Gates on Patents

amcpherson's picture

From the New York Times:

WHAT a difference 16 years makes. Last month, the technology world was abuzz over an interview in Fortune magazine in which Bradford Smith, Microsoft’s general counsel, accused users and developers of various free software products of patent infringement and demanded royalties. Indeed, in recent years, Mr. Smith has argued that patents are essential to technological breakthroughs in software.

Microsoft sang a very different tune in 1991. In a memo to his senior executives, Bill Gates wrote, “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.” Mr. Gates worried that “some large company will patent some obvious thing” and use the patent to “take as much of our profits as they want.”

Mr. Gates wrote his 1991 memo shortly after the courts began allowing patents on software in the 1980s. At the time Microsoft was a growing company challenging entrenched incumbents like I.B.M. and Novell. It had only eight patents to its name. Recognizing the threat to his company, Mr. Gates initiated an aggressive patenting program. Today Microsoft holds more than 6,000 patents.

It’s not surprising that Microsoft — now an entrenched incumbent — has had a change of heart. But Mr. Gates was right in 1991: patents are bad for the software industry.