Companies have been using software patents as strategic tools to further commercial interests in several ways.
• They can prevent competition from using innovations, by flaunting the patent itself or with threats of litigation in case of infringement.
• By issuing licenses, they can earn ample royalties and /or other recompense.
• A company can barter its rights for other forms of property like trademarks, copyrights and trade secrets, as well as manufacturing or distribution rights, equipment, and services.
• A patent portfolio can attract prospective investors and result in increased financing or financing at very favorable terms.
Software Patent Vs copyright & trade secret protection
Of late, a number of thinkers have been saying that copyright is good, and enough protection for software. But the justification patent-mongers provide is that ownership of software copyright merely means protection of the expression of the code, and not its functional aspects. The idea or concept contained therein is still adaptable by competent peers, using methods such as reverse engineering. A software patent grants that exclusive right to the patentee by which the algorithm, structures and user interfaces as well as the code are completely protected, whereas copyright is merely a means to prevent direct copying.
A trade secret protection entails contracts with all parties involved in the technology, like employees, consultants, distributors and even users. It will also require imposition of information access limitations on all these parties. No amount of care will ensure complete fail-safety that these measures will require.