body, the U.S. Supreme Court. Indeed, prior to the 1981 U.S.
Supreme Court decision in Diamond v. Diehr, it was not possible to patent
software at all, and the current craze to patent every click of the mouse
originates in the subsequent extension of patents to software products in
the 1994 federal circuit court ruling In re Alappat.
Did this judicial legislation bring forth an explosion in software innovation? We mentioned Amazon suing Barnes and Noble over purchasing
online with just "one click." Some might wonder how difficult and innovative this invention is, so it may seem a straw man. Whatever the merits are
of one click, there are certainly many software inventions that we all agree
are important and innovative. There are all the graphical user interfaces; the
widgets such as buttons and icons; the compilers, assemblers, linked lists,
object-oriented programs, databases, search algorithms, font displays, word
processing, and computer languages - all the vast array of algorithms and
methods that go into even the simplest modern program. These innovations
not only are all difficult and important, but also the fact is that every single
one of these innovations is used and is necessary to make the one click, or
for that matter two clicks, work.
We do not mention any of these significant inventions as a consequence
of patents on software innovation for one simple reason. Each and every one
of these key innovations occurred prior to 1981 and so occurred without
the benefit of patent protection. Not only that, had all these bits and pieces
of computer programs been patented, as they certainly would have in the
current regime, far from being enhanced, progress in the software industry
would never have taken place. According to Bill Gates - hardly your radical
communist or utopist - "if people had understood how patents would
be granted when most of today's ideas were invented, and had taken out
patents, the industry would be at a complete standstill today." 2
Not only did patents play no role in software innovation, but also copyrights played only a limited role. Although computer programs were often
copyrighted, in the early years of the PC industry, copyright was seldom respected or enforced. Consumers would purchase programs and use them
on a variety of computers in violation of license agreements. People bought
and sold computer programs and created new ones by using bits and pieces,
modules and ideas, from existing programs. Although copyright may have
limited the widespread copying of software by other publishers, it was not
enforced in the draconian way that it is today.
The software industry is a leading illustration of one of the subthemes of
this book. Intellectual monopoly is not a cause of innovation, but rather an
unwelcome consequence of it. In a young, dynamic industry full of ideas and
creativity, intellectual monopoly does not play a useful role. It is when ideas
run out and new competitors come in with fresher ideas that those bereft
of them turn to government intervention - and intellectual "property" - to
protect their lucrative old ways of doing business.
Ifwe examine the efforts of Microsoft to prevent "piracy" of their software,
we find that it made little effort, either legal or technical, to protect its
"intellectual property" in their early creative days. It is now, in the twentyfirst century, that it invests its time and energy in the prevention of copying.
However, if we compare releases of Microsoft operating systems or word
processors over the past five or even ten years, it would be difficult to
detect much innovation. What is Microsoft's greatest innovation since 1994?
No doubt, the Web browser Internet Explorer. But who invented the Web
browser? Not Microsoft, but a small group of creative competitors from
whom, later on, Microsoft took the idea and then acquired most of the basic
code: the first popular version of a browser, NCSA Mosaic,
Kristina Jones, Celeste Jones, Juliana Buhring