Software Firms Overwhelmingly Against Patents

from the not-worth-it dept

There's been plenty of talk about whether or not software patents should be legal, and one of the "debates" we often run into in the comments is over whether or not the "software industry" really believes in patents or not. Some patent system supporters claim that most of the industry does, in fact, support patents, but it's a noisy bunch who is against them. Unfortunately for those who believe that, some new research is suggesting quite a different picture. It seems that a rather large majority of software firms don't seek patents and don't believe they're helpful or provide any real incentives:

Three-quarters of the D&B firms had no patents and were not seeking them. Because the D&B firms are, we believe, typical of the population of software startup firms in the U.S., their responses may be representative of patenting rates among software startups generally. It is, in fact, possible that the overall percentage of software startup patenting is lower than this, insofar as patent holders may have been more likely than other software entrepreneurs to take time to fill out a Berkeley Patent Survey.

For the most part, these firms just didn't think getting a patent was worth it. For all the talk of how patents protect companies and act as an incentive for investment in big projects, most software execs seem to disagree:

One of the most striking findings of our study is that software firms ranked patents dead last among seven strategies for attaining competitive advantage identified by the survey

Instead, they believe that a first mover advantage is a lot more important followed by "complementary assets," which is basically offering scarce services to complement the software.

The execs were also asked how much incentive patents provided for developing software, and the answer was about as close to none as you could expect. On a scale from 0 to 5, software execs said that patents were a 0.96 as an incentive for inventing something new and a 0.93 in commercializing a product and bringing it to market (innovating). And, before you say that this was skewed by people without patents, the report notes:

the results did not change significantly even when focusing only on responses from software entrepreneurs whose firms hold at least one patent or application. Even patent-holding software entrepreneurs reported that patents provide just above a weak incentive for engaging in these innovation-related activities.

The other interesting finding? If a firm is venture-backed, it's more likely to get patents, but this doesn't appear to suggest that the patents are valuable. It seems to indicate that entrepreneurs still believe the old claim that venture capitalists want to see patents, so they feel the need to get patents just to show to investors.

On the whole, it certainly appears that the vast majority of the software industry isn't interested in patents, don't find them useful or important, and certainly don't see them as creating an incentive. Even those who get patents don't see much value in them, and appear to only get them because they feel pressured to get the patents for external reasons. All in all, this is a pretty damning bit of research for those who suggest patents help the software industry.

Filed Under: incentives, innovation, patents, software patents