No patents is a no brainer for New Zealand

No patents is a no brainer for New Zealand

Summary: Why spend all those years in the garage developing your wonderful software if some cheat is to come along and rip-off your creation?

TOPICS: Patents, New Zealand

For an industry that relies on innovation, the development of new products and processes, you might think the IT sector would be keen to protect its intellectual property.

But in an about turn yesterday, the New Zealand government decided that patents would be unenforceable for software. And the country's software industry applauded it.

It seems that patents are more trouble than they are worth. Registering patents and enforcing them is such a costly process, especially for the smaller firms that New Zealand tends to have.

In the United States, we see the costly effects of patent law. There is a huge battle going on between Samsung and Apple over who copied what on their smartphones, and no-one is benefiting bar the lawyers who are earning millions of dollars in fees.

Governments also say that this legal stoush is damaging to consumers, and I am sure both parties would be better off spending money on innovation and creation than in legal bills.

More significant is the effects of so-called patent trolls, organisations that buy up a patent, and then use that patent to extract a demand from a company doing something similar to what your patent covers.

Thus, we hear that patent law stifles development, and no wonder there are efforts in the US to tackle patent trolls and make it easier for firms to challenge patents in the software sector.

New Zealand software companies have said that existing patent laws act as a deterrent when they are conducting research.

Removing patent law will remove this legal uncertainty.

Overseas, one study has claimed that patents in the software industry have cost the US economy half a trillion dollars since 1990.

A US book called Patent Failure said that in the late 1990s, patents resulted in payments to software patent holders of $100 million a year, but the litigation costs were $3.88 billion.

Of course, there still needs to be some protection of intellectual property.

It appears that copyright law will be sufficient, as it is more clearly defines what is actually copied, compared to the more conceptual basis typically used by patents.

And that is the view of New Zealand's IT companies, who are doing quite nicely, recruiting staff and exporting more.

IT lawyer Guy Burgess highlighted a comment from Orion Health. It says that the best way to protect your intellectual property is to innovate, and innovate fast.

New Zealand has many innovative companies, such as Orion Health, Jade Corporation, and Xero, who are investing millions, innovating fast, and keeping ahead of the game, fully aware they effectively have no software protection.

But they can still apply for it in overseas markets should they ever feel the need for it.

Furthermore, New Zealand will also benefit from software companies migrating from Canada and elsewhere to our country for what I dare say is a patently freer and easier environment for them.

Looking at all these benefits, it certainly seems that having no patents was certainly a no brainer of a decision from the New Zealand government yesterday. It is surprising that it took them so long.

Topics: Patents, New Zealand

Darren Greenwood

About Darren Greenwood

Darren Greenwood has been in journalism, not all of it IT, since the days of typewriters and long before the web spun its way around the world.

Coming from Yorkshire, he can be blunt, and though having resided in New Zealand, as well as Australia, for quite some time, he insists he is not one of the 'sheeple!'

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  • The quickest way to innovate is reverse engineering and then steal the code

    The most cost effective way to innovate is to steal - no doubt about that. Then how does civilization innovate? Why, by mob rule and by the gun. Survival by the most vicious and the most brutal.

    Let those that code for a living protect their work thru guns!

    How's that scenario for you.

    The rule of law has NEVER been cost effective. And some persons may bemoan the judicial system their excessives.

    Too bad New Zealand is run by a bunch of thieves. But then again, just trace their ancestry. Not New Zealanders in general - just their leaders.
    • no

      if you are not able to finish and sell your innovations, any one else will do better = very good for our future and progress! ;)
    • A copy of something... not innovation. They still have copyright for the blatant copies, which pretty well makes your entire point invalid.
  • thoughts

    "Of course, there still needs to be some protection of intellectual property."

    I think that can be argued. Especially in respect to software patents. Some people think that software doesn't need IP protection at all, and I don't think they're completely crazy.

    "It appears that copyright law will be sufficient, as it is more clearly defines what is actually copied, compared to the more conceptual basis typically used by patents."

    I'd agree. In copyright, you're guilty if you actually copied the work. In patents - well, you could invent the same thing completely independently, no copying at all, and if it just *happens* to be similar to something else, you're considered guilty. Not entirely sure I agree with such a philosophy.

    That, plus patents enforce a monopoly on the product - and as we all know, monopolies aren't healthy. And for some odd reason, a patent monopoly takes a long time to expire. No really good reason for it to last so long: Most software is long past maturity and often even outdated by the time the patent expires.

    I think it's probably time we rethought the entire process, and what we really want to accomplish.
    • Copyright may not be the panacea that some think...

      ever check the terms of copyrights in USA? "The Copyright Term Extension Act (CTEA) of 1998 extended copyright terms in the United States. Since the Copyright Act of 1976, copyright would last for the life of the author plus 50 years, or 75 years for a work of corporate authorship. The Act extended these terms to life of the author plus 70 years and for works of corporate authorship to 120 years after creation or 95 years after publication, whichever endpoint is earlier.[1] Copyright protection for works published prior to January 1, 1978, was increased by 20 years to a total of 95 years from their publication date."
      (credit Wikipedia)
      95 years! That's a long time to wait...maybe licensing the use of patented intellectual property isn't such a bad idea afterall if you are trying to manufacture a product for sale.
      • Of course that's not to say copyright isn't broken either.

        Of course that's not to say that copyright isn't broken either. Yeah, there's a lot of work left to do.
  • Copyrights

    I don't know what the law is in New Zealand, but the (superior) alternative to patents is copyrights. Part of the problem with software patents is that they *don't* allow for reverse engineering. Reverse engineering has always been something that has been allowed for in non-software patents. If somebody figures out a way to attach two pieces of clothing together, say Mr. Singer, it shouldn't prevent others from inventing machines that attach clothing together; they just have to use a different mechanism. Software is just code. Nobody can see the mechanism. So a patents in software have disallowed reverse engineering. This is why software patents have gotten out of control. I think copyrights should be upheld, but I think software patents going by the wayside would be fantastic worldwide.
  • Patents!!

    I think patents should be allowed only on some best, creative and innovative ideas or thoughts. software patents