Volume 14, Number 2 Article by Subhashish Gupta September, 2002
IPR: Information Technology :
How does one protect intellectual property in an intangible digital economy? Can mere ideas or algorithms be patented? Why is it that software can be patented in some circumstances and not in others? Are we barking up the wrong tree in pursuing patents while most IT technologies are related to standards? Discussing these issues and more are Shamnad Basheer, IT Attorney; T R Madanmohan, Associate Professor, IIMB and S D Sherlekar, Principal Consultant (Embedded Systems) at TCS Bangalore.
Computer software, pointed out Shamnad Basheer, can be legally protected by patenting the software, copyrighting the source code and protecting the software through ‘trade secrets’, wherein the source code is kept confidential. In the US and EU, software can be patented, provided the software is not claimed ‘per se’, but is coupled with a ‘technical effect’. He spoke of the difficulties of enforcement of rights, especially on the Internet, licensing and contractual arrangements and jurisdictional issues on the Internet and online business model patents.
S D Sherlekar explained the selective patentability of software in terms of sensors and actuators, and Shannon’s theorem; and how product companies play the game of standardisation. Plumping for standards in the standards vs patents debate, T R Madanmohan defended his stand vis a vis IT. As an approved document recommending voluntary rules and guidelines covering the characteristics of products, processes and methods, standards play an important role especially in industries where ‘technological routines’ are not yet formed and a dominant design is yet to emerge, as in Internet technologies. They allow firms to achieve economies of scale, ensure supplier specialisation, increase efficiency over the entire product life cycle and reduce uncertainty along the technical dimension, thus eliminating the role of marketing characteristics. To ensure that new standards come in, companies have to be given incentives to innovate continuously. So unlike patents which are artificial barriers for innovation, today’s markets are interested in continuous incremental innovation. However, Madanmohan concluded, standard setting is a political game and as an industry we have never understood this, less so the government.
Reprint No 02306 b
