Yesterday, the European Parliament killed the “software patents directive,” which was a directive initially intended to permit “computer implemented inventions,” but was burdened with some 28 amendments. All of the anti-software patents activists united against the directive and succeeded in killing it. The Financial Times has a good story here.
The funny thing is that they hailed it as “European Parliament says no to software patents, yes to innovation.” But did it really?
The European Union arose from the ashes of two world wars and the endless succession of dictators and fighting. The goal of the European Union has always been to bring stability and consistency to the region. In that effort, the EU has always tried to preserve competition by protecting the disadvantaged competitor against the abuses of the stronger competitor.
Contrast that to the United States, where anti-trust law is largely considered from the consumer’s standpoint. If the under-performing competitor cannot deliver the goods as well as the larger competitor, we feel no sorrow as the weaker competitor is trounced in the marketplace, provided that the consumer gets a better product for a lower price.
These two mechanisms tend to arrive at opposite decisions on various issues. When a dominant company rolls out new products that squash their competitors, the US reaction is that the innovation is good for consumers. In the EU, it is viewed as anti-competitive, and the dominant company may have to make concessions to its inferior competitors.
The US mentality gives a special status to innovators and companies that change the marketplace, whereas the EU philosophy gives special status to preserving the status quo by keeping competition “equal.”
Using this framework, it is easy to see why the EU might vote down a directive that would give innovators (patent owners both big and small) a big competitive advantage over weaker competitors. The innovators in the US tend to be a protected class, whereas in the EU the weaker competitors are the protected class. Yesterday’s vote is yet another embodiment of that philosophy.
