• Sharad Sharma

    Patent shift: Hope for IT innovation, not litigation

    One of the persistent threats to India’s software product ecosystem is from the constant push by MNCs for allowing software patents in India.

    India’s nascent software product industry is growing rapidly and is on a trajectory where we can see global brands like Amazon, Google and Facebook emerge in the next 10 years.

    One of the persistent threats to India’s software product ecosystem is from the constant push by MNCs for allowing software patents in India.

    The MNCs (or more often, their well paid lawyers) cleverly couch this argument by saying that this will promote “innovation” and help the domestic software industry .

    To which, we at the Indian Software Product Industry Round Table (iSPIRT), would like to respond by saying, “Thanks for your concern, but let us Indians worry about innovation within our own country”.

    Over the last several years, we have seen many attempts by MNCs to (mis)interpret the Indian Patents Act in such a manner that software patents will be allowed in India.

    We firmly believe that software patents are a recipe for litigation and not innovation. The history of patent litigation in the US serves as a cautionary tale for India. If you are a software developer in the United States, writing code and innovating is a risky proposition. The moment you are successful, patent trolls land up, claim that you are violating their patents and try to extract royalties from you.

    Research conducted by James Bessen and Michael J Meurer, explained in their widely acclaimed book “Patent Failure How Judges, Bureaucrats, and Lawyers Put Innovators at Risk”, has shown that patents in the area of software have high rate of litigation. Due to the nature of software, the boundaries of patents granted in this field are often hazy and this leads to increased litigation.

    The authors in a study published in 2012 estimate that direct costs of patent assertions by patent trolls total about $29 billion accrued in 2011. In 2011, a number of mobile app developers, most of them based in the US, got legal notices from a firm called Lodsys.

    The notice claimed that in-app purchases used by these apps violated the patent held by the firm and threatened them with legal action if they did not enter into a license agreement with Lodsys.

    Thankfully , Indian software developers and startups have not had to encounter such frivolous legal notices until now. Individual developers and star \tups can innovate freely in India, thanks to the foresight of our parliamentarians who exempted computer programmes per se from patentable subject matter. More patents has never meant more innovation.

    This is a myth that patent lawyers love spreading, as patent litigation serves to expand their market opportunities.

    However, the “Guidelines for Examination of Computer Related Inventions (CRIs)” (2015 guidelines) issued by the Patent Office on August 21, 2015 could have changed the scene in India as it was worded in a manner that permitted patents in the field of software.

    Although the guidelines are only meant to ensure a uniform approach by the staff of the Indian Patent Office while examining patent applications and does not constitute rule-making, these would have led to a liberal examination process resulting in grant of more patents in the area of software.

    This would have made innovation in the area of software akin to step ping on a mine field. We therefore welcome the order issued by the Controller General of Patents, Designs and Trademarks dated February 19, 2016 finalising the Guidelines for Examination of Computer Related Inventions (CRIs).

    It is also important to call out the role of lawyers in this discussion. Warren Buffet, the ace investor, famously said, “Never ask your barber if you need a haircut.” In a similar vein, policy makers must disregard the self-serving clamour call from lawyers for more software patents in India. Most of these lawyers stand to benefit from increased patent filing and increased litigation.

    Allowing software patents would have paved the way for digital colonisation of India, since the vast majority of software patents are owned by MNCs.

    We therefore applaud the Indian Patent Office for revising the guidelines and promulgating a clear test for issuing patents. We believe that these guidelines are some of the clearest guidelines anywhere in the world and we believe this will help innovation, not litigation.

    BPO Talent To Be Groomed For Inside Sales In SaaS India
    Digital India: What Is eSigning & How It Works

    Tags: , , ,

    Mar, 21
    2016
  • Copyright © 2013 - 2017 iSPIRT foundation | All rights reserved | Powered by iGenero and Netsolutions

    Read more:
    Difference in the group
    Building for the world? Then take it to the world.

    [This post is written for Indian startups. If you are not one, you will not find much value in it. But don't take my word for it. Read through the post to know for yourself.]......

    Close