Microsoft, along with a large number of other tech companies, has been calling for patent reform for some time. Today, they give an object lesson in exactly how necessary this is.
Brad Smith, general counsel at Microsoft, stated in an interview with Fortune that free and open source software like Linux and Open Office infringe hundreds of Microsoft-held patents. The Fortune article states that Microsoft wants royalties for these allegedly infringing patents.
This is the same Microsoft that is calling for patent reform, noting a patent system swollen with patent that should have been rejected, and brimming with litigation.
Tech companies are prominent voices in the charge for patent reform because IT and software aren't always the best fit for patent protection. Any one product can contain thousands of components, each of which might have a patent on it. And software development moves so fast that many developers will independently create solutions for problems that might infringe any of the thousands of existing software patents–it simply isn't practical, economical, or sane to require everyone who writes some code to do a patent search to see if they're infringing.
But in calling for patent reform, companies like Microsoft shy away from saying that a lot of these existing patents probably shouldn't have been granted in the first place. They will note, for example, that patent quality needs to be improved (read: bad patents are being issued for already-created, obvious, or just plain unpatentable things); or that they defend against so many infringement suits at any given time (without comment on the validity of the patents they try to enforce when they're suing others).
The reason for such caution is that Microsoft and others wield their patent portfolios as weapons. Often, they claim that these are used solely for defensive purposes. For instance, if Google makes noise about suing Microsoft for an infringement of patent X, Microsoft can start making noise about Google infringing patent Y. Litigation is averted when the two formally strike a cross-licensing deal, or informally agree not to sue each other. This has been called the “mutually assured destruction” theory of patent litigation.
Small companies, it's argued, are rarely targets of lawsuits by the major companies, because they will likely not have the deep pockets to make a lawsuit worth the effort, while small companies can go after the software giants on a contingency basis.
But the threat of Microsoft suing companies for using Linux now tells a different story. Open source distributors who lack the same defensive portfolios held by other patent-happy developers are left vulnerable in such a system. And their financial success makes them viable targets on which to spend a legal war chest. And now Microsoft can use its patent portfolio offensively.
From the article:
Microsoft counters that it is a matter of principle. “We live in a world where we honor, and support the honoring of, intellectual property,” says Ballmer in an interview. FOSS patrons are going to have to “play by the same rules as the rest of the business,” he insists. “What's fair is fair.”
The thing is, the rules of patent in the software industry aren't limited to the letter of the law. Unless you have the legal and financial wherewithal to build your own arsenal of patents, the industry's superpowers can play an insider's game, by an entirely different set of rules.