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Preventing Software Patents: How & Why (2005-11-18)

This is a transcript of the opening presentations and the common questions and answers session from an event held on 2005-11-18 at the European Union offices, 43 Molesworth Street, Dublin, Ireland. The panelists taking questions from the audience were Ciarán O'Riordan (IFSO/FSFE), Gareth Bowker, and Ger Gibbons (assistant to MEP De Rossa). The event was organised by Irish Free Software Organisation, and hosted by the office of MEP Proinsias De Rossa. This transcript was made and proof-read by members of IFSO and its faithfulness can be checked against the audio and video recordings which are also available. If you do find any errors or discrepancies, please send corrections to the webmaster.

Presentation by Ciaran O'Riordan

[Section: What will be covered]

I'm talking about the re recently-rejected Software Patents Directive, so the things I want to cover are:

I'm not going to speak just for myself saying that I think we are better off now, I'll say what players were involved that think we're better off now that the Directive has been rejected.

(go to menu) [Section: EU citizens and EU politics]

Before I start talking about the details, one thing that has to be realised is that people in Europe, the citizens, very rarely actually take part in European politics.

It is something that happens over in Brussels, it's something we don't participate very actively in - very few of us do. And also, software patents is a very obscure subject.

The MEPs noticed this. It requires understanding of patents, understanding of software development, understanding of software businesses.

So it's an obscure subject, and yet we got thousands of people to travel to Brussels to meet the MEPs, for protests and rallies near the Parliament. People got really involved in this, so that's an indicator that this topic deserves special attention.

(go to menu) [Section: Why we can be happy]

I'm going to talk about why Europeans should be happy: the Software Patents Directive, it's no more.

The original version of this Directive would have introduced software patents into the European Union. Now, we've gotten this Directive rejected, but the problem has not been solved completely because the the European Patent Office is still handing out software patents.

So this problem will come back at some stage in the future, so we're going to have to continue to build awareness on this and related topics.

[2:28]

Who says we should be so happy?

First off the United States of America told us that software patents are a bad idea. They mightn't always have good advice on how to run a European economy, but the way they told us is that they have software patents, in the United States, so we are able to look at the United States, and see how the patent system has worked for software. See what effects it had had in practice - we can take them as an example, and decide: do we also want to do this to our economy.

Representatives of European Small- and Medium-sized Enterprises were quite conclusive that software patents were going to be a very bad idea.

Consumer groups told us it would be a bad idea.

Free software organisations, such as Irish Free Software Organisation, Free Software Foundation Europe, and Free Software Foundation - based in North America since the 80s - they've all agreed that software patents would be a very bad idea.

(go to menu) [Section: The FTC report in the USA]

For the USA, the best summary is the Federal Trade Commission.

The Federal Trade Commission is like the Competition Authority in Europe, so they're not tied to any company, they're not tied to any specific type of business model, their job is not to promote anything in particular.

Their job is to make the economy and the market function. They monitor interstate trade in the US and find out what the problems are.

In 2003, they published their "Report on Innovation", which was a 350 page report about the patent system - every aspect of the patent system in the USA.

They had a section about software patents. "Software and Internet" patents they called them, and for the harm to software users and the software industry, they listed:

By requiring patent licences to build on-top of other software, or to build related services, it makes it hard to build related industries.

Both through the costs of the patent system, or the risks involved in the patent system.

If you want to invest in a company - there's not way to tell if a company already infringes a patent. You don't know until somebody sends you a letter saying "you infringe our patent, please cease and desist distributing your software". This uncertainty makes it difficult to invest in a company because your investment is going to draw the attention of software patent litigators.

When there is a new area of development, a lot of companies rush to get a patent on this area of development, so this leads to a number of different companies, each having separate patents on the same area. So if anyone else wants to work on this area, they have to get a licence off several different companies or one company that owns a large number of patents that simply can't be avoided.

[5:52]

"Defensive patents" is where a company acquires patents, so that they can counter-litigate when they are litigated against. This is for companies that don't actually intend to use their patents aggressively, but in a way they pay a patent tax - but this also increases the number of patents in existence, so that makes the patent thickets worse.

The US Federal Trade Commission also said that

This is funny because some people that argued in favour of software patents said that it increases research and development because it provides a way to get funding for this, but the US Federal Trade Commission says that the opposite is true.

The report says they:

If you develop a piece of software, you don't know if it already infringes a patent. You can publish your software, and only after the software becomes popular, a patent holder can say "oh, by the way, we have a patent on that idea". A patent lasts for 20 years, so they have 20 years to decide when to enforce it against you.

The report also said that it was:

Again this is about putting money into a company when you don't know... When a company has no money, it will rarely get sued for patent infringement, since there is nothing that can be gotten out of the company, but when a company receives investment, it becomes a target. Most companies start out as a small business, then you get funding and become medium, and in the end hopefully you'll become a large company. So this impedes the normal company growth process.

This is where people develop a product and then they can't release it into the market because somebody claims, rightly or wrongly, that they have a patent on this piece of software.

Also:

So those are the bad points.

[8:25]

Of course, the US FTC report also would have looked at the redeeming qualities. If you have all these costs, what's the point in having patents? For the redeeming qualities, ...they actually had nothing. The entire conclusion was negative.

This wasn't a report just on software patents, this wasn't a response to anything in particular, and they didn't have an axe to grind, but simply for software they found that their was no benefit.

So that's the US.

[9:00]

(go to menu) [Section: Jobs in the EU]

In Europe, one thing that interests a lot of people is: jobs.

The majority of jobs Europe, I think it's about 75%, are provided by Small- and Medium-sized Enterprises. Each country, each member state has a union, or several unions, that small and medium enterprises can join. In the EU there is a kind-of central union that these union are part of. This union is called UEAPME. UEAPME represents 11 million companies, which employ 50 million Europeans. They said that:

"Small firms are concerned that introducing patents for software would seriously limit their ability to be innovative and endanger their survival."

So this is 50 million jobs that are represented, and they're anti-software-patent.

[10:00]

(go to menu) [Section: What consumer groups said]

Consumers as well, have said:

"The proposal as it stands will severely inhibit competition (and thus innovation) and will have many negative consequences for European consumers"

That statement was made by BEUC, which is similar to UEAPME in that it's an umbrella union for the consumer groups in the various member states.

[10:25]

(go to menu) [Section: Free software]

Free Software groups have been working on this for years. Richard Stallman, who started the free software movement back in 1983, he compares software patents to landmines, he says:

"Software patents are the software project equivalent of land mines: each design decision carries a risk of stepping on a patent, which can destroy your project."

Stallman is a notable software developer himself, but at the moment he does mostly political work.

[10:40]

(go to menu) [Section: The European Parliament]

So, to the European Parliament.

The software patents directive was brought to the European parliament in around 2001. The reason, the justification, was: harmonising the patent law in the EU, but actual consequence of the Directive was to validate, to legalise software patents.

It was a very difficult topic, as I said, it required knowledge of patents, software development, and software business - so the Parliament differed the vote on this a number of times, and eventually in 2003 they went to vote on it.

When they did vote on it, they voted for a set of amendments, and it was a very clear set of amendments which clearly excluded software from patentability.

Not only did the amendments get adopted, but they were adopted by majorities of around 75%, so it was a very clear signal from the Parliament.

[12:00]

Then in the second reading, which happened this year, we were expecting roughly the same again, but those advocating software patents, they changed their line.

Instead of pushing for "software patents", they were going to say "This isn't about software patents, this is about 'Computer Implemented-Inventions'".

(go to menu) [Section: What are computer-implemented inventions?]

This term... What is a "computer implemented invention"? What is "implemented" on a computer, other than software? It's a strange term. It sounds like an invention that involves a computer, or it sounds like a mechanical invention, but it is a replacement term for software patents.

We can tell this because when they changed the term, they then proceeded to lobby for the exact same old idea, which would have allowed software to be patentable, under the new banner of "CIIs".

[13:00]

This did confuse some MEPs. There was a very large lobbying campaign, on both sides, and some MEPs were left in doubt, they didn't know who is accurate.

The line of "This isn't about 'software patents', this is about 'CIIs'" - this was a very hard line to keep straight, because it's just so contradictory. One example was, even the the Business Software Alliance, which was strongly pro-software-patent, near the second vote, they published a study, which started off:

"...computer-implemented inventions [are] usually referred to as 'software patents' in United States..."

This is completely contradicting their message.

Another piece of good fortune was, a company called SAP - which is a rich software company that makes database related products - two weeks before the big vote, while the pro-software-patent camp were saying "This isn't about software patents", SAP published full-page ads in a few prominent European newspapers.

Of course, SAP doesn't actually make anything other than software, so when MEPs said to us "This isn't about software patents" - we could show them this full page ad and here's a very large company that makes nothing but software, why are they pushing for these patents?

So that's what the other side were saying.

[14:19]

(go to menu) [Section: Our message:]

What were we saying? What we were asking for was a requirement in patentability to be based on "forces of nature" or "applied natural science". These were phrases from other countries that don't have software patents - this is how they're excluded.

Under our amendments, an idea would be patentable if it involved a new teaching in forces of nature, or if the innovation was in applied natural science.

So I'll just give an example of what would, and what wouldn't, fall within that definition.

[15:00]

(go to menu) [Section: Anti-lock Braking Systems, ok]

Anti-lock Braking Systems. This was a famous example in the Parliament:

Cars contain sensors, they contain brakes, they contain a lot of computers, so if a car manufacturer develops a new way to slow down a car - and if they don't have to change the sensors and they don't have to change the brakes - if the change is in the software, is this a software patent?

It's not a software patent, so it would be valid. The reason is that the innovation involves how brakes are used, so it's a new teaching in applied natural science or forces of nature. So anti-lock braking systems will still be patentable.

(go to menu) [Section: XML file formats, not ok]

Something that wouldn't be patentable, under our rules, is XML or computer languages. For computers to talk to each other, they have to speak a common language. So if I develop a new language, or a new way of using an old language: would that be patentable?

Under our amendments, no that wouldn't be patentable, because there are no forces of nature and there is no applied natural science.

[15:55]

(go to menu) [Section: How patents can be useful in some fields]

Why should ABS be patentable, and software for computers to talk to each other not be patentable? I'll look at the costs and benefits of patents for software: Patents inhibit development.

That sounds like a negative thing to say, but that's actually the goal of patents, they also inhibit the combination of ideas. I'm not criticising that.

In the automotive field, these restrictions, they only affect people who have car manufacturing facilities - this is a restriction on a very small number of people. It's an industrial regulation - it's no a restriction on the general public.

In contrast, in the software field, anyone can learn to write software, anyone can hire someone to write software - it's not an expensive thing to do.

People who develop their websites, like most of the MEPs have, are software developers. We actually found during the campaign that most of the MEPs did actually infringe software patents that were already handed out by the European Patent Office - but they weren't currently valid. If this directive made software patentable, most of the MEPs would have become infringers.

So the costs, when it's applied to software, is on a much greater scale - it's applied to every individual.

[17:31]

I said that patents "inhibit development", but that that's not a flat criticism of the patent system. The reason for this is that patents try to encourage what's called "lateral innovation".

You put a block in the way of one path, then people have to find a new way of doing something, and if enough paths get blocked off, eventually people will find new more efficient ways of doing the same thing.

(go to menu) [Section: Why software doesn't benefit]

But the problem is that for software, this doesn't really work. If I want to send documents to a friend, my documents have to be in the same format that my friend can read. If I develop a super new format, and it's completely more efficient, and it's more detailed, but my friend can't read it - my format is pointless.

My lateral innovation, it's like a four pin plug. There's no point in having this thing.

[18:35]

As for the benefits of the patent system. For software, the benefits are not divided evenly, they're disproportionate.

If a market leader says "I own this data format, nobody can use this data format" then people trying to compete against the market leader are going to have a very hard time because not only do they have to produce better software, but they also have to get every company to switch over to this new data format.

We've seen in the way word processors and webpages clump together on single technologies - it's called the network effect.

If who is not the market leader has a patent, for example, if I have an application, and not many people use it, yet, and I get a patent and say "ok, nobody's allowed to copy my format", nobody cares.

The market leaders will continue their current development. They're not trying to compete against me, they don't want access to my technology, my technology is not being used by the market and their technology is being used by the market. Market leaders benefit, while it hurts competition.

Exclusionary tools, like as patents, are only of benefit to those who are large enough, and established enough to be self-sufficient.

[20:01]

In this way, because of The Network Effect, patents in software specifically inhibit the development of useful software.

If I want to write a new word processor to compete with the market leader, it has to look like a word processor, it has to behave like people expect a word processor to behave, it has to read and write the file format of the current market leader, the word processor that people are already using.

If my word processor is 100% innovative and doesn't copy anything from the predecessor - if it doesn't build on the old - it won't be a word processor.

(go to menu) [Section: Parasites and zombies]

We can see these costs and benefits, we can see the scenario already played out in the USA, we can just look across. They have a new phenomenon, we're now seeing "patent licensing firms". I call them Patent Zombies, I'll say why later.

This is a new type of software business model that involves staying as far away from software as possible. We're now seeing patent licensing firms buying all these old patents from the dead and dying dot-com companies and basically hunting software developers - looking for licensing fees from companies that are actually producing software.

It's a smart model. The plan is, if patents make software development risky, and if they let you hold others to ransom, then the safest option is to not develop any software.

I call them zombies because they harvest the dead and dying. Others call them parasites because they live off the profits of real companies that are producing something for society.

[22:36]

(go to menu) [Section: Current status, November 2005]

We did a lot of work on this, this was one of the most important projects in the free software movement in the last few years and afterwards we've come out fairly well.

We don't have a complete victory, but we've proved that we can have an effect. A lot of people thought that the political system would be so stacked against us, because we weren't used to working within the political system - they thought that it was so stacked against us that there was no point in even trying.

We figured out the legislative process - that was pretty difficult, it was a big barrier, just trying to figure out who has the power at a given time and what can they be asked to actually do.

We have got experience of working within the process, and we now have people in Brussels, and we have national free software organisations.

(go to menu) [Section: Bigger picture, inhibiting free software]

We were working on software patents, but this wasn't exclusively about software patents. Software patents are part of a bigger picture: Creating barriers to participation in the development and distribution of software.

[24:09]

Who would want to make barriers to participating in the development of software?

If you consider market leaders and those with large market shares - people who can only stand to lose from competition, or they're possibly losing market share at the moment, to small and medium sized companies, or to companies that are based on free software. What these big companies have to figure out, is what do they have, that they can use, that smaller companies don't.

That's money and lawyers.

So the key to maintaining their market share, is finding ways to make software development require money and lawyers.

(go to menu) [Section: The influence of SMEs]

In the second reading, the MEPs were contacted by some small and medium sized enterprises, and they were told "Us small and medium enterprises, we want software patents".

This was kinda confusing to the MEPs. Some started to believe that SMEs were on both sides of the debate, and that some small companies wanted them and some didn't. But why would a small company argue for software patents?

They could want to work with the larger companies, they could be dependent on larger companies, they could even have business models based on the zombie model I mentioned earlier. But UEAPME, representing 11 million SMEs, clearly spoke against software patents. The SMEs were actually the largest lobby group in this issue.

The free software movement also participated on a large scale, but most of it was SMEs. Basically what SMEs want is to be able to compete in the market, they want to be able to enter the market, and they want to have options for procuring software, they want to have choice.

Free software often allied itself with small and medium enterprises because reducing the barrier to entry is something we both benefit from. That's the bigger picture: it was not just about free software, it was about the freedoms revolving around free software. It was about software independence or software freedom.

[27:27]

One of the largest lobbying groups was FFII. They did a lot of the coordinating work, they did a lot of organising of events for the anti-software-patent campaign.

(go to menu) [Section: FFII, IFSO, and FSFE]

FFII is not a free software group, but they are an associate organisation of Free Software Foundation Europe - like the way Irish Free Software Organisation is.

Their goal is, what they call, a free information infrastructure. This is compatible with our goal pursuing permission to write, use, and distribute free software.

FSF Europe didn't always work directly on this issue. Back in 2001, free software wasn't as prominent, and if this issue got painted as a free software issue - for building a coalition, it would have been harder to get the proprietary software companies, who are equally harmed by software patents.

So FFII worked with free software organisations, it worked with the small and medium enterprises.

We have some free software companies here, we probably have a lot of free software users, but maybe there are some people who aren't too familiar with free software.

The flagship project is the GNU/Linux operating system. It's possibly the second most used operating system. It's certainly used by 10s of millions or 100s of millions of people.

One fairly popular piece of software we have is the Mozilla Firefox web browser - a lot of people are starting to use this, even without knowing that it is free software.

There's the OpenOffice.org office suite, this is a word processor, a spreadsheet, a presentation program, this sort of thing.

Large companies can develop software whether there are software patents or not. Smaller companies find it more difficult to carry the costs. Free software is indirectly discriminated against by this directive because free software mostly relies on the contributions of small companies, medium sized companies, companies whose core business is something other than software, and even individuals and college students. A lot of people contribute to free software because there is no barrier to entry.

Some packages of free software are written by very large companies, but it's not the majority.

I mentioned the consumer organisation earlier, BEUC. About free software, they say that "Open source and free software provide consumers with more choice than ever before, and empowers the creative users to participate in future development of these products"

Free software is now being recognised by consumer groups, by small and medium enterprises.

In Irish Free Software Organisation and Free Software Foundation Europe, we try to promote free software, but we find that the software does a fairly good job of promoting itself. Our focus is on the political side, trying to ensure that legislation doesn't inhibit the development of free software.

Larger companies tend to have lobbyists and advertising departments, these are two things that free software doesn't have very much of, so we need to build up our weaker points, because this is where we will have problems. That's why IFSO doesn't develop software, we try to make sure that everyone else can develop software.

We have CDs down the back of free software, and that's just one of the values of free software, everyone can walk out with a copy at the end of today. It has the GNU/Linux operating system, the Mozilla Firefox web browser, the OpenOffice office suite.

(go to menu) [Section: What's coming next?]

What's happening now? These patents are kind of in a legal limbo. The European Patent Convention says "programs for computers will not be patentable". This seems pretty clear that software should not be patentable, but they're still being handed out. The people who hold software patents rarely actually litigate against software developers because if they bring a patent to court, there's a good chance they're going to get their patent thrown out.

So Europeans are fairly safe at the moment. There have been a small number of cases, and in each case the verdict is a couple of pages long, so it's not always clear why a certain patent was rejected in court, but it seems that the courts are finding in our favour almost all the time, or possibly all the time.

[33:12]

What other problems are there? I mentioned that this isn't exclusively about software patents. It's about creating barriers to software development. Software patents were the gold medal for this, but there are other ways of creating these barriers.

(go to menu) [Section: IPRED2]

A new one on the horizon is IPRED2. This is the second directive on enforcement of "intellectual property rights".

These Directives are brought in with the justification of preventing organised crime, preventing health and safety risks to the public. The European Commission would like to prevent, say, counterfeit pharmaceuticals or counterfeit safety or manual labour materials. These are fairly good goals usually, but this Directive criminalises almost all copyright and patent infringements. It also criminalises trademark infringements, and plant variety infringements. The "Intellectual Property" term covers about 11 different rights that are often unrelated.

So, if you, supposedly, infringe a software patent, I'd say you have a 95% chance that the patent won't hold up in court. If patent infringement was a criminal offense, as this Directive proposes, instead of a civil offense, as it currently is - which means, if it carried a criminal record - then, would people take this 5% chance?)

If there's a 95% chance you're going to be found innocent, but the 5% chance carried a criminal record, the possibility of jail time, large fines, and the closure of your business. Will individuals take that chance? Some will, some won't. Will businesses take that chance? a lot of them won't.

This new Directive is not changing what is patentable, there are certain areas that are patentable, and there are a lot of grey areas. This Directive is making those grey areas so dangerous that people will treat them as patentable. So software patents, although they're not valid, they will be treated as valid.

[35:48]

(go to menu) [Section: Get active!]

Free Software Foundation Europe and Irish Free Software Organisation are both membership organisation. If people want to support the work we're doing, they can join the membership program and encourage others to do likewise.

If you want actually to take part in the work we are doing, the best way is to contact Irish Free Software Organisation. We have monthly meetings, and we have a mailing list where we discuss things.

We also provide a contact point for information on things such as copyright and patent developments. We work on patents, which a lot of organisations find difficult topics, and sometimes we find that we are the loudest, or we are people doing most work on our side of the debate, but it's hard to talk to the politicians, and it's hard to be recognised for the work we are doing. So if people would like our input, we can be contacted to discuss these things.

The contact point for Irish Free Software Organisation is contact at i f s o dot i e.

I said I was going to talk on these topics:

I discussed who says we are better off. The free software community says we're a lot better off without software patents, but a lot more than that, it's the US government has said "please don't repeat the mistake we made", it's jobs in Europe, and it's consumer rights groups.

I discussed how the European Parliament voted. The Directive is gone now, but it is going to come back. The Commission published a Directive because there was a perceived problem. There was ambiguity, there was harmonisation, these needed to be clarified, and we agree, this does need to be clarified. The European Patent Office is still handing out these patents, so we'd like to put a stop to that.

I mentioned what each side lobbied for, and the future for software patents in the EU. We can see there are some Directives on the horizon, but we also have to be ready for Directives we haven't expected.

The bigger picture that software patents are part of. I've covered what I wanted to say on that. At the end, we're going to have a panel-style Questions and Answers, and if you've any questions I'll be happy to answer them.

Thank you very much.

Q&A with Gareth Bowker, Ger Gibbons, and Ciaran O'Riordan

Ciarán O'Riordan:

I guess we'll take questions on the software patents Directive, on related issues or things to come, and things security-specific, and also, Ger will be able to provide comments on what it was like inside to the politicians.

(go to menu)
Audience Member 1:

Ger and Ciarán in particular, how well do you think you have communicated the case against, to MEPs? - do you think that MEPs, at least the current cadre of MEPs are sufficiently well educated on the issue, to take appropriate action should the issue return?

Ciarán O'Riordan:

I'll take that first. Half. The MEPs, a lot of them, still don't understand the patent system, some still don't understand software development, software businesses, software business models. And this is a very difficult thing, a lot of them are interested in fisheries or agriculture or journalism ...a lot of them, their interest is not in software, or their background isn't legal, and they don't all find it easy or interesting to learn about patents.

What we did do, was we managed to, we gained credibility in their eyes. We found them to be receptive, they did listen to us, and they voted as we asked them to vote. So we haven't completely explained the situation to them, but we have built a good base for understanding for when it comes up next time and we've also built our own reputation. We've established ourselves within the parliament.

Maybe that can be confirmed or denied by Ger?

Ger Gibbons:

When Gareth was speaking, he mentioned that if you look at a patent, it uses language that most people wouldn't understand. I think in the whole debate with software patents, the language that was used, that was coming to the MEPs was language that they didn't understand. To get that across - it was a very complex issue, to most MEPs. I'd say only a handful of them really understood the issue, I recall that when Proinsias spoke in the debate in September 2003 at the first reading in the parliament, he said in plenary that this was an issue that the MEPs were voting on with their fingers crossed behind their backs hoping that they're getting it right. That was the way that most MEPs were going to come to the issue.

Arising from the two contributions, there's just a couple of points I want to, if I could, make at this stage. There was a lot of emphasis in the two contributions on how this issue was dealt with in the European Parliament. I also think you have to realise that the European Parliament was not the only institution that was involved in this issue. The way that the decision making works, is that initiatives are proposed by the European Commission, and they are submitted then to the Parliament and the Council of Ministers both institutions have then a joint and equal say how the final format of the legislation, and the Commission issued it's proposal in 2001 and the Parliament carried out it's first reading in September 2003. The matter then was concentrated in the Council of Ministers. The Competitiveness Council adopted it's first reading, and it's called - eurojargon - a "common position" in March 2005.

The whole debate about software patents - you have to look at, not only the technical aspects of this, but I think you also have to look at how decisions are taken at a European level. If the Commission, for example, proposed this Directive ten years ago, the European Parliament would not have been able to veto it because the Parliament didn't have "co-decision" powers, in 1993. Anyone can check how their MEPs voted on this issue. You can't check how the Council of Ministers voted. The Council of Ministers took it's vote behind closed doors. The European Constitution, for example, would have obliged the Council to vote in public. Which I think adds to the public debate, public scrutiny, and it legitimised decisions like this.

The second point I just want to make is that the European Patent Office is not an EU body. It's entirely separate from the European institutions. And it's an inter-governmental treaty that the European Union has no control over. I think they're the sort of things you should be looking at - in addition to what you're doing at the moment.

I also just want to say it's a very very valuable step to have someone like Ciarán in Brussels. MEPs need to be able to ring somebody up, ring up Ciarán, on a Friday afternoon, at four o'clock, and say "I need a brief on such-and-such an issue, in half an hour" and know that they will be able to get it. Other organisations do that. The Irish Farmers Organisation has had a full-time office in Brussels since 1967. That's 6 years before Ireland joined the EEC. There's other lobby groups that are beginning to get into that. The development organisations are quite good on that. The trade union movement is quite bad. They still don't have a full-time office in Brussels. You need somebody like Ciarán, you need organisations that he works with in Brussels, and you need to support them.

Just on those points, I'd leave it at that.

Ciarán O'Riordan:

I'd like to quickly comment. I focussed in my talk on the European Parliament, but it is the other bodies, the Council and the Commission are all quite important as well. I didn't want to go into the legislative process. It can get messy. We found that it was easy enough to talk to the Parliament members. A lot of them did their best to understand this. We didn't talk as much to the other parties of the legislative process, so that's something we'll be working more on. But, we did find that it wasn't too difficult to get access to the MEPs. So that was something that I was glad to learn about European politics.

(go to menu)
Hannah Grene:

My name's Hannah Grene, and I'm from ICT Ireland which represents the hi-tech sector in Ireland. And we've a number of affiliate organisations, the one that would be affected by this the most is the Irish Software Association which is composed of mostly indigenous, mostly small companies. So I just wanted to quickly, a couple of words on SMEs, I know you touched on it there.

As you said, there were SMEs on both sides and our organisation and our member companies actually supported this particular Directive, so I just wanted to say a few words about why.

The Directive, as such, and you've gone into this, doesn't actually support the patenting of pure software. So what it supports is the patenting of technical, computer-implemented inventions. It was said, it was mentioned that this is a fudge to not say "software patents" but it is actually the name of the Directive. So I think it's fair enough to call it that.

What our SMEs were concerned with is that they would be able to protect any technical innovations that they made. So for them, the way they were coming to it, was when you talked about certainty here, they would come to it with some certainty that they could protect something that they had put forward - that they could make a profit from it, because that is what companies would like to do, and that they could then go forward with that into the future. So that's just one of the reasons why the SMEs that we were concerned with did actually support this.

Ciarán O'Riordan:

Can I answer that first part already. You made a connection there between being able to protect what they've made, and being able to commercialise it. And I don't think this is correct. They can apply for a patent - they can apply for their ...you can call it a software patent of a computer-implemented invention patent - they can apply for this patent, but when they go into the market place, they'll find that they have one patent, and they have to develop software without infringing 100,000 patents that are owned by other companies. These patents, some of them are trivial, some of them are broad, all of them are unreadable to a small company. It is literally impossible to find out if their software package infringes no patent. So they can have their one patent, and they can tell everyone else "you can't imitate us", but a lot of the time the market leaders aren't trying to imitate this one patent. So their ability to commercialise their product will be severely hurt. For example, I can explain why I think it's true, but also the US Federal Trade Commission, it agreed in it's report that it's hurting the commercialisation of software.

Hannah Grene:

If I can make the point just then on the US report. If I understood it correctly, the US report was actually on the US patent system, which doesn't actually resemble what the current situation is, or what..

Ciarán O'Riordan:

Well, we don't have software patents, yes

Hannah Grene:

...or what the Directive was trying to do, because what the Directive was trying to do was to harmonise the current situation across the member states and just to provide that certainty that we are talking about.

[10:10]

Ciarán O'Riordan:

The Directive was justified by harmonisation, but the actual effect was the validation of software patents. I don't know if it was the aim of the Directive, but it was the justification to harmonise. Nobody said "we need disharmony". Everyone was in favour of harmony in the European Union, but, the debate was, should software become patentable, or should it remain unpatentable, and should it be confirmed as unpatentable. This was the debate.

The US system, there are differences in their patent office - the standards they apply. But the core of the Directive was: do we allow software functionality to be patented. This was what the protests, this was what the meetings with the MEPs were about, this was the controversial part. In this way, a software patent in the EU is the same as a software patent in the US. The Business Software Alliance said "A CII (a computer-implemented invention) is what is called a 'software patent' in the US", they agree it's the same thing. In that way, that part is identical to the US. The way that software patents affect the software industry isn't dependent on anything in the patent system. It's a policy decision. The US Federal Trade Commission, what they say about software patents in the US, it's going to apply the same to the EU.

Hannah Grene:

I wouldn't be convinced of it being the same, because the patenting of pure software was actually excluded in the Common Position.

Ciarán O'Riordan:

The problem is "pure software". What is "pure software"? Is it still pure software when it's on a computer? or is it a computer-implemented invention? This is the whole fudge thing. There is no such thing as "pure software". Is there "impure software"? It's an invented term. It confused people, but it didn't actually have any meaning.

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Terry Landers:

Terry Landers, Microsoft. The criteria is that it involves a significant innovative step. So, that's a fairly objective and rational criteria and it's applied across the board for every invention - or every patent applicant. I wanted to raise a question about patenting. From what I heard this morning, you represent patenting as an intrinsic evil.

Ciarán O'Riordan:

No no no, I said at the start, among other things, patents inhibit development and in some sectors this is beneficial, for example in the automotive sector it can be beneficial, and the pharmaceutical sector, in the developed countries at least, it can be beneficial, but in software the costs are a lot greater and the benefits are not evenly distributed. So, for software, patents are not useful. They might be useful for other sectors.

Terry Landers:

I think, your view is very much contrary to the view represented by Wim Kok - Wim Kok is based in [inaudible, sounds like "China"] 2004 looking at the knowledge economy in Europe, and basically he was articulating the challenges of Europe adopting Lisbon Agenda of becoming the most competitive knowledge economy in the world. And he took the view, that if Europe is to become the most competitive knowledge economy in the world, we must be able to protect our intellectual property. Otherwise, not only will the Chinese make everything we need in the future, they will also take every idea we have, so unless we have, - it's absolutely an intrinsic building block, and so, I'd just be interested in your view: in a scenario where there is no patent protection, what is Europe's, or Ireland's future in the knowledge economy?

Ciarán O'Riordan:

First off, the Lisbon Strategy, one thing we noticed in Europe, nearly every document starts with "If Europe is to ever to achieve the Lisbon Strategy..." Both sides of the argument start with "...for the sake of the Lisbon Strategy..." After the Constitution was rejected, everything started with "To achieve European unity..." so these are things that are used on both sides.

"Patent protection". You talked about patent protection for software again - I can protect my one idea, which nobody is interested in, but the problem is, I have to avoid everyone else's - everyone else's patents are a restriction to me.

In the car industry, in the pharmaceutical industry, you can develop a part, you can develop a single product and sell it in a unit basis. But in software, everything has to be integrated. If I develop a super spell-checker, it's useless on it's own. Nobody goes into a shop a buys a spell-checker. It has to be part of a kit for making websites, it has to be part of a word processor, it has to be part of presentation software. So everything has to be integrated and there are hundreds or thousands of ideas in every software package. So I can own one of those ideas, and I can hold my patent, but if I point that patent at anyone, they'll say "hang on, we own seven of those ideas - and all these people over here, own a hundred of those ideas".

So what ends up happening is, my one patent, I cross-license with the other patent holders, and saying "ok, don't sue me. I'll promise not to sue you as well, but just don't sue me." So what happens is the other patent holders get access to my patent, and my patent hasn't "protected" me from anyone because the big competitors, the ones who can afford a large number of patents, they can compete against me because I've given them access to my patent.

The other thing I'd like to bring up is the China argument. This was fairly famous - the "Yellow Plague" it was called: what happens when engineers in China start "invading" our markets? I think one of the very good pro-software-patent lobbyists, he made this point, he said "China is bringing", I can't remember, but it was a large number, "100,000 trained engineers into the market each year, we need to prevent them competing in our markets".

What if those million, or 100,000, or whatever the number, what if those Chinese graduates all had European software patents? It's ok for us to have the European software industry, but you have to remember that it's not just Europeans that can apply for European software patents. In fact, Europeans are actually in the minority - owning European software patents, 75% are from other countries. So this is, the US telling us "The US owns these ideas, in Europe". The China argument, I'm not sure how valid it is, if we do have to worry about China, we have to worry about them patenting stuff in Europe, because America can own 75% of our patents, but if China grows to be the size of America, Europe's patent share is going to be 10%, so this is something that is going to seriously hurt Europe, if we allow the ownership of ideas. That's my comments on what you've asked about.

Terry Landers:

I've one other question, related to the FTC report. I think it was a rather selective interpretation of it, I think if you read it closely, I think you'll find, like Wim Kok did, in the European context, the absolute critical importance of a strong IP fabric. You insisted that there was no ... [inaudible, sounds like "value in IP"]

Ciarán O'Riordan:

I don't know if you've read the report. Page 165 is the conclusion of the software patents section. I'm not sure how difficult it is to find on the internet, it can't be very difficult. Anyone can contact Irish Free Software Organisation or myself and I'll send a copy of the document to anyone by email. Page 165, it lists the conclusions regarding ...actually, my slides are a copy of the conclusions, I simply put a bullet point at the start of each. So, "a selective interpretation"? It's actually word for word.

[18:40]

Ger Gibbons:

On that point, I just want to make a point that, the European Parliament was not opposed to the Directive. What the majority in the European Parliament was opposed to was the version of the Directive proposed by the Council of Ministers at its first reading. The Commission proposed the initiative in 2001, the parliament approved it with amendments in 2003. That's the key point, the Parliament accepted the need for the Directive, but the majority of the Parliament wanted to make changes to the Directive proposed by the Commission. And that majority is very much made up of a broad centre-left majority. The Socialist Group, to which Labour is attached, the Greens, the former Communists. MEPs also from the centre-right groups, the Christian Democrats and the Union for Europe, and the Liberal group.

In approach to the Parliament's second reading then, in the summer-time, there was a recognition. The centre-left was dissatisfied with the version agreed by the Council of Ministers. The centre-right, that's the Christian Democrats, the Union for Europe, the Liberals, they recognised that not all the amendments that they wanted to incorporate, would get a majority within the Parliament. They also recognised that the amendments that would come from the centre left, would contradict - the centre-left would contradict their own position, and the centre-left realised this as well. Both sides of the Parliament came to the conclusion that it's better to have no Directive than this Directive.

The Parliament wants to achieve a compromise. They want to try to get a balance, that is as acceptable as possible to all sides, but they felt that where things were going this summer wasn't it. So they decided to veto it. They don't do that that often. There's only been a handful of occasions over the past 10 or 15 years that the Parliament has vetoed legislation. They vetoed one about ten years ago, on biotechnological inventions, the Commission came back about two years later with a revised proposal which was later accepted by the Parliament. They acknowledged that it was a very very difficult issue, but it's something that there has to be European legislation. I think everyone will agree on that. Most of the people that lobbied, say, Proinsias De Rossa would have made that point, that there has to be some kind of legislation. Striking the balance is the key objective.

Ciarán O'Riordan:

A small addition I'll make. A lot of MEPs did look for balance, they looked for compromise, and that's in a way why this issue was so difficult. On a budgetary issue, on a financial issue, you can compromise by splitting it down the middle, but this is a policy issue: do you patent software functionality or do you not. You can't split it down the middle, and this is why it dragged on for so long.

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Harry Tormey:

I was just wondering if you could actually talk about the people who actually grant patents, in the EU and the US, what their qualifications are and how they assess if a patent is actually original.

Ciarán O'Riordan:

I can't talk about that. The reason is that I think it was incorrect some of the time to focus on the patent office. We noticed there were an number of silly patents, or a number of patents that were quite funny to read, that made good headlines - but this Directive wasn't about how strict the patent office was. It was about the rules they follow. It wasn't about granting patents that aren't new, or aren't innovative, but it was about: do you grant patents on software. We had to focus on the legislation. Sometimes it was easier to criticise the patent office, but that wasn't the domain we were working in. So I won't go into that.

Gareth Bowker:

One think I will quickly add, in the UK, over the summer, they were holding a consultation, with people from the UK, from the patent office, talking to business people, and so on, about the potential for this, the computer-implemented inventions Directive. I was talking to one of the patent officers there, and he was saying that for each patent that comes onto his desk, he's got about two hours to work out whether it is valid or not. That's the amount of time that they have to work out whether it's valid or not.

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Audience Member 2:

Do the patent office then have an official explanation on why they're granting software patents when it's not currently allowed in the legislation.

Ciarán O'Riordan:

Yes, some people will have heard of this: "patentable as such". The European Patent Convention says "programs for computers, will not be patentable, as such". The interpretation of this by the European Patent Office is "programs for computers will not be patentable as programs for computers" - but once you don't call it a "program for a computer", it is patentable. If you call it "A system for programming a computer, in order to do this.." Once you phrase it, or describe it in some other terms, that's patentable. That's where the ambiguity came from.

This is why we do hope there is a new Directive, we want to get this clarified, we want the "as such" defined, or possibly just simply removed, we need to get some kind of clarity in this.

[24:30]

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Helen Curly:

I'm Helen Curly from the Department of Enterprise, Trade & Employment, and just to clarify, you mentioned that the words "as such" are in the European Patent Convention, which dates back to 1973. Obviously the drafters of that convention, and the parties, the contracting states, agreed to the words "as such" being placed in it.

The idea behind that, was that, as you rightly said, computer programs per se, would not be patentable, but the affect of the words "as such" allows the European Patent Office to grant, what the Directive would call, computer-implemented inventions, and in fact, I think over 30,000 of them, I think was mentioned, in terms of the memorandum, the explanatory memorandum that accompanied the Directive from the Commission.

So, these things exist, and the purpose, as we understand it, behind the Directive was to harmonise the rules by which they might be valid across member states. In other words, it was an internal market measure to stop differences between protection in one member state and another. So for example, you might have a patent that was valid in one member state, and the court would take a contrary view somewhere else. So, the Commission's reasoning in putting forward the proposal was to stop this barrier to the functioning of the internal market in that area. Thanks.

Ciarán O'Riordan:

This is the thing. Yes, harmonisation was the justification for the Directive, but that was never the controversial aspect. Nobody is anti-harmonisation. The controversial aspect is, this "as such" clause exists in the European Patent Convention, but, how to interpret it, is not clear. At first, it was not interpreted as allowing software patents. Gradually over time, it has been more recently interpreted as allowing software patents. The European Patent Convention is from 1973, as you said, but it was only since the late 90s - 96, 98 - that software patents started being granted, so the history of the European Patent Office, is mostly not granting software patents, it's only a recent development, and also in the national courts, software patents have not been enforced. In some cases they have, in some cases they haven't, but there is not clarity there.

So we do need to clarify, but what we are arguing is: what do we clarify? do we clarify that they are patentable? or do we clarify that they are not patentable? Our argument was that this is bad for free software, it's bad for the economy, it's been proven bad by the US, employers don't want it, clearly we should harmonise on not allowing software patents. So it was about harmony, but it was about what do you harmonise on. I tried to explain why we ask for it to be harmonised not to allow software patents, and if something I said earlier doesn't seem justified, I'll take questions on that.

[27:50]

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Éibhear Ó hAnluain:

Éibhear Ó hAnluain is my name, I'm with Irish Free Software Organisation. Just a point first, regarding the UK patent office workshops over the Summer. One of the acts in those workshops was to present a set of different definitions of what a technical effect of an invention would be, because it's my understanding that this wasn't very clearly defined by the Directive as it was passed by the Common Position of the Council of Ministers. It appeared, and I'm open to correction on it, it appears that the definition that was put forward by the FFII, one which was very strict about what a technical effect would be, and which would have required some mechanical usage, was the one that was favoured most by those who were involved in those workshops.

That's my point, but you'll also just answer my question, it's that for IPRED2, and the criminal sanctions against the infringement of a copyrighter. There have been some high profile cases over the years where a small company has managed to successfully prosecuted an infringement case against a larger company with very high, large judgements against those companies. In a regime where infringement would have involved jail time, who from those large companies would have gone to to jail - would it have been the Directors? The CEOs? The software developers?

[29:33]

Gareth Bowker:

Just to talk about the FFII definition. I think it was the one that was most favoured, but there were still many points made about problems with it. It was talking about natural forces, but again, what level do you draw that upon. Some people were saying that natural forces, that would be down at the atomic level. An electron goes from one place to another, is still a natural force. It's a very difficult one to define, it's not defined well enough that you could categorically look at a piece of software and say this doesn't count.

Ciarán O'Riordan:

About jailing company owners. The Directive requires that jail time be available as a sentence, but every sentence will be handed down by a judge, and I don't think company owners are actually going to be put in jail by judges. I think the problems with IPRED2, the second intellectual property rights enforcement Directive is not so much jailing the company owners, but things like closure of business, things like large fines, being prohibited from competing in certain sectors - these are the issues, and the fact that areas of uncertainty are turned into no-go areas, areas where you're afraid to commercialise things. These are the real affects of IPRED2.

Éibhear Ó hAnluain:

But, on that, if I can just expand slightly. I am myself a company director. I work for myself, I'm the only person employed in the company. If I infringe on a patent, while for a large company which has access to expensive lawyers. It would be threat.

Ciarán O'Riordan:

It could be. I think closure of business is more likely, and I think we should also be worried about, well, jail time ...is an option.

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Micheal English:

My name is Micheal English, of the Department of Enterprise, Trade & Employment. First of all, can I say that I think it is very good initiative that this discussion is taking place, because, as I think you mentioned yourself Ciarán, these are very complex, and I think very important matters, for Ireland and for Europe, and indeed for the world indeed.

Just a few comments, simply on your own presentation, and then maybe one or two reactions to other points that have been made. My understanding is, the proposal originally in 2001, I think it always carried the title of "computer-implemented inventions", but for short hand I think, at least I interpreted it as short hand, people came to decsribe it as "software patents". I contend there is a difference between the two, and I know we've just visited one area of questions.

Second, is that, this is on a point that you made, Ciarán, as I understand it, the European Patent Office's patents, they may be invalid in the broad political sense, in the sense that you have a problem with the things that they are doing, I understand what you are saying in that sense, but in their own terms, they would argue, and it would appear they are, in that sense, quite valid.

Ciarán O'Riordan:

Can I comment on that bit there. What's happening is that they're valid according to the European Patent Office, of course, that's why they're granting them, but of course, the European Patent Office, as was mentioned, it doesn't have anyone over it, there's no one reviewing it, there's no on in charge of the European Patent Office, there's nobody over-seeing it.

The next step up from the patent office is the national courts. When the European Patent Office gives out a patent, the patent is not valid, there's nothing concrete about it the patent, until it's take to to a court, and tested in court, sometimes they're being held up, and sometimes they weren't.

They were valid according to the patent office, of course, but if someone accuses me of infringing a software patent, and I know that I do infringe what is written in this patent. How do I know that this patent is valid? The only way I can figure out is to go to court, and that's something I can't afford, a lot of people can't afford, people with large legal teams can afford, but for smaller bodies, the cost of a court case is prohibitive.

Micheal English:

On IPRED2, it's not my focus, or my brief here today, to defend the Commission or anything, but my understanding is that Commission's rational in putting forward this criminal infringements proposal is to do with commitments entered into, or are arising out of the TRIPS agreement, for all the countries that signed up to do all manner of things to protect IP worldwide, and that on the one hand, on the other hand what they argue in the preamble, I think some one of you quoted, that they were actually setting out to address serious problems, counterfeiting and so on.

Ciarán O'Riordan:

Can I comment on TRIPS there. TRIPS is a bit like the Lisbon Agenda, everyone's document mentions "To comply with our TRIPS obligations..." What TRIPS actually says, as far as I can remember the wording is "intellectual property rights shall be protected". It doesn't say "...will carry the weight of jail sentences." It doesn't say "...will give you a criminal record". It says they'll be protected, but this is being used as a justification, but ...one problem is, very few MEPs have the time or the inclination to look at TRIPS, and to dig out these documents, and go through them, and find out what they meant at implementation level.

For the software patents Directive, one of the reasons for it was "To comply with our obligations in TRIPS". TRIPS says "patents have to be granted for technical inventions". Some MEPs thought, that that means we need software patents, but actually it just means we need to define "technical".

[36:50]

TRIPS is there in the justification, but TRIPS doesn't actually require criminal sanctions for copyright infringement. The Commission's justification, I don't think the Commission is dishonest, that's not what I'm saying, it's just that whatever the aims of the Directive are, that's one thing, but it's the actual affects that I'm talking about.

I've talked to a few MEPs already, and they seem to be fairly willing to amend this - clarify a few terms, and that's great. It means it won't be as big a battle as the software patents Directive, but it just means we need to be there and represent the consumers, the free software groups, people like this, and we need to talk to the MEPs.

Micheal English:

I actually suspect the big area of disagreement between the two sides, if you like, to these issues, is actually the different side's assessment of the affects.

One final point, the European Patent Convention, and the European Patent Organisation, it's not a European Union institution. That might sound like an arcane point to make, but I think that's part of the reason why we have ourselves a situation where you've the European Patent Convention and the European Patent Organisation which is bigger than the European Union, and separate from it, and under which the European Council or Parliament has no particular competence.

Mind you, all the members of the European Union, as I understand it, are also members of the Patent Convention, but there are also a whole lot of other countries in there that are not members of the EU. And that might sound like a kinda of an arcane point, as i say, but I think it may explain some of the reasons why this problem is actually there in the first place. There are both technological reasons why it happens, I think particularly in the patents area, but I think there are institutional - geometry kind of reasons - why this has developed to the point where we are now where we are, wherever we all think that is.

Ciarán O'Riordan:

Yes, I agree with that.

[38:40]

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Mel McIntyre:

Could you comment on what politicians have an interest or energy for this subject, and who were the main lobby groups. What's the landscape of this argument?

Ciarán O'Riordan:

It depends, there are so many MEPs that it's hard to clump them. You can't say that any one group of MEPs is interested and another group is not interested. When the national parties go to the European Parliament, one will take an interest in copyright infringement, the other will look at agriculture, the other will look at fisheries. It goes like this. It wasn't always clear who would be interested in this. Sometimes we talked to MEPs and they were very disinterested, but when we explained the situation to them, then they started to understand, and they realise the importance of it. Some MEPs, if they were more interested in, agriculture, they wouldn't be too interested in software patents, when they hear both sides, they realise something strange is going on here, somebody's not being straight.

The MEPs weren't always predictable, so we had to talk to all the MEPs, even the ones that seem disinterested, and we found support in different areas. The Directive got rejected by 95% of the parliament, the Parliament was fairly united in the end that the current Directive wasn't going somewhere productive. Also, there were European elections between the first reading and second reading, and some people that were very active on it didn't get re-elected, and some parties that were very active got more people elected, and it changed over time.

Ger Gibbons:

When an issue was proposed by the Commission, and transmitted to the European Parliament, it's allocated to one of the sectoral committees within the European Parliament. There's about 20 of these: Internal Market, Employment, Environment, ...across the board. The committee, which would consist of about 20 to 30 MEPs from all member states, from different political groups. There's a quota system, the Christian Democrats have about 30% of the seats in the European Parliament, they have 30% of the seats in all the different committees. The Socialists have about 25%, and they would have 25% in all the different committees. There are slight variations in the committees, if a group wants to concentrate on a particular committee, it can go beyond their quota in one committee and reduce it in another.

[41:20]

The Irish MEPs, for example, would be split up in most of the committees. There might be one or two Irish MEPs in every committee, there might be one or two committees that don't have an Irish MEP. The Committee is sort of the driver of the issue within the Parliament. It could spend up to, in this case it spent up to two years before it produced its report. The report then is tabled on the agenda of the plenary session, and that's where the other MEPs come in in a sort of concentrated way. They would look at the report that has come from the committee. They have the right at any stage to table amendments to it.

Because of the range of issues that are on the European agenda, the MEPs by and large would allow their colleagues in their political groups to concentrate in the committees, and when the issue then comes to the plenary session, that's when they take an interest. And it's in many ways, there will be about 300 issues going through at any one time, it's impossible for MEPs to get on top each and every one of them, they take it on trust, for example, Proinsias would take it on trust that the other socialist MEPs are reflecting the interests that he would bring forward, if he were on that committee, and vice versa they would do the same for him. But I think on an issue like this, I think most of the Irish MEPs took an interest in it towards the closing stages, but there would be other issues which the MEPs would decide on - they wouldn't have gone into great detail on it, but on this issue, to be fair to them, I think most of them took an interest in it.

Malcolm Tyrrell:

I think we can take two more questions.

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Colm Buckley:

This is less of a question, but a series of remarks. My name is Colm Buckley, I'm from Google Europe. There was a point that Ciarán made several times, that I would like to reinforce, and I would particularly like to address this to ICT Ireland.

Software is extremely well protected, using copyright, and trade secret, and licence agreements. For example, somebody produces a song, a single is by and large produced by copyright. If somebody else rips off this wholesale and starts selling it, copyright protection is what is enforced.

Software is also fully protected by copyright. Somebody may not take substantial parts of somebody else's program and use it without the copyright holders permission. Software is additionally protected by the fact that it is usually distributed in a format that is not easily reverse-engineerable. One of the major arguments over this debate is that patents are necessary to protect software authors - which is fundamentally not true. Software authors are extremely well protected by comparison with most of the other creative industries - already.

[44:17]

The other main myth concerning patentability, is basically the myth of the small inventor. The idea that somebody working in their back bedroom comes up with a world-beating idea, and goes out and makes millions. This is gone. This does not happen any more, in a patent-rich environment, largely because of the reason that Ciarán said. It's very difficult to create an invention that stands alone. If you come up with a radical new design for a water cooler, and say "I'm going to make millions on this wonderful new-designed water cooler", chances are, you are going to be impeding somebody else's patent. The applicability of this to software, is that software already has a lower barrier to entry than most other industries. In order to make water coolers, I need to set up a manufacturing plant. In order to make software, all I need is a PC and an Internet connection. This is one of the main engines driving innovation in the software industry over the past 10, 15 years, in particular. Software innovations are largely driven by SMEs, and even individuals, not by large corporations.

The effect of patents, in any industry, but particularly in the software industry, is to dramatically tilt the balance of influence away from individuals and small enterprise toward large enterprises. Patents accrete and accrue - if you have patents, you will get more patents. Thereby, basically, consolidating and ensuring your own position the larger you are, the less likely it is for anybody else to be able to enter a field protected by patents.

[45:42]

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Audience Member 3:

This is not really a question, more of a comment. Given the strong grassroots support that we got, when the Directive was being debated, not only in Ireland, but especially in Ireland I suppose, and also given the fact that the SME organisations, both the Irish and the European SME organisations made their position clear that they didn't support software patenting. Were you surprised that Irish Software Association, which supposedly represents the Irish software industry, was lobbying for the Directive?

Ciarán O'Riordan:

I'm not too sure. In the time we had, we had to do whatever was most effective. I noticed they weren't supporting us, but we didn't have time to look into who are their membership? who do they actually represent? Should we contact the members and discuss escalating it? We didn't really have time to look at every organisation. We looked at who was already giving us support, we helped them, we tried to coordinate with them. But, people who weren't giving us support, we didn't always have time to look into that.

I was surprised, given their name, but based on only their name. I'm not sure what the organisation is like. On future things, hopefully we'll have time, in the intermission, to work with them or talk to them. But it didn't knock us off our chairs.

Malcolm Tyrrell:

Can I just get us to thank our speakers one more time. So thank you for attending and our contact email address is on the little card in the pack. Thank you.