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An Analysis of the Scope of Copyright Protection for Application Programs An Analysis of the Scope of Copyright Protection for Application Programs Peter S. Menell* I. AN OVERVIEW OF THE DESIGN OF APPLICATION PROGRAMS... 1050 A. An Introduction to Computer Technology ................... 1050 B. "Writing" Application Programs ......................... 1051 1. The design of computer-human interfaces ............... 1053 2. Software engineering ................................ 1055 3. The process of technological advancement in application programming....................................... 1057 II. AN ECONOMIC FRAMEWORK FOR ANALYZING LEGAL PROTECTION FOR APPLICATION PROGRAMS .................. 1058 A. Innovation in Application Programmingas a Public Good .... 1059 1. The role of legal protection in remedying the public goods problem ........................................... 1059 2. Assessing the need for legal protection .................. 1060 3. Balancing the costs and benefits of legal protection ....... 1065 B. Network Externalities-FosteringStandardized and User- Friendly Computer-Human Interfaces ...................... 1066 1. The negative effects of legal protectionfor computer-human interface standards on the realization of network externalities ........................................ 1067 2. The positive effects of legal protectionfor computer-human interface standards on innovation in and adoption of improved interfaces .................................. 1070 III. ANALYSIS OF THE SCOPE OF LEGAL PROTECTION FOR APPLICATION PROGRAM CODE ............................... 1071 A. Modes of Legal Protectionfor Application Program Code ..... 1072 1. Copyright .......................................... 1072 2. Patent ............................................ 1074 * Associate Professor of Law, Georgetown University Law Center. S.B., Massachusetts Institute of Technology, 1980; J.D., Harvard Law School, 1986; Ph.D., Stanford University, 1986. I am grateful to Doug Baird, John Barton, Tim Brennan, Jeff Cunard, Joe Farrell, Paul Goldstein, Gillian Hadfield, Dennis Karjala, Ken Leffler, Steven Lundberg, Steve Salop, War- ren Schwartz, and participants in seminars at the University of Chicago Law School, Ge- orgetown University Law Center, Stanford Law School, and Yale Law School for comments on an earlier draft. I also owe thanks to Renee Brooker and Peggy Kelsey for excellent re- search assistance. This research was supported in part by a grant from the John M. Olin Foundation to Stanford Law School. I am solely responsible for the shortcomings of this work. 1045 HeinOnline -- 41 Stan. L. Rev. 1045 1988-1989 1046 STANFORD LAW REVIEW [Vol. 41:1045 3. Other modes of legal protection ........................ 1077 B. Evaluation of Current Protectionfor Application Program Code ................................................. 1079 1. Economic analysis of legal protectionfor application program code ....................................... 1079 2. Evaluation of the current direction of legal protectionfor applicationprogram code ............................. 1082 C. Toward a Better Standard of Copyright Protection of Application Program Code ............................... 1084 IV. ANALYSIS OF THE SCOPE OF LEGAL PROTECTION FOR COMPUTER-HUMAN INTERFACES ............................ 1088 A. Modes of Legal Protectionfor Computer-Human Interfaces ... 1089 1. Copyright.......................................... 1089 2. Patent ............................................ 1091 3. Other modes of legal protection ........................ 1092 B. Evaluation of Current Protectionfor Computer-Human Interfaces ............................................. 1092 1. Economic analysis of legal protectionfor computer-human interfaces .......................................... 1093 2. Evaluation of the current direction of legal protectionfor computer-human interfaces ........................... 1096 C. Toward a Better Standard of Copyright Protectionfor Computer-Human Interfaces ............................. 1098 V. CONCLUSION ............................................. 1103 Computer software, by its very nature as written work intended to serve utilitarian purposes, defies easy categorization within our intellec- tual property system. The copyright law has traditionally served as the principal source of legal protection for original literary work, while the patent system and trade secret law have been the primary means for protecting novel utilitarian works. Faced with the difficult challenge of fitting computer and other new information technologies under the ex- isting umbrella of intellectual property protection, Congress in 1974 established the National Commission on New Technological Uses of Copyrighted Works (CONTU) to study the implications of the new technologies and recommend revisions to federal intellectual property law. 1 After conducting extensive hearings and receiving expert reports, a majority of the blue-ribbon panel of copyright authorities and interest group representatives comprising CONTU concluded that the intellec- tual work embodied in computer software should be protected prind- 1. Act of Dec. 31, 1974, Pub. L. No. 93-573, § 201, 88 Stat. 1873. CONTU's mandate was to study and make recommendations concerning the implications of photocopying and computer technologies for the authorship, distribution, and use of copyrighted works. See generally NATIONAL COMMISSION ON NEW TECHNOLOGICAL USES OF COPYRIGHTED WORS, FINAL REPORT (1979) [hereinafter CONTU REPORT]. HeinOnline -- 41 Stan. L. Rev. 1046 1988-1989 May 1989) COPYRIGHT OF PROGRAMS 1047 pally under copyright law, 2 notwithstanding the fundamental principle that copyright cannot protect "any idea, procedure, process, system, method of operation, concept, principle, or discovery." 3 Congress im- plemented CONTU's recommendation in its 1980 amendments to fed- 4 eral copyright law. In light of the computer software industry's relative youth and antic- ipated rapid growth,5 CONTU's rough empirical judgment that copy- right would best promote the invention, development, and diffusion of new and better software products was, by necessity, highly speculative. As CONTU recognized, it was impossible in 1978 to establish a precise line between copyrightable expression of computer programs and the uncopyrightable processes that they implement.6 Yet the location of this line-referred to as the idea/expression distinction 7-- was critical to the rough and highly speculative cost-benefit analysis that guided CONTU's recommendation. Drawing the line too liberally in favor of copyright protection would bestow strong monopolies over specific ap- plications upon the first to write programs performing those applica- tions and would thereby inhibit other creators from developing 2. See CONTU REPORT, supra note 1, at 1. But see id at 27-37 (Commissioner Hersey, dissenting) (arguing that "forcible wrenching" would be required to protect computer pro- grams under the copyright law); iL at 37-38 (Commissioner Karpatkin, dissenting) (same); cf. id at 26-27 (Commissioner Nimmer, concurring) (warning that CONTU recommendations might take copyright law "beyond the breaking point," converting it into a general misappro- priation law). See generally Pamela Samuelson, CONTU Revisited- The Case Against Copyright Pro- tection for Computer Programs in Machine-Readable Form, 1984 DUKE .J.663. 3. Copyright Act of 1976, 17 U.S.C. § 102(b) (1982). 4. Act of Dec. 12, 1980, Pub. L. No. 96-517, 94 Stat. 3007, 3028 (codified at 17 U.S.C. §§ 101, 117). 5. Just in the decade since CONTU issued its recommendations, revenues in the com- puter software industry have grown from $10 billion in 1978 to a projected $53.6 billion for 1988. See COMPUTER & BUSINESS EQUIPMENT MANUFACTURERS ASSOCIATION, THE COMPUTER BUSINESS EQUIPMENT, SorrWARE, AND TELECOMMUNICATIONS INDUSTRY 1960-95, at 9 (1986) [hereinafter CBEMA DATA] (all figures in 1986 dollars). 6. See CONTU REPORT, supra note 1, at 22-23. Yet CONTU was aware that difficulties in drawing this line might lie ahead: "Most infringements, at least in the immediate future, are likely to involve simple copying. In the event future technology ...permits future infringers to use an author's program without copying, difficult questions will arise." Id at 22. 7. In order to prevent copyright from occupying the proper domain of patent law, the courts have limited copyright protection to the expression of an idea and not the underlying idea itself. The leading case establishing this principle is Baker v. Selden, 101 U.S. 99 (1879). In Baker, the plaintiff, Selden, owned a copyright in a book describing a new accounting sys- tem. The book contained blank forms for using the system. Baker subsequently published books that described a similar bookkeeping system. The Supreme Court held that Selden's copyright extended only to his expression of the system and not to the system itself. There- fore, the copyright did not extend to the blank forms which contained no expression beyond the basic organization of the accounting system. In the Court's view, "[t]o give the author of the book an exclusive property in the art described therein, when no examination of its nov- elty has ever been officially made, would be a surprise and a fraud upon the public. That is the province of letters-patent, not of copyright." Id. at 102. This principle is codified in sec- tion 102(b) of the Copyright Act of 1976. H.R. Rep. No. 1476, 94th Cong., 2d Sess. (1976), reprintedin 1976 U.S. CODE CONG. & ADMIN. NEWS 5659, 5667. Courts applying this principle have withheld copyright
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