EC FLOSS Study Sections 2-5: Go FLOSS, Innovate, Beat the U.S.

Last week, we announced our intention to be one of the first to give the European Commission’s FLOSS report the attention it deserves and actually read and analyze the entire 287 page report. Our goal is to go beyond the executive summary and provide a sober analysis of the report and start a real conversation about what it means. As the recent disputes over the report suggest, informed analysis is still sorely needed. 

Today we’ll focus on sections 2 through 5, which include the report’s context, objectives, structure of the project team (something we won’t analyze because we want to judge the value of the team’s ideas, not their backgrounds) and methodology. 

To begin our analysis, we should address the focus and purpose of this report, which has often been mischaracterized. Despite what some have claimed, this report is not intended to endorse one licensing model over another, to refute Microsoft’s Get The Facts Campaign, or to suggest the world should go open source. In fact, the authors make the purpose of their research very clear on page 14, in the Objectives section: 

“The study aimed to fill gaps in our understanding of the impact of FLOSS on innovation and competitiveness of the EU ICT sector...” 

Why has the European Commission focused the authors on the ICT sector and FLOSS in particular? The answer to this question is given in the Context section of the paper on page 13: 

“The ICT goods and services sector drives economic growth and the EU’s competitiveness in this sector is therefore an important element of achieving the Lisbon goals of becoming the most competitive knowledge economy by 2010. Within this context…it is useful to better understand the impact of FLOSS on the ICT sector and Europe’s industrial competitiveness.”

In short, this paper is a call to action for Europe’s policymakers, arguing that European commitment to FLOSS is the best strategy to ignite its economy and topple America's current dominance of the ICT industry. The ambitious proposals in the report aim to do for Europe’s ICT industry, what the EADS/Airbus project did for Europe's aeronautics industry.

There is little question that Europe must do something to improve its innovative output if it the member states want to remain competitive in the global economy. Despite committing to the Lisbon Agenda in 2000, the declared ambition to make the EU “the most dynamic and competitive knowledge-based economy in the world by 2010,”

Europe has made little if any progress according to studies. The European Innovation Scoreboard (EIS) 2005 report found that, if trends for the 25 EU nations were to maintain their current pace, the innovation gap versus the U.S. would not be closed for at least another 50 years.[1] The EIS highlights “a consistent innovation gap existing between the European Union and the U.S.” according to the French Office of Science & Technology.[2] And, according to a report from the London School of Economics, the Lisbon Agenda “seems to have made little difference for Europe’s innovation performance.”[3]

This has left many of Europe’s leaders looking for a spark to ignite their ICT sector and fuel community-wide economic growth.

Countries in America and Asia are doing much better than us in developing new markets and new products - gaining the competitive edge.

- Neelie Kroes, European Commissioner for Competition, November 2005.[4] 

It is essential for us to rediscover a taste for risk and pride in innovation.

- French President Jacques Chirac, April 2006.[5]

The authors of the UNU-Merit report argue that an aggressive commitment to FLOSS will provide that spark. Using what the authors suggest is Europe’s competitive advantage in open source developers, the European ICT industry will be able to better compete with America’s ICT leaders.

It is a provocative and ambitious strategy. But is it sound? If the EU desires to adopt FLOSS as its competitive advantage in ICT, would the data and proposals presented in the UNU-MERIT study help? How do they authors support their strategy and in the 274 pages that follow the executive summary?

Those are some of the key questions we hope to answer in the coming weeks. Starting with Section 6 later this week (we’re skipping the executive summary and have addressed most of 2-5 above), we will analyze the report section by section, identifying the value but also the pitfalls of the report.

We are also looking forward to constructive feedback from our readers because this paper and its policy agenda deserve to be topics of conversation, not just bits of rhetoric.

 

---

[1] The European Trendchart on Innovation, European Innovation Scoreboard 2005, executive summary available at http://www.trendchart.org/scoreboards/scoreboard2005/executive_summary.cfm. See also http://www.trendchart.org/scoreboards/scoreboard2005/key_dimensions.cfm.

[2] Office of Science and Technology at the French Embassy in the

US, “France ‘average’ in European Commission Innovation Scorecard”, June 2, 2006, available at http://www.ambafrance-us.org/sst/home/page.asp?LNG=us&target=news&ID=509.

[3] Center for Economic Performance, “Boosting Innovation and Productivity Growth in Europe: The hope and realities of the EU’s ‘Lisbon agenda’”, London School of Economics, September 2006, available at http://cep.lse.ac.uk/briefings/pa_lisbon_agenda.pdf.

[4] Neelie Kroes, “Innovation from a Business Perspective: the State Aid Aspects”, Brussels, Nov. 17, 2005, available at http://europa.eu/rapid/pressReleasesAction.do?reference=SPEECH/05/703&format=HTML&aged=0&language=EN&guiLanguage=en

[5] Jacques Chirac, Parisaddressing French CEOs in  Paris, as quoted in Peter Fairley, “France's Effort to Spawn a New Google”, MIT Technology Review, May 5, 2006, available at http://www.techreview.com/read_article.aspx?ch=biztech&sc=&id=16775&pg=1

Comments

[Charles Hixson]

That the EU has an opportunity is true. I'm not certain that it currently has more FOSS developers, but it easily could have, and it currently has a better legal climate.

Important above all is to maintain the advantageous legal climate. This includes such steps as ensuring that software patents do not appear, or, at minimum, that the requirements for acquiring a software patent be actual, enforced, and tied to specific code. I.e., a patent on a particular implementation is perhaps justifiable. Maybe. A patent on a method is abusive and would result in the EU having no significant advantage over the US.

Also, if software patents are allowed it is important that current applications not be acceptable, as nearly all of them fail several tests.
1) They do not reveal sufficient detail to "make patent" the invention so that anyone "skilled in the craft" could duplicate it.
2) They are excessively broad.
3) They are obvious.
There are probably other flaws, I'm only pointing out the ones that are obvious from across the ocean, and which mirror the defects of the US software patents (and which have already driven several FOSS projects off-shore).

Also, if patents are allowed, then it is very important that a party who is claimed to be infringing has a reasonable opportunity to fix the problem before penalties are assessed. Software engineers don't spend their days studying patents and generally have no idea what patents exist. In the US, at least, patents are written on purpose to be unintelligible, and if you claim to understand what a patent is claiming you risk tripling any assessed penalties.

It would also be worthwhile if copyrights were restrained to a sensible period of time, say 5 years for a copyright on software. Perhaps 10. 15 is getting rediculous. Software changes so rapidly that something 15 years old is archaic.

Personally, I believe that any software that has not been marketed within the past year should be declared open. OTOH, copyrights aren't as damaging to software development as patents are. They are, in the first place, more suited to the medium. (Code is a form of written expression.) Secondly, they are for specific "phrases". They don't block whole avenues. Walt Disney producing a movie about Cinderella doesn't prevent someone else from making a different movie based on the same fairy tale. (And it SHOULDN'T!)

[Joe Murphy]

Part of the problem is that the politicians+bureaucrats are using numbers of patents granted to assess "innovation" in the first place under the "Lisbon Agenda"!

That is obvious idiocy, but they mostly don't know that (or perhaps know that but really want to maximise monopolisation for their real masters in the corporations or something).

The sad fact is, unless a patent is issued for your software, oops sorry "computer implemented invention", they probably aren't considering it to count towards their "innovation" metrics in the first place. Thus, there is, by the metrics usually used by the EC, a huge overestimate of the software innovation in the USA and a huge underestimate of the software innovation in the EU. First and foremost, we have to drive home the point that "Number of patents granted" is not a valid metric of innovation.

With metrics which ARE based on number of patents granted, a pretty line graph showing "Innovation v.s Patents", is basically just a "X versus X" plot, and it's mathematically totally unsurprising you get a "correlation" - but politicans aren't typically mathematically savvy, and the pretty graphs seem to suggest that more patents == more innovation.

[SM]

1) Software patents should under no circumstances have a life of longer than 2 years - about 1/3rd of the useful life of the innovation, instead of as at present 20 years which is about 3 times the useful life of the innovation. It is not the intention of the patent system to grant a monopoly for life - only for the period required to bring the product to market.

2) Software standards, specifications, and protocols should not be patentable. The very point of publishing standards, specifications, and protocols is to allow everyone to use them to be interoperate, or interchangable. Allowing them to be patented renders them unfit for purpose, and should therefore not be supported by the patent office - the intention of patents is to bring innovation in the market, not to render it unfit for it's only puspose as in the case of software standards, specifications and protocols. Rather that allow standards, specifications and protocols to be patented, it is better to simply allow them to be protected by secrecy if the person who hasd the idea does not want them to be used by others since this fosters innovation better by not blocking others in future who are prepared to publish standards, specifications and protocols that are fit for purpose.