July 6, 2005 6:12 AM PDT

Europe rejects patent proposal

The European Parliament has rejected a controversial measure that would have legalized software patents in the European Union.

A government representative said that 648 out of 729 members of the European Parliament voted Wednesday to reject the proposal, called the Computer Implemented Inventions Directive, which would have widened the extent to which software could be patented .

The Foundation for a Free Information Infrastructure, or FFII, described the decision as a "great victory for those who have campaigned to ensure that European innovation and competitiveness is protected from monopolization of software functionalities and business methods."


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While many software developers have spoken out against the directive from the start, large companies have lobbied in its favor, often via campaign groups such as the Business Software Alliance, CompTIA and the Campaign for Creativity.

These groups and the companies behind them, such as Microsoft and IBM, have put significant money and effort into arguing their cause.

The future of the directive is currently unclear. It is possible that a revised version could be debated in the future. But back in March, Charlie McCreevy, a member of the European Commission, said the Commission would not resubmit a new directive if the Parliament chose to reject the current version.

Ingrid Marson of ZDNet UK reported from London.

22 comments

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"software functionalities and business methods"
>>> ""a "great victory for those who have campaigned to ensure that European innovation and competitiveness is protected from monopolization of software functionalities and business methods."">>>. Does the European Union even have a significant software industry to talk about in the first instance! Moreover, with the global focus on offshore outsourcing to countries such as India in order for companies in countries such as the United States to achieve low-cost production in software development and manufacturing... one should ponder the relevance of so-called "Computer Implemented Inventions Directive" within the context of the wider global economy around which systems --- among others, like the educational, scientific and social systems revolve.
Posted by (187 comments )
Reply Link Flag
One big one
SAP, 3rd or 4th largest I think. Other than that, I do not know of any important ones.
Posted by (61 comments )
Link Flag
Linux
Linus Torvald's contribution to IT is having pretty significant effects to the industry. And there's a good number of engineering firms producing embedded software that users might never see, but forms a significant industry in its own right.
Posted by (2 comments )
Link Flag
Ignorant
Hello. Half the apps you use on your PCs are developed in Europe. Not everything is American you know.
Posted by (79 comments )
Link Flag
But It Does Matter
This decision on software patents does matter BECAUSE OF the relevance of Europe's software sector. Many regions such as Germany and Scandanavian countries are seeking to promote innovative technologies such as major Linux rollouts and networking technologies such as mobile technologies.

As for offshoring, some European are major offshoring destinations. With further expansion of the EU to introduce less well off countries under the EU umbrella this will increase - with many talented programmers located in Eastern Europe.

With the scourge of this legislation relieved, for now at least, Europe can think about a software industry which is not dominated by lawyers and patents but instead about the software. Programmers will be happier to know that they work in an economic block where they are protected from corrupt blocking measures enforced through patents.
Posted by (2 comments )
Link Flag
"a loss for many large companies" ?
First, I concur with the previous poster that
Europe doesn't have a comparatively large
software industry per se, but I wouldn't go
quite as far as counting it as irrelvelent. It's
true that US companies do a lot of outsourcing,
but it's not quite as common elsewhere.

I do question the statement that the decision is
a "loss for many large companies". In fact, the
majority of large companies are consumers and
not vendors of software. For them, the decision
eliminates one source of lurking liability. For
those that produce software, but not as a
primary business, the directive reduces the cost
of producing software as a value-add to their
own products (diminished licensing costs, fewer
patent searches and lawyers involved). And for
large software companies, it eliminates
potential liabilities lurking in their own
products and permits adoption of "standards"
without worrying about encumberment (which means
greater interoperability, lower cost, more value
for the customer).

The only time patent coverage of software
implementations would make business sense would
be to secure a monopoly on a market segment, and
that requires enough captial to purchase patents
that impinge on your own business objectives.
Very few companies have the desire or ability to
really do that.

So, kudos to the EU. Assuming that patentability
of software in the US continues to make a
mockery of the USPTO, I think this will prove to
be a tremendous shot in the arm for the European
software industry.
Posted by Gleeplewinky (289 comments )
Reply Link Flag
To Benefit U.S. Tech
No patent protection in Europe will diminish incentive to innovate and, like open-source, will facilitate the copying of tools between businesses.

Companies that are looking for better tools than their competitors will increasingly turn to U.S. technology suppliers who will be better able to afford the research and development necessary to build better software.

<a class="jive-link-external" href="http://www.inaniloquent.com/PermaLink.aspx?guid=475e5dcf-cbb2-45ff-871f-04c975ea0047" target="_newWindow">http://www.inaniloquent.com/PermaLink.aspx?guid=475e5dcf-cbb2-45ff-871f-04c975ea0047</a>
Posted by William Squire (151 comments )
Reply Link Flag
On what basis?
On what basis do you say incentive to innovate will die? We don't have software patents here currently, and yet innovation still occurs. I work for a US software firm, and I can assure you that much of our work and that of our competitors is derivative. For many products, we rely on contributions from other countries such as Slovenia. These independent software houses identify their own market requirements and specs.

Moreover, if you read up on the patent discussion you would see many software business (including well established ones such as Autodesk) stating that their own patents have never been anything but a wasteful legal necessity. Microsoft would never have become as successful as it is, had Xerox patented the windows metaphor for GUIs.

People who provide new ideas will do so anyway, they don't need legal crutches to do so. When the US put a man on the moon - it wasn't because the opportunity for patents that took them there.

As for the knee jerk socialism comment on your blog, I simply pity you. Presumably you don't get to see much of the world outside the US?
Posted by (2 comments )
Link Flag
Now lets do it here
Now its time to deal with the patent system here in the US so that such concepts as 'hyperlinking' cant be patented.

But I wont hold my breath.
Posted by (402 comments )
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Strange Dichotomy!
Isn't it a strange dichotomy that -- not so long ago it was the same EU that extracted in excess of $600,000,000 from Microsoft Corp. (a US based proprietary software manufacturer) within the pretext of monopolistic practices by this company now finding itself now rejecting a measure intended to legalize software patents in the European Union and having also demanded that Microsoft disclose information to rival server-software makers that would allow them to design products compatible with Windows. The question is -- if the European Commission has extracted this large sum of money from a US based proprietary software manufacturing company and have also demanded the disclose of software-based intellectual property... why then should the world not have fairly unrestricted access to technologies invented in Europe.
Posted by (187 comments )
Reply Link Flag
Huh?
Did you understand anything in that article? The EU DENIED software patents! That means the technology IS freely available here and elsewhere as long as you don't violate copyright. The EU is simply being consistent in its stance against monopolies.
Posted by Michael Grogan (308 comments )
Link Flag
It will return, just as obnoxious as ever
Remember, various EU constituent member countries kept voting it down to kill it but the steering committee ignored all the negatives and bypassed these bill kill vetoes. Next you'll see it rise in another guise, and/or appended to another more innocent EU regulation!
Posted by heystoopid (691 comments )
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Probably
Since Microsoft is forming "strategic alliances" (read: bribes) with more and more countries, the abovementioned scenario is very likely. Money has a way of bending the minds of normally rational people.
Posted by (92 comments )
Link Flag
This story has been rather inaccurately reported
What many people do not realize is that software patents already are available in countries of economic consequence in Europe.

Currently, the European Patent Office (EPO) provides a common patent examination system for the major European countries and they accept patent applications directed towards software. The member states of the EPO does not include every member of the EU. If the EPO approves of a software patent application, the applicant then has the option of obtaining individual countries patents for each country that is a member of the EPO.

The defeated EU software patent proposal would have provided for the EPO to still do the examination but then any issued patent would be an EU-wide patent - something that currently does not exist.

Practically speaking, even if the EU software patent bill had been passed, the proposal would have required any issued patent to be translated into each language of each EU country - about 25 languages. This would have been extremely cost prohibitive to most companies except for relatively larger ones.
Posted by jkudla (5 comments )
Reply Link Flag
Indeed
Even if I could argue against some parts of Michel Rocard's proposal (which is mainly reasserting EU Parliament's amendments from the votes back in 2003), I took it as an acceptable balance between diverse aspects of the question. A good compromise.
While I'm thoroughly relieved by the rejection of the project as it was proposed, I feel that the adoption of its correctly amended version would have leaded to a far safer situation than the current one.
Anyway, better no directive than a bad directive, isn't it ?
Posted by (1 comment )
Link Flag
Exactly...
"Practically speaking, even if the EU software patent bill had been passed, the proposal would have required any issued patent to be translated into each language of each EU country - about 25 languages. This would have been extremely cost prohibitive to most companies except for relatively larger ones."

Sounds perfect. Isn't this the central theme of software patents - be prohibitive to most companies except for relatively larger ones!
Posted by (2 comments )
Link Flag
Business Method and Computer Software Patents
"Under the European Patent Convention and the patent laws of a number of countries members of the European Patent Organisation, computer programs and business methods as such are still expressly excluded from patent protection." Quite interesting one should think! (please see attached link): <a class="jive-link-external" href="http://www.wipo.int/sme/en/e_commerce/computer_software.htm" target="_newWindow">http://www.wipo.int/sme/en/e_commerce/computer_software.htm</a>
Posted by (187 comments )
Reply Link Flag
 

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