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Industry Insight

Why register or patent?

The ramifications of not protecting software and technology developments can be costly.

There is no denying that life in the digital era means new digital solutions are surfacing every day through the development of software.

There are several software inventions out there unprotected by patents.

In terms of the South African patent law, computer programs are not patentable, but protection thereof is provided for under the Copyright Act. Since there is a dearth of case law in SA in respect of the patentability of software, it has been suggested that South African courts may find in favour of patenting software if the software produces a technical effect, as is the case in Europe.

Since the South African patent law is mirrored on the European and UK patent law, this may well be viewed by local courts as the right approach. It must, however, be noted that SA is a non-examining country, and as such, filed applications for patents proceed to grant if all the formalities have been complied with, and will not be subjected to examination in respect of the substantive requirements, such as novelty and inventive step.

It is a well-known fact that patents have been used globally over many generations in various societies as one of the tools for protecting inventions and for promoting innovation. The primary incentive for the patent system is to grant inventors the monopoly power over novel and non-obvious products or ideas, by preventing others from making, using, selling or importing those products.

The fundamental assertion of those who oppose the system is the belief that the unreasonable pricing of patented products, as a result of the monopoly over such products, is an impediment to their access as it places such products out of the financial reach of certain groups of people.

Patent pending

There are several software inventions out there unprotected by patents. Authors or developers thereof are not reaping the benefits offered by the patenting system, which affords creators of novel inventions the ability to potentially create and exploit new markets through the right to monopoly conferred directly by the patent legislation.

There may be consequences for not protecting software or technology developments. An example of this is seen in the issue involving the "Please Call Me" mobile messaging app for which MTN registered a patent. MTN was the first mobile communications company to launch the app, and Vodacom followed suit a few months thereafter. MTN, as the patent holder, could have enforced its rights against Vodacom, but it did not, and as such the latter dodged a bullet.

Interestingly, a Vodacom employee instituted legal action against Vodacom, alleging he came up with the "Please Call Me" idea prior to the launch of the messaging app by Vodacom, and as such he should receive a share in the revenue generated by the public use of the app. After a long battle, the court eventually ruled in favour of the employee. Clearly, this whole app matter could have had dire consequences for Vodacom, since neither the employee nor Vodacom was the true inventor thereof.

Software piracy is a serious issue, and it has previously been reported by BSA, a non-profit trade association that protects the intellectual property rights of software providers, that millions of rands were paid in the past year alone by South African companies that made use of unlicensed software.

Legal counsel for BSA has been quoted as saying "software piracy negatively impacts software publishers and creates unfair competition for legitimate companies. It exposes organisations to legal, financial and reputational damage through security breaches and data loss." This is rather unfortunate. Some of these companies were ordered to pay damages for intellectual property right infringement.

This, again, clearly highlights the importance of protecting software and technology developments – even though right holders may not be aware of the infringement of their rights, there are various remedies available to them should the infringement be discovered.

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