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In practice, software ended up being covered by both schemes, partly due to actions by the U.S. Congress, including several references to software in the Copyright Act, and partly as a result of decisions by the Copyright Office, the Patent and Trademark Office (PTO), and by judges. One could copyright one’s code and also gain a patent over the “non-obvious” novel and useful innovations inside the software. (In much of the rest of the world, software also came to be covered by copyright, though the status of patents over software was sometimes more obscure.) What can we learn from the history of the years since? A lot, it turns out, some not limited to the U.S., where intellectual property law often tends (for better or for worse) to disproportionately influence technology policy worldwide.
There are lots of reasons to doubt that this vision of “creation out of nothing” works very well, even in the arts, the traditional domain of copyright law. But whatever its merits or defects in the arts, it seems completely wrong-headed when it comes to software. Software solutions to practical problems do converge, and programmers definitely draw upon prior lines of code. Worse still, software tends to exhibit “network effects.” Unlike my choice of novel, my choice of word-processing program is strongly influenced, perhaps dominated, by the question of what program other people choose to buy. That means that even if a programmer could find a completely different way to write a word-processing program, this programmer has to be able to make it read the dominant program’s files and mimic its features if the programmer is to attract any customers at all. This hardly sounds like completely divergent creation. Seeing the way software failed to fit this Procrustean bed of copyright, many scholars presumed the process of forcing it into place would be catastrophic. They believed that, lacking patent’s high standards, copyright’s monopolies would proliferate. Copyright’s treatment of follow-on, or “derivative,” works would impede innovation, it was thought. The force of network effects would allow the copyright holder of whatever software became “the standard” to extract huge monopoly rents and prevent competing innovation for many years longer than the patent term. Users of programs would be locked in, unable to shift their documents, data, or skills to a competing program. Doom and gloom abounded among copyright scholars, including many who shared the premise that software should be covered by property rights. They simply believed that these were the wrong property rights to use.
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