Software Patents in Europe

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Open Letter to the Fraunhofer Gesellschaft (FhG)

July 6th, 2004

Dear Professor Bullinger,

"Research should be able to earn its money also on the market!" - say politicians so we, the Free Software Foundation Europe, understand when researchers use creative ways to get a better income. But even researchers should take care not to bite the hand that feeds them. This danger is real, especially with the actual software patent discussion:

The Fraunhofer-Gesellschaft is well known for its patent of the MP3 audio-compression standard. Another compression procedure, named Ogg Vorbis, is considered to be of higher technological value by experts. If software patents should indeed be introduced in Europe, the Ogg Vorbis developers could be confronted with license claims at will by the Fraunhofer IIS1, although they took care not to infringe the MP3 patent. The FhG might be able to get rid of an unpleasant competitor or would at least better its income substantially. We will avoid a discussion of the ethical questions related to such a behaviour.

However, it certainly is not very useful from the economical point of view if a good idea blocks an even better one: this is also shown by Dr. Daniel Probst of the chair of Economy and Economical Theory at the University of Mannheim. Dr. Probst stated in a hearing of the German parliament regarding software patents in June 20012:

"The part of SME (small and medium-sized enterprises) would sink and a concentrational process would begin. Based on network effects, a few large enterprises would gain a dominant place on the market. As far as allowed by competition regulations, they would agree on cross-licensing their patent portfolios and would hinder market entry of new companies with blocking patents. The research intensity in the branch would stagnate or fall." There would also be a significant decrease of Free Software solutions.

Personally I regret every single point of the above. There are many more deficiencies, some of them have been shown to the new German president, Professor Köhler, in an open letter in June3. A particular important point for you as head of the Fraunhofer Gesellschaft should certainly be the quote "The part of SME would sink...", especially regarding the fact that, according to the German government4, the FhG is taking 60 percent of its research orders from SMEs.

Another point to take into consideration would be that big companies might move the research to the eastern parts of the European Union, because they can find in Poland and other newly entered EU countries perfectly competent software developers at a fraction of actual costs.

For Europe's greatest research society in the field of "information and communication technology", this could mean not only the disappearance of their project partners but, even worse, the dying of the companies which FhG wanted to live of. "Sawdust is falling since quite a certain time, the splintering of the branch is imminent."

Kind regards

Georg Greve
Free Software Foundation Europe
fsfe.org

1 http://www.iis.fraunhofer.de/
2 http://swpat.ffii.org/events/2001/bundestag/probst/index.de.html
3 http://mail.fsfeurope.org/pipermail/press-release-de/2004q2/000030.html
4 http://www.bmbf.de/pub/inno-masterplan.pdf