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Doc Searls rocks, and EPO patents by country

Linux: Doc Searls will be speaking at LinuxWorld Expo 2004 in Dublin. Apparently, he’ll be discussing DIY-IT — the ‘real’ Linux story (‘how the demand side supplies itself’). That presentation is great — strongly recommended.

(If you’re in a hurry, just skip to the funny part.)

Patents: op-ed article in the Sydney Morning Herald about patents and US-Australia ‘free trade’ talks.

… The cost of fighting a patent litigation battle in the US has dropped considerably. “Claims are now actually decided by a judge and only about 3 per cent of cases go to trial,” he says. “Therefore, costs have been limited dramatically. In most cases, costs are less than $US2 million.” (jm: my emphasis)

The question remains as to how many small Australian technology companies can afford to put up that sort of money if they believe their patent has been infringed or, worse still, if they have been accused of infringing a patent. (jm: exactly! the playing field is tilted dramatically.)

Local software developer Jeremy Howard believes that the US-Australia free trade agreement legislation has the potential to stifle local development. Howard has created two software systems with global potential, a portable email product called Fastmail (jm: hooray Fastmail!) and an insurance-industry package called Profit Optimising System. He believes two particular provisions of the FTA could be devastating to local software development. One is the requirement for Australia to have legislation similar to the US Digital Millennium Copyright Act (DMCA) and the other is the stringent enforcement of software patents.

“The (DMCA) legislation removes the ability to use reverse engineering to make products compatible with existing products,” Howard says. “There are two negative effects of this. It reduces competition: effectively no one who writes software can be compatible with existing proprietary software. It’s also bad for security and privacy: people won’t be allowed to analyse protocols to see whether they’re secure because that’s considered reverse engineering. Thus, we see that this legislation will protect vendors from bad publicity as well as competition.”

Howard considers DMCA as a serious threat to the local software industry, but he believes a potentially even greater threat from the FTA will be a requirement for Australia to stringently enforce software patents.

“Many US software companies have huge portfolios of patents,” he says. “It costs millions to fight a (disputed) patent suit, so small companies will be forced to pay licence fees to patent holders or be shut down. This means that it will clearly not be practical for small software businesses to try to become established on the world stage. We’ll be spending more time worrying about patents instead of innovating.”

A very, very clueful article. Here’s hoping EU-based journalists are taking notes! The data about software patents being of much greater benefit to US companies than local exporters is a big deal, so I’ll write about that in the next posting.

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