Free Software, Free Society: selected essays of Richard M. Stallman. 2nd edition.

This cross-licensing practice is very important to understand, because this is what punctures the argument of the software patent advocates who say that software patents are needed to protect the starving genius. They give you a scenario which is a series of unlikelihoods.

So let’s look at it. According to this scenario, there’s a brilliant designer of whatever, who’s been working for years by himself in his attic coming up with a better way to do whatever it is. And now that it’s ready, he wants to start a business and mass-produce this thing; and because his idea is so good his company will inevitably succeed— except for one thing: the big companies will compete with him and take all his market the away. And because of this, his business will almost certainly fail, and then he will starve.

Well, let’s look at all the unlikely assumptions here.

First of all, that he comes up with this idea working by himself. That’s not very likely. In a high-tech field, most progress is made by people working in a field, doing things and talking with people in the field. But I wouldn’t say it’s impossible, not that one thing by itself.

But anyway the next supposition is that he’s going to start a business and that it’s going to succeed. Well, just because he’s a brilliant engineer doesn’t mean that he’s any good at running a business. Most new businesses fail; more than 95 percent of them, I think, fail within a few years. So that’s probably what’s going to happen to him, no matter what.

Ok, let’s assume that in addition to being a brilliant engineer who came up with something great by himself, he’s also talented at running businesses. If he has a knack for running businesses, then maybe his business won’t fail. After all, not all new businesses fail, there are a certain few that succeed. Well, if he understands business, then instead of trying to go head to head with large companies, he might try to do things that small companies are better at and have a better chance of succeeding. He might succeed. But let’s suppose it fails anyway. If he’s so brilliant and has a knack for running businesses, I’m sure he won’t starve, because somebody will want to give him a job.

So a series of unlikelihoods—it’s not a very plausible scenario. But let’s look at it anyway.

Because where they go from there is to say the patent system will “protect” our starving genius, because he can get a patent on this technique. And then when IBM wants to compete with him, he says, “IBM, you can’t compete with me, because I’ve got this patent,” and IBM says, “Oh, no, not again!”

Well, here’s what really happens.

IBM says, “Oh, how nice, you have a patent. Well, we have this patent, and this patent, and this patent, and this patent, and this patent, all of which cover other ideas implemented in your product, and if you think you can fight us on all those, we’ll pull out some more. So let’s sign a cross-license agreement, and that way nobody will get hurt.” Now since we’ve assumed that our genius understands business, he’s going to realize that he has no choice. He’s going to sign the cross-license agreement, as just about everybody does when IBM demands it. And then this means that IBM will get “access” to his patent, meaning IBM would be free to compete with him just as if there were no patents, which means that the supposed benefit that they claim he would get by having this patent is not real. He won’t get this benefit.

The patent might “protect” him from competition from you or me, but not from IBM—not from the very megacorporations which the scenario says are the threat to him. You know in advance that there’s got to be a flaw in this reasoning when people who are lobbyists for megacorporations recommend a policy supposedly because it’s going to protect their small competitors from them. If it really were going to do that, they wouldn’t be in favor of it. But this explains why [software patents] won’t do it.

Even IBM can’t always do this, because there are companies that we refer to as patent trolls or patent parasites, and their only business is using patents to squeeze money out of people who really make something.

Patent lawyers tell us that it’s really wonderful to have patents in your field, but they don’t have patents in their field. There are no patents on how to send or write a threatening letter, no patents on how to file a lawsuit, and no patents on how to persuade a judge or jury, so even IBM can’t make the patent trolls cross-license. But IBM figures, “Our competition will have to pay them too; this is just part of the cost of doing business, and we can live with it.” IBM and the other megacorporations figure that the general dominion over all activity that they get from their patents is good for them, and paying off the trolls they can live with. So that’s why they want software patents.