IBM last week unlocked access to 500 of its software patents for the open source community, generating mixed reactions from industry watchers.

While IBM's move could help users get new open source products faster by removing development roadblocks, open source advocates and patent watchers ultimately would like to see companies such as IBM change their overall software patenting strategies. At the centre of the issue is current US patent practice, which grants what critics say are overly broad patents on trivial or abstract processes. The quagmire of patents that developers have to weed through to avoid infringement is unmanageable, and the result for corporate users is slower product innovation and delays in standards progress.

"I say, thanks very much. It's a good start, but it's certainly not the finish," says Bruce Perens, open source evangelist and a founder of the Open Source Initiative. The patents IBM has chosen to make available to the open source world are just a small fraction of its portfolio, he says.

With IBM's pledge, the technologies covered by 500 of its software patents are available royalty-free to companies or individual developers working on open source software, removing the threat of a patent lawsuit by IBM. The patents cover a broad range of technologies, including data encryption, caching, compression and language processing.

Opening access to these technologies is an effort to help foster innovation, says Douglas Heintzman, director of technical software strategy at IBM.

In addition to forfeiting potential revenue IBM might have earned by licensing its technologies to open source developers, IBM assumes the burden of maintaining the 500 patents in question - which costs more than $1 million each year, Heintzman says.

Of course, it's not all sacrifice for IBM.

IBM doesn't deny that. "We believe that this will promote and drive innovation in our marketplace. Certainly our company will benefit as the rate of innovation accelerates," Heintzman says.

Given that a significant portion of IBM's business is related to open source, primarily Linux, the decision to grant patent amnesty obviously is motivated in part by self-interest, says Stephen O'Grady, a senior analyst at RedMonk. "If Linux as an operating system can be enhanced or at least have some of the concerns around patent infringement removed, certainly IBM stands to benefit," he says.

While the contribution is significant, it's not entirely unexpected, adds Dan Ravicher, executive director of the Public Patent Foundation, a non-profit legal services organisation in New York working toward patent system reform. Most legal observers would have presumed before the announcement that IBM would not sue, at least in the near term, the makers of open source products off of which it is making money, Ravicher says.

To IBM's credit, by granting access to any open source developer, not just those with which it partners, the company is allowing broader access than what had been presumed, Ravicher says.

Linux creator Linus Torvalds says IBM's move is a good first step toward solving some of the problems with software patents. "Will this make patent problems go away? Obviously not. Would I have preferred that IBM open all their patents and speak out against software patents in general? Hey, sure," Torvalds wrote in an e-mail interview. "But no, that's not how things work. I'm pragmatic."

Not everyone sees any benevolence in IBM's move.

Florian Mueller, campaign manager of, a European anti-software patenting effort, spoke harshly about IBM's pledge, calling it "diversionary tactics."

The European Union (EU) has been considering adopting software patenting practices. IBM - which holds about 40,000 worldwide patents - is among the companies lobbying strongly for it to happen, according to Mueller.

"If IBM wants to assume the role of a post-Christmas benefactor, they'd better stop their aggressive patent lobbying in the EU and their shameless squeezing of small and medium-sized companies with that IBM ‘patent tax,'" said Mueller. "Let's take it from there. We can still talk about some kind of patent pittance after that."

The patent problem

IBM is certainly not the only vendor making money licensing patented technology. It's just among the largest targets for criticism, given that for the last 12 years IBM has earned more U.S. patents each year than any other company.

Statistics released last week by IFI Claims Patent Services show IBM earned 3,277 patents in 2004 - 1,312 more than the second-ranked company, Matsushita Electric Industrial Company. According to Heintzman, software patents make up approximately half of the patents IBM registered last year.

What critics of software patenting object to is the power afforded a patent holder, at the expense of future innovations.

Software patents typically are very vaguely written. "That's done deliberately so that the patent has the maximum scope of application - which is a terrible abuse of the system, because patent holders can claim things that they didn't invent," Perens says.

Like a lot of patents, software patents can cause competitive and economic harm by precluding or hindering competition, Ravicher says. Additionally, software patents can deny the right to due process simply because the cost of defending against a patent claim is prohibitively high, he said.

Statistics from the American Intellectual Property Law Association show the average cost per litigant in a $1 million-plus patent litigation case is $2 million to $4 million, Ravicher says.

At its worst, software patent abuse has the potential to shut down open source, Perens says. "Especially if you get Microsoft and its buddies working at it in a concerted way," he says. "They can make it too expensive for people to be open source developers. It potentially can have the same effect on any small business that raises the ire of large patent holders."

It's not just developers who are subject to patent lawsuits, but also end users who deploy open source software that could infringe on a patent. When The SCO Group launched a lawsuit against IBM in 2003 claiming IBM illegally contributed SCO's Unix intellectual property code to Linux. Part of its tactics included sending letters to more than 1,000 large corporations warning they could be liable for using Linux.

"Software patents can be asserted against individuals and small businesses who don't have the wherewithal to hire very expensive attorneys," Ravicher says. "Patents can be used to intimidate people into paying a license fee or just closing up shop because they can't avail themselves of a day in court to fight the battle."

Part of the reason patent litigation is so expensive is because there's so much uncertainty in the law. There's a single appellate court responsible for hearing patent cases which are appealed, and that appellate court overturns decisions made by trial courts 50 percent of the time, said Ravicher.

No one ever settles after trial because there's a 50-50 chance the decision will be reversed later on appeal. "This creates a very expensive game," Ravicher says.

IBM's Heintzman acknowledges the patent-granting process in the US could be refined. In particular, the threshold for getting a patent should be raised quite a bit higher than where it is, he says.

"We're very strong advocates of good and reasonable intellectual property law. On the other hand, we're concerned that intellectual property can be used and has been used in ways that it was not intended, in terms of putting a brake on innovation," he says.

For its part, IBM has been rethinking its approach to intellectual property, he says.

The company has a comprehensive process for evaluating patent applications to ensure each one represents genuine scientific progress and technological innovation, Heintzman says. "We easily could just submit and receive twice the number of patents that we are actually granted," he says. "But that's not what this is all about. We're not in business to win the patent race."

In the last six months, IBM set up a team charged with rethinking the company's patent strategy. That led to IBM's announcement in August that it will not assert any of its patents against the Linux kernel. The team also drove last week's decision regarding the 500 software patents.

Torvalds welcomes the fact that IBM's policy shows the business community a way to embrace the sharing ethos of open source developers. "The more people that think about this and the more businesses that get comfortable with the notion of sharing, whether it be their copyrighted software or their patents, the better off we'll all be," he wrote.

Meanwhile, patent reform is gaining momentum, but it's not an overnight process.

"It could take 10 years, but we really have to turn back the tide of software patenting in the United States. And at the same time, we have to hold it off in other nations," said Perens.

It's going to become more apparent over the next decade or two that the patent system is not a benefit to technologists, but an impediment, Ravicher says.

"As the coalition of voices calling for patent reform grows, and as the number of people benefiting from the patent system becomes more and more parasitic - patent attorneys instead of technologists - it will be more and more politically untenable for policy makers to refuse to fix the system so that it achieves its true purpose, which is advancing technology," he says.