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Gowers Review of Intellectual Property

The Gowers Review of Intellectual Property is an independent review of the UK's laws on copyright, trademarks, patents, and related rights. The review was commissioned in December 2005 by the UK government's Chancellor of the Exchequer (at the time, Gordon Brown) and carried out under the direction of Andrew Gowers. A public consultation was held (a "call for evidence") between February and April 2006. The review was published one year later, in December 2006.

The most substantial comments on software patents in this report are pages 75 & 76 in the paragraphs tagged 4.114 to 4.119.

Use of the term intellectual property is unfortunate, but the report generally takes the correct approach and analyses each set of laws separately (patents, copyrights, designs, trademarks, etc.).

Sections 4.114 to 4.119

4.114 There have been calls in the UK to introduce pure computer software patents to ensure that innovation is properly protected and encouraged. In Europe, patents are not granted for computer programs as such,87 but patents have been granted to computer-based innovations provided they have a technical effect. In the USA, pure computer software patents can be granted. The evidence on the success of pure computer software patents is mixed. The software industry in the USA grew exponentially without pure software patents, suggesting they are not necessary to promote innovation.88 The evidence suggests software patents are used strategically; that is, to prevent competitors from developing in a similar field, rather than to incentivise innovation.

4.115 In addition to the concerns that increased protection does not increase incentives, some have commented that pure software patents do not meet the criteria for patentability. The most profound problem with using patent law to protect software is that innovation in the field is usually accomplished in increments too small to be viewed as inventive steps. Several submissions to the Call for Evidence, for example the Professional Contractors Group’s submission, argued that software should not be patentable in principle. Where freelance businesses develop software, they rely on copyright to protect it. This protection is free and automatic. The copying of as little as 1.7 per cent of a program’s code has in the past been found to be infringement of copyright.

4.116 Introducing pure software patents could raise the costs for small software developers to mitigate against risks surrounding R&D, thereby inflating the capital needs of software development. Sun Microsystems argued that without exceptions that allowed for reverse engineering for interoperability, pure software patents could stifle competition.

4.117 Last year, the European Parliament rejected the Computer Implemented Inventions Directive, but this issue has been raised again. The economic evidence suggests that such patents have done little to raise incentives to innovate, and other evidence suggests that the introduction of such patents will have a chilling effect on innovation. In the absence of such evidence, a new right for pure software patents should not be introduced, and so the scope of patentability should not be extended to cover computer programs as such.

4.118 The Review is concerned that business method patents fail to meet the criteria for patentability; namely that inventions are non-obvious and novel. In Europe, business methods are not patentable as such, while in the USA business models are patentable.

4.119 There is some evidence from the USA that patents on business methods are not necessary for incentivising innovation, and that the costs to develop business methods are low and therefore the products ought not to qualify for a full term of patent protection. There are additional practical concerns with increasing business method patents. In a 2001 consultation, the Patent Office reported that SMEs were particularly concerned about business method patents potentially increasing the regulatory burden.

Other excerpts about software patents

  • "Recommendation 17: Maintain policy of not extending patent rights beyond their present limits within the areas of software, business methods and genes.", page 7
  • "Copyright subsists in a wide range of creative or artistic forms or ‘works’, including poems, plays and other literary works, movies, choreographic works, musical compositions, audio recordings, paintings, drawings, sculptures, software, radio and television broadcasts.", page 12, just a little interesting to note that the report categorises software as "creative/artistic".
  • "new technologies such as genetics, software and databases require IP protection but do not fit easily into existing categories.", page 24
  • "Recent attempts to agree a Directive to harmonise the law relating to software patents was rejected by the European Parliament in response to fears about the negative implications that a US-style system for software patents would have on innovation.", page 31
  • "The patentability of software remains contested, with applications required to prove a ‘technical effect’, but this does not appear to have had a significant negative effect on industry innovation.", page 35
  • "In simple technologies, 28 per cent of firms use patents as a trading strategy to licence a technology, while 46 per cent use patents to fence off an area to competitors and provide more intellectual ‘space’ to innovate.4 This strategy can be problematic in areas where thousands of patents are used in the design of new products, especially in the electronics and software industries.", page 38
  • "There are concerns that a ‘one size fits all’ patent system may not provide the right incentives to innovate in new areas of technology, such as software and genetics. Many fast-paced industries create new products at high speed, so the time it takes to get patent protection is too long and the life span of the invention is too short for the costs to be recouped in the monopoly period. The boundaries between patentable and unpatenetable business methods and computer programmes are very unclear.", page 74

(For the relevant parts of pages 75 & 76, see above.)

On page 79, a table suggests possible work sharing with Japan and the USA. Regarding patents, is suggests that work can be shared regarding the criteria of novelty, inventive step, and industrial application, but not regarding patentable subject matter.

Calls for evidence

A "Call for evidence" consultation was published on February 23rd 2006 and accepted submissions until April 21st 2006. See page 129 onward of the PDF document.

Related pages on ESP Wiki

External links