UK companies see perils in software patents

The government's claim that patents protect innovation was questioned by industry experts at a meeting on Tuesday where the proposed EU software patent directive was discussed.

Lord Sainsbury, the minister for science and innovation, and the UK Patent Office (UKPO) heard evidence that many companies have been successfully protecting their work through copyright laws, and are unhappy about the prospect of having to apply for patents on software they develop.

The UKPO has for a long time claimed that the Computer Implemented Inventions Directive is necessary in many industries, such as the machine tool sector.

In 2001, secretary of state for trade and industry Patricia Hewitt said: "Our key principle is that patents should be for technological innovations. So a program for a new machine tool should be patentable but a non-technological innovation, such as grammar-checking software for a word-processor, should not be."

Since 2001 the Patent Office has frequently said that an invention can only be patented if it makes a "technical contribution", such as the software which controls a physical object, rather than software which automates business methods. It also claims that the directive merely clarifies the status quo.

But yesterday at the patent meeting, Julian Todd, a machine tool programmer, said that few UK machine tool companies have taken out patents to date, but he is concerned that this may now be a costly necessity due to the directive.

"Although your current law says all this is patentable, patents are not used in this sector -- if you check out the companies in Britain you won't find patents," said Todd. "We're pretty sure that patents will start to be introduced in this sector."

"The way we work is we develop an idea and others copy it and we have to keep working to keep ahead of competition. If we were able to patent we would be able to protect lack of innovation and development, because we would have no competitors. All the money we spend on R&D, we could [need to] sink into lawyers," Todd added.

One of the few UK machine tool companies that has started using patents is Delcam, although according to a press release from 2002 this was done reluctantly.

"Traditionally, Delcam has relied on copyright to protect our innovative intellectual property but we have started to apply for patents in response to the unwelcome trend, particularly in the USA, to seek patents for any innovative processes," said Delcam in the release. "This is clearly an increased expense but one we now feel we must selectively embrace to ensure that we enjoy the benefits of our developments."

Lord Sainsbury responded that American companies have patents and that patent law contains the trade-off that to protect innovation it is necessary to temporarily stop other companies from innovating.

In response to a further question from Todd on whether the UKPO had spoken to UK companies about this issue, Peter Hayward, a director at the UKPO, admitted that it hadn't.

"We spoke to American companies," said Hayward.

Todd told ZDNet UK on Wednesday that he is following up his question with a letter to Lord Sainsbury. He is concerned that the European change in patent law will allow US software companies, which already have many patents, to out-compete UK companies.

"There is a thriving Computer Aided Manufacture software industry in the UK that is competitive and world class," said Todd. "The endgame of the software patent battle is that the entire European software industry will be sold and exported to companies in America and Silicon Valley who hold most of the patents and can use their lawyers effectively. Like the UK film industry, there would still a lot of good work and people here, but it would be entirely dominated and controlled from California."

Todd is not the only member of the audience who believes he has not had a satisfactory answer from the patent office. Various developers at the meeting said afterwards that the patent office had avoided their questions. Although, at least one concession has come out of the meeting with Lord Sainsbury agreeing to hold a workshop to discuss technical contributions.

But these concessions may have come too late as the EU Council may pass the new patent directive in a Fishery or Environment meeting before Christmas.