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The Evolution of Patenting Software

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The Evolution of Patenting Software 12JCULR Dr Anthony Place 11 The Evolution of Patenting Software DR A. G. PLACE Abstract The rapid evolution of software within the last 30 years has seen it move from a method of calculating mathematical expression to a technology in its own right that has permeated almost every technology and economic endeavour. For this reason courts have justified the patenting of software. Under current patent law, the system is particularly sensitive to control and interpretation, and must maintain a delicate balance between inventors’ rights and public access. As the assessment of novelty, inventive step and utility require identifying the field of technology, establishing the common general knowledge and constructing a hypothetical skilled addressee, there is an inseparable nexus between the patenting of software-related inventions and the nature of software and its designers. This paper provides a legal and technical perspective on the issues of software patents. The basis of the paper is that while software has evolved to become patentable, it is still rapidly evolving, which is putting tension on current interpretations and ‘traditional principles’. INTRODUCTION The software industry is a rapidly growing industry that has positioned itself within almost every other field of economic endeavour. For this reason, software patents cause a lot of confusion in the technical and legal professions alike. The complexity and misunderstanding associated with software patents can be attributed to software’s rapid evolution from a scientific and mathematical calculator to a pervasive product that has permeated almost every aspect of modern technology (and life). The patent system is an evolving process which is directed by public policy, legislation and judicial interpretations. This evolution is observed in the European Commission’s proposal for a directive to ensure patent protection for software throughout the EU1 and within the intellectual BE hons (computer systems) (JCU), PhD (JCU), M Eng Sci (signal processing) (UNSW), Grad Dip IT Law (UTS); Senior Research Engineer for Patentable Research and Development, www.patentable.com.au. 12 The Evolution of Patenting Software 12JCULR property chapter of the recent Australia-United States Free Trade Agreement2. The public policy that underpins the patent system is at risk if an adequate balance between inventors’ rights and public access is not maintained. Particularly in the technical field, software is often considered to be unsuitable for copyright and patent protection. Although it is one area of technology that is afforded both protections, neither is capable of providing adequate protection. This paper examines the issues of software patents within Australia in light of current legislation, judicial decisions and international trends. The concept of software patents is discussed in relation to historical conventional patents. A critical issue when discussing ‘software patents’ is to recognise that this is not a new class of patent and no new legislation was brought into effect to enable the granting of patent protection to software. As with other technologies, the patentability of software-related inventions must be assessed on ‘traditional principles’. To adequately understand the history of judicial interpretations, it is advantageous to understand clearly what software is, and how it has evolved in parallel with judicial interpretations. To this end a description of the evolution of software and an outline of some of its important properties is provided. The relatively recent acceptance of software-related inventions within the scope of patentable subject matter has raised issues relating to patent validity which have not been adequately clarified. I WHAT IS SOFTWARE? To understand ‘software patents’ first it is necessary to understand software, as legal interpretations and protections provided to software have not suddenly changed, but instead tracked the technological developments of hardware and software. The invention and development of the integrated circuit in the 1960s set computer hardware and software on a rapid series of technological developments. Initially computers were hard wired to perform particular 1 Proposal for a Directive of the European Parliament and of the Council on the patentability of computer-implemented inventions [2002] OJ C 151E/129. The European Parliament rejected this proposal in July 2005. 2 Australia-United States Free Trade Agreement, 18 May 2004, [2005] ATS 1(entered into force 1 January 2005). 12JCULR Dr Anthony Place 13 mathematical functions based on switch settings. These switches were replaced with punched cards that were read in a sequence to provide instructions, but the functions remained limited and the tasks remained mostly mathematical in nature. By 1973 the microprocessor3, floppy disk and computer networks had been developed, which provided a means to produce a more general purpose computer with greater functionality. To cope with this increased functionality and complexity, Operating Systems (OS) were developed to allow software to control hardware in standard ways and provide greater accessibility to users. By 1977 consumer based computers4 were on the market, and were quickly followed in 1981 by the International Business Machines Personal Computer (IBM PC) and the Microsoft Disk Operating System (MS DOS). The Apple Macintosh (1983) and Microsoft Windows (1985) further increased the accessibility of computer hardware and software. In keeping up with the computer platform a significant shift in the dynamics between hardware and software occurred. Computer hardware is focused now on providing a faster and more generic platform, allowing the software to dictate function. Programs now can be written for this more generic machine5. Software has developed alongside hardware and can be responsible for determining the system function. It can now be considered equivalent or indistinguishable. Software can be written with unlimited freedom of expression in any programming language to achieve the same outcome, the code does not monopolise its function. The engineering concepts of hardware, firmware and software have continually blurred over time. For dealing with intangible ‘things’ (data or information) the choice to use dedicated hardware, software or a combination of both typically comes down to an engineering decision. The rapid development of software and its migration, from merely controlling the mathematical functions of hardware, to providing general purpose processes that are integrated into almost every aspect of modern society, has fuelled the question of how software fits into ‘traditional’ systems of protection. Software has notable and unique characteristics that need to be considered when dealing with this question. Typically, software development is decentralised and relies on a highly layered system from hardware through to user interface with a high proportion of software developed ‘in house’ and never provided to the 3 United States Patent No 3,821,715 (The Intel 4004). 4 Initial consumer computers included the Scelbi, IBM 5100, Apple I & II, Commodore PET and TRS-80. 5 1978 - 1979 saw the development first spread sheet (VisiCalc) and word processor (WordStar). 14 The Evolution of Patenting Software 12JCULR public. The completed product is often produced by applying the code optimising compiler to produce a non-human readable ‘material form’ which is difficult to associate back to the original work. As the trend for computer hardware is to become generic, the compiled software is mobile6 and intangible7, making it difficult to deal with in isolation8. This environment of layered development, distributed development and mobile product has given rise to the ‘network effect’ whereby the first to market usually becomes the de facto standard and resulting in significant market power,9 which must be kept in check.10 A significant issue in controlling and protecting software is providing a definition that is flexible enough to recognise these characteristics and that includes the idea that software is more than just the code. The World Intellectual Property Organisation (WIPO) provided an early legal definition of a computer program when dealing with copyright laws,11similar to the definition provided by the Copyright Act 1968 (Cth)12 and the United States Copyright Act13, but focusing on the code as a series of instructions that perform a particular function. Although copyright is automatically afforded to an expression of code in material form,14 it does not protect any ideas or inventions used in producing the code. The Patents Act 1990 (Cth) does not attempt to define software as it provides 6 Mobility also makes it possible for small software developers to distribute software directly to consumers and is emphasized in network-oriented software (such as Java). 7 Software only needs a system of execution and not a physical container (‘material form’) to make it useful. 8 Unlike physical goods, Australian Customs Officers cannot seize software downloaded over the internet. 9 The near-monopoly positions of IBM in the 1970s and Microsoft in the 1990s are extreme examples of how control of a fundamental standard (in this case, the operating system) leads to control of application software as well. 10 Eg, Trade Practices Act 1974 (Cth); Fair Trading Act 1989 (Qld); Fair Trading Act 1987 (NSW). 11 World Intellectual Property Organisation, Model Provisions on the Protection of Computer Software, WIPO Publication No 814, January 1978,
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