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NEWS FLASH: //Check our latest course offering on Patent-Business-Strategy over at Udemy here: http://www.udemy.com/patent-business-strategy/ with a 50 per cent launch discount // A collection of articles on patents, software and technology.

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Page 1: Select Patent Issues

Page 1 © Hasit Seth, 2010

Select Patent Issues

Hasit Seth

Hasit Seth

[email protected] www.coofluence.com

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Page 2 © Hasit Seth, 2010

These are some of my writing on patents. They were first published on an email

discussion list “commons-law”. While they mostly deal with software patents issues,

the focus is always on the core patent principles. Your questions and comments are

welcome at [email protected] .

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One

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Why do we have a patent system?

Patent law has three goals, viz., 1. Encourage disclosure and dissemination of

scientific and technical knowledge, and hence create a public domain; 2. Create a

central public repository of knowledge by providing a secure and long-lasting public

domain repository; 3. Provide incentives to the inventors in return for his/her agreeing

to disclose his/her invention to the public. This is the "patent is a contract/barter

between government and inventor" view of patent system.

Another, view is that patents are a "currency for inventions" in the sense that

if an inventor has a patent then he/she can specifically license rights to those patents

to others. Without such a concrete "currency" form of invention, it would require a

new type of contract each time the rights to the invention need to be transferred. In

many instances, this contract will have to be negotiated afresh each time a license is to

be granted.

Under US patent law, a patent is considered to be a "right to exclude" and not

a right to exclusively make something. Patent is a valuable proprietary right in

practical commerce and industry, whatever are its theoretical foundations. I do not

know if considering patent as a property really causes "confusion". To me question is

whether patent law (or some part of it) is hampering or promoting quantity and quality

of inventions and innovations?

The 1970 Act defines "invention" in the sense of "patentable inventions". It does

not mean that other inventions not covered by the Act are non-inventions. It just

means by inference that inventions not covered by the Act are "non-patentable

inventions".

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Two

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Patents grapple with new technology

I have great respect for Richard Stallman (RMS). Not just as a great

programmer (GNU and Emacs) but also as a visionary who envisioned that free

software is a practical idea.

There is enough buzz about anti-software patents that it is hard to answer so

many concerns. Why are patents a problem only in two areas of software and

pharma-biotech? Patents over mechanical, chemical, electronic, electrical

technologies seem to have no problem for those who oppose software and pharma

biotech patents. In theory a mechanic with screws, nut-bolts, welding machine, sheet

metal and a forging press should be able to create airplanes, cars and what not. Such

a mechanic would be infringing thousands of patents. Take a chemist, who has a

periodic table and bottles of all the elements listed there, could theoretically make

every possible patented medicine. But this has never been a concern because the

innovation in these areas is complex. Common sense tells us that making an

argument for such a hypothetical super-mechanic or chemist is naive, since inventing

is hardly so obvious as to hamper other inventor’s innovations.

The computer you are using has probably hundreds of patented IC circuits,

and the Intel/AMD/VIA processor inside it has hundreds of patents protecting it.

Some circuit designers may be hampered by these patented processors in their goal to

design a new processor. One solution is that they can license the patents. But other

solution is what the patent system really wants you to do - invent around it, design

around it, make your own invention. This is the key, but being "obstructionist" in

appearance, patents really encourage more innovation by forcing inventors to find

new ways towards the same goal.

In a sense this is economic waste, why reinvent the wheel? But wheel since

the ancient time has not remained the same, think that Goodyear was not allowed to

make wooden wheels due to a hypothetical patent and that led him to develop the

rubber process that ultimately led to pneumatic rubber tires - that would be innovation

though the imaginary wheel patent was "obstructionist". Story goes that in 19th

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century one US patent officer recommended that the patent office be closed since all

that was to be invented was already done and nothing more remained. But innovation

and invention is a never ending source. We humans are masters of finding new ways

of solving problems. Plus, some alternative that was developed due to a patent hurdle

may be useful in some other field, who knows? Since innovation is incremental, more

patent disclosures (now within 18 months a patent is filed it gets published for others

to learn) provide scientists and engineers even greater base to invent more.

Now software programmers do feel like this: “does that mean that I have to

read a thousand patents before I write a 1000 line program?” Compare software

innovation with the microprocessor and wheel situations, a lot of answers are there -

though not all.

Pharma-biotech patents concerns morality and social issues (arguments of

type: should a dying person be not able to get medicine just because it is expensive

and patented). It is a question of economics of invention and social policy about

health; hence, they are out of context when considering software patents. But software

patents are something else. Here is my take on this topic. First, because of internet

and cheap computers, any one can create even a complex operating system. Well Bill

Gates did it (MS-DOS) and so did Linus Torvalds (Linux). The entry barrier to

creating a complex software invention is very low, and hence there is a valid

argument for freedom to write software without worrying about patents. If I alone

can do it why should I not be able to do it?

Second, the whole argument got momentum because of a stupid job done by

U.S. Patent Office in examining the inventions and granting a lot of initial patents

without looking at prior art. The fault lies in examining software patents before

issuance, rather than anything innately wrong with software patents. Otherwise, all

sorts of mechanical and chemical patents too would be troublesome to inventors in

those fields and to the public at large.

Third, it is also a question of time. Software sprang up in last 20-30 years at a

pace unmatched by any other technology. This meant that initially the patent offices

had very little prior patents to rely on in rejecting the early patent applications and

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offices didn't have trained examiners who knew a lot of software technical literature

to reject those patent applications. Over time, a large pool of prior patents will

become available and those in patent practice are already finding it terribly hard to get

very broad patents issued. More the prior art, narrower the patents, and more is the

inventive freedom to design around it.

Fourth, lexicon is a problem with software. It is hard to express software

elements in terms of language. Today, every programmer can recognize terms like

parsers, browsers, protocol, kernel etc., and one cannot even think of getting a patent

on these. But software develops at rapid pace, and words do not exist most of the

time to describe a lot of software. This ends up in a patent office as a broadly

described software patent which claims the result but not the process by which it is

achieved. This is just a matter of time, just like mechanical and chemical fields,

terminology will become standardized, and we will see a lot of less broad software

patents.

Fifth, the level of disclosure detail required by patent office. Until early 20th

century, US Patent office required the inventors to submit actual models of their

invention. They discontinued this practice since mechanical inventions got narrower

and narrower and for logistics reasons. For biotech inventions, sequence listing are

required to be deposited. I wish they required this for software too, so that it is not

claimed at the level of an idea but an actual method backed by program listing or

pseudo-code to back it up.

Sixth, physical nature of software is unlike a chemical or a machine. It is

expressed in writing, which as RMS mentions should be protected by copyright.

Though it is writing, it is a set of instructions that makes a computer behave in

particular way. Hence, it is also functional, and copyright does not extend to

functional stuff, but expressions.

Seventh, so much of open source software is being developed without

software patent posing as problems. SCO v. IBM battle is hardly about specific

software patents, but more about copyright/code theft. Java virtual machine

architecture from Sun exists and so does virtual machines from Microsoft's .NET

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virtual machines. Though empirical, this does point out that the problem is not an

epidemic that has paralyzed software development around the world.

Eight, tons of stuff can be said about the way the patents are enforced. Getting

a patent is just the beginning. To enforce it is a bigger problem, perhaps than

defending it. Keeping aside the high American legal fee issues, patents with broad to

narrow scopes keep getting invalidated in courts all the time. An issued patent when

litigated gets attacked by a million pieces of prior art (which can include even an

obscure PhD thesis dated before the invention in a small library of a tiny college in

some little country barely visible on a map, provided it is catalogued and accessible)

and not just those that were available to the examiner. In short, enforcing a patent is a

Herculean task, and it is no wonder that many broad patent enforcement suits died

before being harmful in anyway to innovation. There is a lot more to be said about

this. I will do that at some later time.

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Three

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Baseless Arguments

This piece is about software being patentable in India. Indian stance on

software patents is heavily influenced by European position about software patents.

Partly this is due to Indian law’s umbilical cord relationship to English law, and partly

because opposing something coming out of “capitalist evil” America is a must for a

large class of academia, government and businesses all of whom follow left oriented

thought process.

One, Europe and European politicians are not opposing software patents out of

some noble cause, it is pure politics. American dominance in software is well-known.

Japanese dominate the hardware-electronics business and Americans the software,

and Europeans dominate none of this. The companies Philips, Infineon, Siemens,

Nokia, Ericsson, SAP dominate bits and pieces of markets but do not own the

software market even in a single vertical market. Hence, they are motivated to not

enact software patents to deny America the competitive space. To assume that there

is something gravely dangerous about software patents because Europeans are

opposing just means closing eyes and ears to the political side of software-hardware

global market. Americans are championing software patents since their IP licensing

revenues are greater even more than their other chief export: Aircrafts.

Second, even Europe is comfortable with software-hardware combinations

that have some "technical effect". To assume that there is some iron-curtain between

software and hardware means ignoring technical realities. Software today exists in

many forms - including hardware! I am talking about FPGAs (Field Programmable

Gate Arrays) that are configurable chips that can take on role of many hardware

elements when programmed in a certain way. Embedded software is hardware and

software fused together. If these are patentable, then it makes little sense to oppose

software patents purely because of the form of software ("pure software" and not

hardware-software combination).

Third, from a technologist’s point of view, it is unfathomable as to why

patents should be allowed or are even good for hardware but not software? Both are

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technical inventions after all. If I write a great piece of software, as an inventor, I feel

I should be able to maximize my returns on my invention. Some charitable guys will

donate their work, but a lot of inventors want money. Even companies who provide

salaries to inventors or invest in heavy R&D costs deserve returns for their

investments. Also, research is a little gambling type of work, sometimes years to

draining money does not bring up a product that can earn money. Thousands of

software companies sunk money in so-called Artificial Intelligence research but came

up with almost no tangible benefits.

Fourth, I just do not understand a fundamental issue. Markets or Bazaar has

existed since early human times. Property, Contract-Barter and Market are notions

that are well-entrenched in all cultures. Why is then software and patentable software

such a terrible problem, when all it does is what is done for other inventions,

chemical, mechanical and so on? Some aspects of human knowledge have existed

purely in the public domain and have grown - examples: Mathematics, Geology and

Theoretical Physics. Some other aspects are in hybrid (public-private) domain -

chemistry, applied physics (electronics), and they too have developed. To claim that

certain branches of human knowledge can ONLY grow in public domain seems to

against established history. Software, as most applied sciences, has grown in public-

private domain and will continue to do so. To assume that patenting will kill all

public domain side of software is not right. Most of the applied sciences have not had

their public domain side killed. It is rather an issue of maturity and time which

determines in which domain an applied science will grow.

Fifth, free software is doing great stuff, but it is hardly inventing new stuff.

This is a sweeping generalization; I know that, but I am making a very general

observation. Right from BSD and GNU cloning UNIX, Open Office closing MS-

Office, KDE/GNOME extending X-windows to operate like windows, are hardly

inventions, but just reapplications. Yes, there are thousands of internal pieces of these

software that may be inventions, but we are talking about fundamental breakthroughs.

Some problems in software, such as speech recognition, handwriting recognition,

artificial intelligence, have been researched both in public and private domain but no

great breakthroughs have come forward in either domain. Just because software for

these applications is or is not in public domain has not stopped research in this field.

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Sixith, my concern is to develop a set of policies that will maximize

innovation - either in public domain, private domain or both. If exclusive public

domain model of innovation gives the best return then let there be no software

patents. But the fact is that BOTH public and private software development have

gives us huge jumps (UNIX was proprietary work; and Internet/TCP/IP was public

work). If the private model needs software patents to maximize its returns then they

are fine, but I do not think that granting patents is going to kill the public domain side

of programming. Programming is to an extent writing, expression, engineering all

mixed together, it is far more fundamentally human than most people think. Hence,

public domain side of programming will always remain active. Software patents will

lead to more public alternatives, and more public alternatives will mean even more

better private company software products. Just as Linux is forcing Microsoft to create

more and more secure Windows platform. This is a chain reaction, and it raising

software innovation all the time.

Seventh, software companies do not need software patents as their main tool

of business like pharmaceutical companies do. One fundamental aspect of software

today is its "BLACKBOXED" nature. Most software is complied and does not exist

in source form. Microsoft does not need patents to do its day to day business of

selling Windows software since it is complied and exists in a binary form, almost

impossible to reverse engineer. Hence, do not think that software patents are bread

and butter for software companies. Further, the web-software like Google which

exists as a service is even more opaque than complied software to need software

patents to protect its internal algorithms.

It would be disastrous for India to follow the lead of Europe, for the sake of

following something, in software patents. Nations have certain competencies, and its

policies must help enhance and maintain those competencies. India’s software

industry is India’s competency, if our patent policies are not going to take Indian

software industry to the next level, what use is this Indian patent system for?

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Four

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Can’t Have the Cake? Eat the Bread

There is a misconception that software since most of it exists in written form

needs only copyright protection like written or other expressive works do. But

software isn't literature. Looks can be deceiving applies here! It is a set of functional

instructions that customizes a computer to behave in a certain way. Now this set of

instructions is an embodiment or application of new techniques (can be processing

oriented - e.g, distributive data processing; mathematical - e.g., superior encryption or

data compression methods; computational, graphical, controlling - some embedded

machine control; and what not since software-hardware is programmable and so

versatile).

Today software is expressed in words because that is the most convenient way to do

it today. But with times paradigms for programming will change, may be it will

become manipulation of diagrams or even direct manipulation of FPGA like circuits

or quantum computing with different interfaces and not just zillion lines of code. Will

copyright be sufficient to protect those things? But more than that copyright protects

just expression of ideas, i.e., and not invention. I am sure no one will argue that

copyrightable expression and invention are pretty much the same things - just read a

patent or talk to an inventor and not an anti-patent activist!

The copyright-is-sufficient-for-software hangover is from the days when

people didn't understand how much software can do. Most people viewed computers

as nothing more than sophisticated calculators and calculators calculate, so

instructions to do that are nothing more than mathematics, therefore mental process,

and therefore ideas of nature etc were the logical steps in old thinking. But as

sciences develop they acquire their own identity. For example, 100 years ago

electronics as a separate branch of science or "electronic inventions" would be funny

because most of it was physics about gaseous vaccum tubes. With invention of

transistor, ICs, this changed. We do not now view electronic inventions as just mere

expressions of principles of physics.

Most arguments against software patents are divorced from history of invention and

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market place for inventions. It is always instructive to view software patents in

context of history of innovation and patenting in chemical, mechanical and electrical-

electronics fields.

It is not about following America. It just happens that most software (systems or

tools variety - not application) originates and is used in America historically. After all

they developed this field to a large extent. Hence, the debate arose in America. Also,

note that it was not the US government which approved software patents, but it was

judiciary in the State Street Bank case which opened this field for patenting.

The David vs. Goliath, small guy vs. big guys, argument has appealed to us

humans since time immemorial. It may seem that patents are tools of big

corporations, especially American multinationals. Well they are, because so much of

industrial research is conducted in the private sector in America. And some

breathtaking inventions have occurred (Edison's inventions, AT&T Bell Labs, Xerox

PARC, etc) in private sector and based on the economy of private sector patents are

good to protect investments. Software presents a unique opportunity to create

inventions and innovative spirit in developing countries, because it does not need

material resources of the west in other inventive spheres say like electronics or

chemistry. Software is a great leveler. India's $16bn software exports are a testimony

to that fact. Instead of worrying about theoretical foundations, activist

scaremongering, it is time to create some great software in India and earn good

money. Whether this goes to small developer’s pockets or some small or large

companies is irrelevant, more important is to start the chain reaction of innovation,

marketing, improvement in software in India and other developing countries.

Patents are going to have a minor role as future of software and computing

matures. Hence, this debate will also decimate itself in time.

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Five

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O Indian, Compete, Nay Whine

The amendment to patent act providing for "software related patent" is indeed badly

drafted if the intent was only to grant patents for embedded software because

legislative intention should be clear in policy matters.

That said it is amazing to contrast constitutional approaches to innovation. American

constitution explicitly provides for patent and copyright protection to promote

invention. And an argument below seeks to show that the Art. 39 of the Indian

Constitution seeks to promote socialism's goals and somehow that is anti-patent. Imn

Art. 51A(h) there is a directive policy that states that state shall endeavor to increase

scientific temper.

I am yet to see a cohesive argument with economics that shows that cumulatively

patents in the broad fields of mechanical, chemical, electrical-electronics invention

have somehow created havoc in the Indian society. Take agriculture for example,

pesticides can be patented, seed manufacturing technology can be patented,

mechanical inventions such as tractors, harvesters can be patented but there has been

no large scale havoc caused by such patents. And we can all agree that agriculture is

the most basic, pervasive economic activity in India affecting everyone.

Why then will software patents create a catastrophe? There is an argument in the

excerpt below that software industry is living in peaceful Alice-in-wonderland and

patents will "disturb the peace prevailing in the software field, and may raise

contentious disputes between various hardware manufacturers, software developers

and entities". So what, big deal? Software is business like any other business, and if

other businesses have patent regimes why should software business be any different?

Does any one remember the Indian nationalized bank employees’ union agitation (in

around '80s) against "computerization" that will destroy the labor rights? Nationalized

bank union extorted money as compensation for allowing computers in banks!!! Then

there was a stir in railways when computerized reservation was introduced. The scare

tactic below is just one of those types. Where has computerization destroyed labor in

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banks? or in railway reservation. Sure computers mean less number of clerks are

needed to transfer entries from receipts to general ledgers in banks, but look at the

customer service you are getting in banks and railway reservations due to

computerization. These are but just few examples of anti-technology and anti-

innovation attitudes.

I mention this because somehow there is a pervasive belief that innovation and

invention in any form will destroy the existing social and economic structures in

India. At the risk of making a sweeping generalization, if only the hyperbole can

drive home the point: There are more anti-innovation activists than innovators in

India. (I am not speaking of European innovation - its opposition to software patents,

because that has more to do with Europe's business competitiveness with US in

software) Patents are a one policy tool to promote invention and innovation. There

are many other policy tools that control, destroy and promote invention, e.g.,

subsidies, licensing, finance, taxation, moral issues, labor and so on. Patents are not

the atom bombs they are made out to be of monopolistic control.

While patents sound in theory to have huge monopolistic power (and they do in some

fields like pharmaceuticals, no denying that) in most fields they have only marginal

market control power. There are two reasons for the patent coverage: One, language

restricts capturing patent rights. All said and done, patent is a piece of written

document. It is just not possible to "own" a technology field through a single patent

or patents for a substantial length of time. The more you claim in a patent claim,

more chances you get a stupid patent with tons of prior art reading on it. Thirdly, any

lawyer will tell you that a written document creating or transferring legal

rights/obligations will have no guaranteed interpretation by a court. Patents are no

different. Statistics are available in US that show huge number of patents being

invalidated in courts - day in and day out.

Two, technology has always competing alternatives. For far too many fields same

result can be achieved by multiple and different techniques. For example, if LZW

algorithm and GIF file formats were patented by Unisys, the free software community

came up with its own format PNG, and not to mention there are zillion graphic file

formats - TIFF, JPEG, PCX, DWG and so on - from standard groups, private

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companies, and so on. Same is the story with encryption. Most patenting is not

simple as shown in WIPO's comic book about patents! But in some fields patents can

be counterproductive, for example, if TCP/IP was patented then it would have taken

some time for someone to come up with a competing alternative with the wide

acceptance level of TCP/IP. Medicines are another example, developing a new

competing molecule takes billions of dollars and years of clinical and chemical

research. I would be first to say that innovation and invention can be very disruptive.

Inventions (truly big ones) like most big social, economic and political ideas have

power to change the human life in a drastic way. This is because science, technology

and invention does not follow social rules or morality in evolving. Atomic science just

developed without any connection with dangerous social effects as history showed.

Industrial revolution in Europe wrecked havoc on small artisans in India. We can

choose to remain in isolation, or we can join in innovation race. And first price to pay

is shedding of anti-innovation and anti invention bias. We have the capability and fire

to be as innovative as Japanese, Taiwanese, American, European and other inventors.

Do we want to become history or do we want to create history on our own terms?

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Six

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Can’t Just Ignore the History

I am not a big fan of Microsoft but as a computer enthusiast I find that

characterization of Gates and Microsoft in early PC history can’t be just wished away.

Microsoft's DOS OS was the prime reason for personal computing being affordable

today. CP/M the only major "PC" OS around at the time was proprietary. IBM's PC

DOS (developed by MS) was expensive (or impossible at one stage) for PC Clone

makers to license through IBM. Apple being the paragon of proprietary stuff had no

interest (and still doesn't have) in licensing its OSs. MS-DOS is what ran the PC-

Clone market. The technical merits of MS-DOS are a different topic, and GNU

certainly didn't make personal computing happen. If one understands the difficulty

that Linux is facing today in supporting thousands of different types of hardware

devices from multiple vendors, there lies the historical value of MS-DOS and

Microsoft. Linux enthusiasts are doing an admirable job of supporting drivers for a

lot of hardware but still a lot needs to be done (e.g., Wireless cards with proprietary

firmware are a pain to setup). DOS ran on every kind of PC clone, and Windows still

supports the widest variety of garden hardware. Yes, MS monopolized the Windows

application market, but this deserves a closer look. But before that on DOS platform,

MS just provided the OS - the Word-processing package was Wordstar, the

Spreadsheet was Lotus 1-2-3 and The Database was dBase III+ - all non-MS

applications. All these non-MS application makers were quite slow in releasing their

Windows versions. Most were so wedded to the text based MS-DOS that they just

could not make the transition fast enough (e.g, dBase III+ or Wordstar). Nobody

wanted to develop applications for Windows till Windows 3.1 became popular. MS

filled in this space (of course with head start from knowing Windows codebase) with

acceptable applications such as Word and Excel. Developing these Apps is hardly a

trivial task where one can say that MS just hacked together a few pieces of off-shelf

software. Just look at the effort required in OpenOffice to understand the nature of

the task. Other OS Vendors lost faith in the PC market - principal being IBM with a

much superior offering of OS/2. MS continued developing both OS and App market,

with entry barriers getting higher and higher for other players. Sure they were

monopolistic, but just look at Apple or IBM in similar circumstances and they are no

different.

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Software is not easy to develop, especially complex and large applications. For

example, GNU's Hurd kernel is years in making without any end in sight. It is just a

damn tough job. Linux enthusiasts will rave about Vi and Emacs, GNU CC and

Make as all that you need to develop applications. That may be so for some good

cases. But MS's contribution, from a purely technical and developer productivity

viewpoint, in Visual Basic is just immense. Nothing comes close in ease of

developing a GUI app - whether free or proprietary application. I know there is an

ongoing Gambas project to close Visual Basic, but then like most open source

projects it is a cloning effort. And Hypercard for Apple unfortunately didn’t become a

dominant player.

If we accuse of MS of rehashing and repackaging existing technology, open source

software is no different with their best efforts being admirable clones (some better,

some worse) of existing proprietary OS’ or applications. While MS is a terrible

company in some its tactics, and a classic monopolist at many times, its historical role

in bringing affordable computing to masses cannot be just wished away.