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Gwen Smith Ishmael, Sr. Vice President of Insights and Innovation at Decision Analyst in Arlington, TX, has led marketing and new product development activities in the CPG and technology industries since 1986. She also conceived and developed ground-breaking Web-based promotional vehicles, two of which are patent pending. Gwen holds an MBA in Marketing and is a featured speaker on insights and innovation around the world. Her writings have been featured in international text books, most recently in Managing 4 Ps of Marketing FMCG Sector, and Product Innovation: A Strategic Tool for Growth, by ICFAI Publications, 2006 and 2007, respectively.

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Renee Hopkins Callahan Renee Hopkins Callahan started IdeaFlow and serves as chief blog-wrangler. She is Director of Innovation Services at Decision Analyst in Arlington, Texas, is a former journalist who worked as an editor and reporter for The Dallas Morning News and the Nashville Tennessean, and was managing editor of D, the Dallas city magazine. She has a master's degree in rhetoric and has also taught college-level English and informal logic.
In the Pipeline: Don't miss Derek Lowe's excellent commentary on drug discovery and the pharma industry in general at In the Pipeline

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February 3, 2005

Patents: The EU Restarts and IBM Releases

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Posted by Renee Hopkins Callahan

My apologies for a long, quiet January. The best I can say about January is that it's over!

Now that I'm resurfacing, the largest innovation-related issue in the news is patents. Yesterday the European Parliament voted to ask the European Commission to withdraw draft legislation that could have set the stage for allowing patents on pure software. (Currently patents on pure software are not allowed in European patent law, which is very different from U.S. patent law.)

Opponents of software patents have been lobbying members to restart the legal procedure on legislation so that safeguards could be inserted into the legislation that would guard against the patenting of pure software.

Meanwhile there continues to be a lot of coverage of IBM's surprise announcement on Jan. 10 that it would release 500 of its patents to the open-source community. IBM officials called the move "the company's first step in an effort to spur new ideas in the software community through collaboration and shared knowledge, and called on other intellectual property holders to join their 'patent commons.' "

While the move was applauded by many in the open source community – the direct beneficiaries of the move -- some speculated that one of IBM’s motives might be to help convince European legislators that open source and software patenting are compatible.

Still, IBM’s move has been seen by many as good for innovation in general, and open innovation in particular. Analysis in the Financial Times put it this way: “The idea is that money and freedom have struck up a whole new relationship in cyberspace. The old logic of patents was this: inventors needed them to protect themselves from the idea snatchers….But in cyberspace that is not always true, argues Lawrence Lessig...When it comes to software, where each inventor must build on what went before, sharing may well be more productive than hoarding. Prof Lessig points out that software patents are themselves a relatively new invention: until the 1980s, they were unavailable. He argues that they stifle, rather than foster, innovation. Software patents, Prof Lessig says, can create an "anti-commons": a world where "overlapping property rights make it impossible for anyone to develop a resource for fear of being held up by one of the rights-holders.”

Other perceived winners from IBM's move:

Web services: ZDNet's SOA -- Service Oriented Architecture Blog quotes AMR Research’s J. Paul Kirby: "IBM s promise makes it harder for Microsoft and Sun to monetize Web services transactions....This aligns closely with the position of the primary Web standards body, the W3C consortium, which has a preference for royalty-free use of technology. If the W3C finds favor with IBM s plan, it will be much harder for Sun and Microsoft to pick the other side."

Ross Mayfield’s Blog reported, “This is a significant move and part of a broader strategy to commoditize their inputs, pool risk, leverage a lead in services and change the game.”

Search: SearchViews called the move "innovation breeding innovation" and cited PatentCafe's launch of their OSS Search Engine, populated with the IBM patents "part of the new vision of search as a living, breathing storage mechanism for all the world's information."

Most coverage I read agreed that IBM’s move was bad for Microsoft:

Said Business Week, "The move is central to IBM's efforts to fend off Microsoft and its Windows monopoly...it is stepping up efforts to bolster the world of open-source software. IBM figures that doing so will give it a leg up in selling the software and services that work with the open-source programs it helped develop."

Linux World quoted Groklaw: "The Windows patent strategy is so over. And the next time Bill Gates tries to call this new kind of software development a kind of modern-day communism, as he did so offensively the other day, people will simply laugh in his face." The article also includes the speculation that "[IBM's move] might be the start of a 'viral' subversion of the patent system, in just the way that the GPL arguably is for copyright."

My take: Both events – the proposed redo of European patent legislation and IBM’s patent grant – can be seen as wins for innovation in general, and open innovation in particular. It seems that an either/or solution is probably not feasible or desirable. Some hybrid of a collaborative development environment and patent protection will be necessary. Even if you’re not into the nitty-gritty legal details of patent and copyright, it will be illustrative to watch as the ramifications of both these events unfold. They are setting the stage for what patents – and innovation – will look like in the future.

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