is a pony or two in there. If you want to see an example of a company that has recently had this realization, look at Huawei and compare their total number of issued patents with their total number of patent applications.
3. You are inventing a completely new type of hardware device and you also file for patent on the software that interacts and enables it.
Two special cases:
If you are a startup, then (IMO) it rarely pays to file for patents unless you a) expect to get really big, or b) want to sell out to a big company. This is a special case of #2. Otherwise, execution trumps IP. Startups are just not big enough to worry about (or be targets).
It also may pay if you are creating a completely new market - think RSA. If software patents are part of this, then this is probably a special case of #1.
In my opinion, there are only three times when software patents are useful:
1. There is a hard computer science problem at the very core of your product or service -- one that you have solved, that competitors have not, and that gives you an advantage. Further, the answer to this problem, once known, is easily replicable. The canonical example of this is Google/PageRank, and the closest non-software analogue is drug research. This is what software patents are designed to protect and they usually do an ok job of it.
2. You are a large business and you have grown to the point that you are attracting attention from patent trolls and other large, patent-holding entities. At this level, the quality of the patents usually doesn't matter nearly as much as the quantity. It becomes a "my stack is bigger than your stack" type of negotiation, and having a very large pile of manure is useful because people are forced to assume there is a pony or two in there. If you want to see an example of a company that has recently had this realization, look at Huawei and compare their total number of issued patents with their total number of patent applications.
3. You are inventing a completely new type of hardware device and you also file for patent on the software that interacts and enables it.
Two special cases:
If you are a startup, then (IMO) it rarely pays to file for patents unless you a) expect to get really big, or b) want to sell out to a big company. This is a special case of #2. Otherwise, execution trumps IP. Startups are just not big enough to worry about (or be targets).
It also may pay if you are creating a completely new market - think RSA. If software patents are part of this, then this is probably a special case of #1.
My current analysis led me to the following current (!) conclusion.
A lot of "software" patents are invalid, because they are no real invention in it. They are nothing more than an idea ownership claim. They are never put in application in any business. Their purpose is to be land mines, hoping for a big $ company to accidentally step on it.
On the other side there are patents describing really innovative procedures and software technology requiring a significant investment to be applied in an industrial process. The investors would logically want to secure their investment until break even.
If you feel yourself in the second group, patenting is still questionable. By blocking competition, one is cutting out the possibility to benefit from it. A good example is Groupon. A german company copied the unpatented idea and developped it Germany. They had the skill, they got the market by leveraging the cultural advantage they had regarding german marketing. 9 month later Groupon bought them 50M€. Groupon bought a proven team and market without initial investment and risk. It is a win win transaction. If Goupon had pattented their idea, they wouldn't get this.
A lot of "software" patents are invalid, because they are no real invention in it. They are nothing more than an idea ownership claim. They are never put in application in any business. Their purpose is to be land mines, hoping for a big $ company to accidentally step on it.
On the other side there are patents describing really innovative procedures and software technology requiring a significant investment to be applied in an industrial process. The investors would logically want to secure their investment until break even.
If you feel yourself in the second group, patenting is still questionable. By blocking competition, one is cutting out the possibility to benefit from it. A good example is Groupon. A german company copied the unpatented idea and developped it Germany. They had the skill, they got the market by leveraging the cultural advantage they had regarding german marketing. 9 month later Groupon bought them 50M€. Groupon bought a proven team and market without initial investment and risk. It is a win win transaction. If Goupon had pattented their idea, they wouldn't get this.
Firstly, by the time Groupon got the patent it would've been irrelevant. It takes years.
Secondly, being in Germany (ie the EU) software patents are largely unenforceable [1] anyway.
Software patents are almost uniquely a US problem, despite lobbying efforts to introduce them in Europe, Australia and other places.
But my point is that whether or not Groupon applied for a patent in this case is basically irrelevant.
The story about software patents is they may end up driving Internet businesses, which are highly portable, to jurisdictions more friendly to their activities.
The only beneficiaries of software patents are lawyers and patent trolls (who have nothing to lose by definition because they don't produce anything).
What would be ironic would be if a Troll patented the business model of filing and buying patents by the truckload and then suing possible infringers right before suing every other patent troll.
Oh and regarding Google's PageRank (mentioned elsewhere in this thread), the patent is basically defensive. It doesn't really disclose the details of it such that it could be easily reproduced. Plus, even if it did, there's an awful lot more you'd need to do to mimic Google.
[1]: http://en.wikipedia.org/wiki/Software_patents_under_the_Euro...
Secondly, being in Germany (ie the EU) software patents are largely unenforceable [1] anyway.
Software patents are almost uniquely a US problem, despite lobbying efforts to introduce them in Europe, Australia and other places.
But my point is that whether or not Groupon applied for a patent in this case is basically irrelevant.
The story about software patents is they may end up driving Internet businesses, which are highly portable, to jurisdictions more friendly to their activities.
The only beneficiaries of software patents are lawyers and patent trolls (who have nothing to lose by definition because they don't produce anything).
What would be ironic would be if a Troll patented the business model of filing and buying patents by the truckload and then suing possible infringers right before suing every other patent troll.
Oh and regarding Google's PageRank (mentioned elsewhere in this thread), the patent is basically defensive. It doesn't really disclose the details of it such that it could be easily reproduced. Plus, even if it did, there's an awful lot more you'd need to do to mimic Google.
[1]: http://en.wikipedia.org/wiki/Software_patents_under_the_Euro...
Out of all of the software patents granted, probably only 0.01% of them are arguably patentable. By 'arguably patentable,' I mean that there is actually debate to be had on the issue. All of the rest of them are frivolous and no one other than MBAs and patent lawyers think that they are valid (or should exist).
I can definitely relate to this with a point of reference. A freelance project I worked on this year was funded by an overly prideful MBA coming out of Sun Microsystems. He was very stubborn and refused to continue work until he could secure a patent despite my warning.
$5000 later his lawyers warning came by phone. It is clear to me now that he was just following some MBA checklist.
$5000 later his lawyers warning came by phone. It is clear to me now that he was just following some MBA checklist.
What i find is that patents on software just protect your intellectual property, it only protects the idea if one of your employees that gets smart and leaves your company and starts to compete with you doing the same thing with the same software processes. In software all that matters is the final result , and so the result can be gone about to acheive in many different ways. So my advice is to not worry about protecting your IP until you have enough money to go after those that are infringing on said patent.This is a good rule of thumb.Also make sure that your process is not "obvious"(example: one of the most obvious ways to measure liquid is by pouring it into a container that contains precise measurements/volume), you may be infringing on someone else's patent :)
1. You are expecting/hoping to be bought and you want to increase your IP assets to be more attractive.
2. You expect to someday become a target of patent suits and you need defensive patents.
3. You have something really innovative and it's obvious to the user/externally visible so you want to patent it before someone else does or so you can license it. I've never understood the point of patenting algorithms that aren't visible from the outside.
Besides these three examples, I don't see the need for software patents. Unlike say, a physical mechanism, software is largely invisible, so trade secrets should offer enough protection for the vast majority of cases.
2. You expect to someday become a target of patent suits and you need defensive patents.
3. You have something really innovative and it's obvious to the user/externally visible so you want to patent it before someone else does or so you can license it. I've never understood the point of patenting algorithms that aren't visible from the outside.
Besides these three examples, I don't see the need for software patents. Unlike say, a physical mechanism, software is largely invisible, so trade secrets should offer enough protection for the vast majority of cases.
Thanks all. Your answers are consistant with the vibe I've gotten from past software patent discussions on HN. I'll lay the matter to rest.
The reason I ask is because I'm currently working on a project that is very unique (at least I hope). My instinct is that I haven't "invented" anything, but it definitely isn't being done in the way that I intend to, elsewhere.
I don't want to be evil about it. I believe in competition and welcome it. But I do want a fair chance at the market for my own business. Maybe there is a business strategy that resolves this? I mostly want to prevent already existing competitors from adopting my ideas/implementations in their own applications quicker than I can build my own business.
Also, I'm not letting this concern keeping me from making progress (there are plenty of other things doing that). But, a bit of clarity might help me stay focused when overwhelming myself with concerns.