http://www.guardian.co.uk/comment/story/0,3604,1646125,00.html

Owning ideas The boom in the intellectual property market will not reap rewards for us all

Andrew Brown

Saturday November 19, 2005

The Guardian

The difference between ideas and things is obvious as soon as someone hits you over the head with an idea - so obvious that until recently it was entirely clear to the law. Things could have owners and ideas could not. Yet this simple distinction is being changed all around us. Ideas are increasingly treated as property - as things that have owners who may decide who gets to use them and on what terms.

Ideas such as one-click shopping, getting customer reviews on a website or even putting classified ads on the internet are now patented, which is to say that somebody owns them - Amazon.com the first two, Google, the classified ad patent - and anybody else who wants to make use of them must pay a rent to the owner. Last week, Amazon was also granted a patent that covers getting shoppers to review the things they have bought on its website. BT has tried to patent the hyperlink, Microsoft is trying to patent XML, a way of writing computer files that is fundamental to the operation of modern business.

The fight over the human genome and its patenting - and over the patenting of drugs - is another, and perhaps more familiar front in the war. Ideas are codified as intellectual property and regarded as among the most important assets a company can own. As where things are made becomes less important in the formerly industrialised nations of the west, the real value comes in the licence to allow others to make them.

Even facts about the world can, in some cases, become the property of commercial companies. It was the promise of gaining patents on the human genome that lured investors into the private consortium that attempted to sequence it in competition with the public effort. Laboratory animals have already been patented, starting with the OncoMouse, an animal whose genome has been manipulated to ensure that it develops cancer.

Science was one of the first fields in which the confusion of ideas with things became apparent and damaging. It has always been one in which ideas and techniques were freely shared. You might say that any scientific experiment is worthless until it has been copied - if it can't be repeated, it isn't scientific. Scientific papers, too, measure their influence by how often they are copied or quoted in others. But as the practice of science has grown more expensive, and more commercial, so has the pressure to patent everything. The public project that sequenced the human genome, led by Sir John Sulston and Bob Waterston, defined itself as in opposition to patenting data. This wasn't just an idealistic stance. They were convinced that without freely available data the work would flow less swiftly, if at all, and that the results would be very much less useful. In fact, the so-called private project run by Craig Ventner used a method that relied on the availability of publicly sequenced data as a springboard for the short cuts it took.

Sulston now, after his Nobel prize, spends much of his time campaigning for public access to scientific knowledge and its fruits. In a world where material goods are so unevenly distributed, the effort to lock up ideas and intellectual riches as well seems to him quite monstrous. The struggle over patents in science and technology is usually presented as one between rich countries and poor ones, with big pharmaceuticals on the one side and almost everybody in the world on the other. It is certainly true that the governments, the peoples and the industries of poor countries have fewer drugs than they might otherwise have because of international patent law. But so do the big companies themselves. It is not just the results of scientific inquiry, like drugs, that are controlled as intellectual property. It is, increasingly, the knowledge needed to make them or to understand how they are made. Where scientists once worked over a safety net composed of other scientists' experiments, they can now have the impression that they are working over a minefield composed of other companies' patents.

In this world, size is no protection. It just makes you a more succulent target for enemy lawyers. It is the biggest and most enterprising firms, whose work is likely to make use of the greatest bodies of knowledge, that are most at risk. Naturally, this has a chilling effect on the work that is done. Big pharmaceuticals must patent everything, if only to be certain the competition does not do it first. They may, of course, later exchange patents with their rivals. But that simply helps to confine invention to the very largest companies, as the smaller ones have little to trade with.

This is even more true in the software industry. The law of copyright - and of patents - long precedes computers, which fit very uneasily into the old frameworks. Neither copyright nor patent law is satisfactory here, but patents on software threaten to have the most disastrous effect on the future of programming, since only programmers can break it. In the beginning, computer software was neither patented nor copyright. For so long as the machines had no users, only programmers, this made sense. But in the mid-1970s, people started to see they could make money out of software. This is not easy or obvious, because when I make a copy of your program, you still have the original, which works just as well as it ever did. Equally, when you make a copy and sell it to me, it has cost you nothing, so why should you charge me for it as if it were a limited resource? There is no answer from justice to these questions. The only answer that makes sense is that certain arrangements of copyright promote a flourishing market in software, which is in society's general interest, so it should legislate for them. Without it there would be no commercial software industry, or any way to ensure that free software stays free.

Bill Gates first came to the attention of other hackers when he objected to their taking his earliest Basic programming language and copying it, as they were used to doing. He won, and Microsoft's riches rest on copyright law. But they also depend on its constant violation. Around every legitimate, full-priced piece of software hangs a penumbra of pirated versions. Most of these will be converted, at some time, into legitimate purchases. But the fact that you can use most MS software for free has been an important factor in spreading the habit of using it and in killing competition. The companies that make most fuss about "software piracy" know perfectly well that if it were entirely abolished, they would be less well off.

Software patents came along later, and are much more damaging, because they can be enforced. Copyright protects only particular program code. It does not - crucially - protect the way that it looks and works. Nor does it protect the clever ideas contained within it. In a world where software is only protected by copyright, competition works like evolution - by incremental improvement.

Patenting software could stop all that. Because patents are meant to protect inventions, they apply to ways of doing things in software. This can be discussed as if it were real machinery, but in fact it's an idea, or an arrangement of ideas.

The final problem with software patents is that they can be taken out on business processes, such as Amazon's one-click buying. Here, what is protected is not even a trick to writing programs. It is a way of dealing with customers. That is the kind of innovation the market is meant to spread more quickly than any other mechanism. Patents on business processes obviously deliberately slow this process down, and if clever business ideas can be patented, why not other ideas? There is a man in California trying to patent movie plots.

US venture capitalists now refuse to back a company until it has applied for a patent on its business practice, which they will keep if it fails, as most startups must. If this practice continues, the chilling effect for the future is obvious. The first company into almost any field will fail. But if it leaves enough patents behind it, these may strangle all its successors. Patenting ideas rewards failure and makes success more difficult. You can't argue that they are needed as incentives. Bill Gates made his fortune in a world without software patents - and if that's not big enough to act as an incentive, nothing is.

There is some evidence that patenting has not slowed down research into genomes, simply because researchers ignore them. But they are impossible to ignore in software, partly because the laws governing infringement are so drastic. The directors and board members of any company found guilty of patent infringement are liable to triple damages, personally as well as corporately. So companies that may infringe patents simply can't be sold until the patent holders are bought off, and this is almost always easier and cheaper than fighting the patent, no matter how worthless. This gives the holders of patents tremendous powers of extortion. The only defence is for everybody to do it, which still further clogs up the system.

For most people these concerns may seem abstract - at least until they listen to music, where arguments about ownership are fought over all the time in the courts and, increasingly, inside the gadgets that we use. Only last week, Sony was forced to withdraw software concealed on some of its CDs that installs itself - without the owner's knowledge or informed consent - on a computer, prevents copies being made and breaks the machine if an attempt is made to remove it. At least 47 recent CDs have been infected in this way, and one recent survey suggests that they in turn have infected half a million PCs during the last three months. Any PC thus infected can be attacked by more obviously malevolent hackers who can use the Sony technology to install their own programs on the victims' PCs. But whether it is Sony or some Russian mafia gang that ends up working through these security holes, it won't be you, the poor sap who thought he/she owned the computer and had bought the music.

Legally, of course, we don't buy music, any more than we buy software. We agree to buy certain, limited rights, which vary from country to country but which have all been routinely disregarded until very recently.

In the US, for instance, it is illegal to copy your own CDs on to your own iPod. Obviously, this is a law that is broken all the time, or nobody there would ever buy an iPod. The 60GB model sells for $350 (£200); to fill it up with freshly downloaded content from the Apple store could easily cost another $25,000.

Just as with computer software, the legal market has broken down because there is no obligation for buyer and seller to agree on a price, or even on what is being sold. Computers have made it possible for both sides to cheat on their agreements. Buyers can use some forms of file sharing and sellers can write ever more restrictive licence agreements to make it clear they are not selling anything, merely renting it out. There are some download services where the music you have already downloaded will no longer play if you stop your subscription. The obvious answer is to pay for it with money similarly protected - special digital rights money, which would vanish, like fairy gold, when you stopped playing with the new toy. Nobody would accept payment on those terms. Why are there companies which think the opposite is fair?

The answer is that they are operating in a climate where intellectual property seems to guarantee an endless, effortless stream of money to its owners. The big content owners have been determining the world's intellectual property regimes for the last few decades. By clever lobbying at extraordinarily boring conferences, they had managed by the late 90s to commit governments, through the world trade talks, to a draconian programme of laws extending the notion of intellectual property to the point where a Norwegian teenager can be threatened with jail when he writes a clever programme to let him watch DVDs on his own computer - because he is said to be providing tools to steal intellectual property.

This is madness. Ideas aren't things. They're much more valuable than that. Intellectual property - treating some ideas as if they were in some circumstances things that can be owned and traded - is itself no more than an idea that can be copied, modified and improved. It is this process of freely copying them and changing them that has given us the world of material abundance in which we live. If our ideas of intellectual property are wrong, we must change them, improve them and return them to their original purpose. When intellectual property rules diminish the supply of new ideas, they steal from all of us.