[FSFE PR][EN] Allianz Group will suffer because of software patents

FSFEurope Press agency press at fsfeurope.org
Mon Oct 4 11:28:43 CEST 2004

            Allianz Group will suffer because of software patents

   October 4th, 2004

   Dear Mr. Diekmann,

   Have you ever considered offering general insurance for stock brokers
   against the risk of losing money? As absurd as this sounds, the
   European Commission is seriously considering equivalent measures at
   the moment.

   The European Council and the European Commission seek to introduce
   software patents in Europe. This is not only threatening any company
   doing business in Europe, [1]a number of international scientists also
   see it as a grave risk to European economies. Adding to the studies
   already known, recent publications by [2]Pricewaterhouse Coopers (PwC)
   and [3]Deutsche Bank Research further underline the damaging effect of
   software patents. As [4]The Register quotes PwC: "The mild regime
   [...] in the past has led to a very innovative and competitive
   software industry with low entry barriers. A software patent, which
   serves to protect inventions of a non-technical nature, could kill the
   high innovation rate."

   The reality of software patents is well-known for its purely
   speculative character. Although generally endorsed by noble goals such
   as promoting innovation, studies from the [5]Massachusetts Institute
   of Technology (MIT) or the [6]German monopoly commission show that
   software patents are harmful to innovation.

   Software patent applications could be considered like the chips that
   are bet on a roulette table that -- if successful -- will win you the
   jackpot in form of a multi-billion Euro litigation. Any large
   corporation making use of software could find itself on the receiving
   end of such a bet. The more money at play and the more software used,
   the higher the chance of being targeted. Valuable companies such as
   Allianz group -- which are in the main dependent on software revenues
   are especially at risk of being adversely affected by the legalisation
   of software patents in the EU.

   While I believe the plans of the European Commission should already
   have you quite worried, the current plans are going to affect you in
   another aspect, as well.

   Having to acknowledge the harmful and potentially devastating effect
   of software patents on European companies and national economies, the
   European Commission recently introduced the idea of another directive
   aimed at creating a [7]compulsory insurance against software patents
   for all European enterprises. This insurance should obviously be cheap
   enough so that it does not immediately kill the European economy

   You, as CEO of Allianz Group will have to insure your enterprise,
   because you are at risk of being the target of a multi-billion Euro
   software patent litigation. This is essentially the same as asking for
   cheap compulsory insurance of all stock brokers against losing money
   -- and we are certain that you see the flaw in that logic.

   We would appreciate the opportunity to discuss this problem with you
   further, but now time is of the essence. The European Council is
   planning to decide in November and the European Parliament will then
   have to make a final decision early next year.

   With kind regards,

   Georg Greve
   Free Software Foundation Europe (FSFE)


   1. http://mail.fsfeurope.org/pipermail/press-release-de/2004q2/000030.html
   2. http://www.pwc.com/Extweb/pwcpublications.nsf/docid/EC6DE73A846581CE80256EFD002E41FB
   3. http://www.dbresearch.com/PROD/DBR_INTERNET_EN-PROD/PROD0000000000175949.pdf
   4. http://www.theregister.co.uk/2004/09/15/pwc_swpat_are_a_threat/
   5. http://www.researchoninnovation.org/patent.pdf
   6. http://swpat.ffii.org/archiv/zitate/index.de.html#mopoko0207
   7. http://europa.eu.int/comm/internal_market/en/indprop/patent/docs/patent-litigation-insurance_en.pdf

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