Assessment of a pro-software patent submission
Evaluating submissions on software patents*
The  Ministry of Economic Development recently made submissions on the  software patents restrictions publicly available. The submissions to  however provide a useful glimpse at the arguments used. This article  examines one of those submissions.
Assessment of a pro-software patent submission
The  Airways Corporation (Airways) is a state-owned enterprise which  operates New Zealand’s air traffic control systems. It spends many  millions of dollars and long time periods developing software. Its  submission contains a few statements which I feel are worth examining.  Their submission sheds light on a few aspects of the purported benefits  of software patents.
Airways’ views on software patents generally
Paragraph 17 contains Airways’ two purported benefits to software patents. The first is that
[Software patents allow] New Zealand businesses to see a return … without fear of overseas or
local competitors in effect stealing their research and selling a competing product [emphasis added]
Patent  law does not restrict itself to cases of theft. A software patent would  prevent every third party from independently developing and  commercialising that software. Other intellectual property rights are  much more suited to the case of theft. Trade secrets and copyright are  much better placed to deal with this case. 
The second purported benefit is that
[software patents allow] the New Zealand developer to get an early assessment of the patentability
prior to incurring significant overseas patent applications (sic) costs.
A  cheaper alternative would be to seek advice from a registered patent  attorney. They are perfectly capable to providing an early assessment of  patentability. Moreover, New Zealand patent law is not directly  comparable with overseas jurisdictions.
In  order to realise these two purported benefits, require software patents  are not required. In the first instance, other intellectual property  rights are satisfactory. In the second, creating monopolies in New  Zealand so that it is easier to determine patentability overseas is backward.
Airways’ views on the impact of patents on their business
A summary of Airways’ position is provided on paragraph 15:
Inadequate patent protection in New Zealand is a significant risk for our business because it 
allows overseas competitors to locate their business operations here.
Airways  has its origins as a state-run monopoly. This statement implies that  despite its market dominance, that patents are the reason why others  have not entered the market. The reality is that there are other factors involved, such as the large amounts of capital required to develop an air traffic control  system in a tiny market.
Airways  is telling the government that they should insist on monopolistic  practices rather than innovative ones for keeping our airspace safe and  efficiently run. If another provider can offer the service in a more  efficient and equally safe manner to Airways Corporation, then we as a  country should not be preventing that.
Reading deeper
Airways’  submission implies that their first use of software patent prosecution  was in 2007. This means that Airways was operating profitably for many  decades without software patents. In paragraph 12, it compares this with  its competitors, one of which has over 1,500 software patents. An  assertion is made that Airways needs to catch up in order to be  competitive. However, disallowing software patentability in New Zealand  would eliminate any impact that those software patents would have in the  New Zealand market place. That is, it would level the playing field and  free Airways from the threat of litigation in this juridiction.
Removing  software patents thus saves hundreds of thousands of dollars. As well  as prosecution costs, it saves enforcement costs. Enforcing intellectual  property is extremely expensive. That money could be spent of  developing software to gain a competitive edge. 
Where does this lead us?
I  strongly believe in an empirical basis on the law. However, I disagree  with Microsoft New Zealand, about where the burden of proof lies. Microsoft  asserts that opponents of software patents must prove harm. I disagree. I  feel that supporters of the monopolies provided by software patents must demonstrate the value of  that system on the whole economy. Most areas of human endeavour and business involve inventiveness and innovation. Applying patents to our endeavours is the exception, not the rule.
Any  analysis should also recognise that there are many business models  which produce software, but which do not involve selling of software.  For example, hundreds of thousands of software developers worldwide use  the JQuery JavaScript library, but do not sell it. A software patent  that impacts JQuery would impact all of those downstream companies.
New  Zealand software developers should compete on the basis of the value  they bring to their customers. They should not compete on their ability  or willingness to legislate. By preventing software patents, the Select  Committee has insulated local companies from the threat of litigation.  The new status quo levels the playing field. It allows companies to  prosper that deliver the best service.
References
Airways submission http://www.med.govt.nz/upload/77047/11.pdf
Microsoft NZ position http://computerworld.co.nz/news.nsf/news/patent-ip-will-pass-from-aptimize-to-riverbed (See comments from Waldo Kuipers, Microsoft New Zealand’s spokesperson in intellectual property)
* Note, this analysis was submitted to me by an NZOSS member.
