"You get value from patents in two ways," says Roger Smith, IBM Assistant General Counsel, intellectual property law. "Through fees, and through licensing negotiations that give IBM access to other patents.

"The IBM patent portfolio gains us the freedom to do what we need to do through cross-licensing .... it gives us access to the inventions of others that are the key to rapid innovation. Access is far more valuable to IBM than the fees it receives from its 9,000 active patents. There's no direct calculation of this value, but it's many times larger than the fee income, perhaps an order of magnitude larger."

This article should dispell the idea that the patent system will "protect" a small software developer from competition from IBM. IBM can always find patents in its collection which the small developer is infringing, and thus obtain a cross-license.

However, the patent system does cause trouble for the smaller companies which, like IBM, need access to patented techniques in order to do useful work in software. Unlike IBM, the smaller companies do not have 9,000 patents and cannot usually get a cross-license. No matter how hard they try, they cannot amass enough patents to defend themselves.

How much trouble do patents typically cause? The value IBM gets from cross-licensing measures the trouble that the patent system would cause IBM if IBM could not avoid it. IBM's estimate is that the trouble could easily be ten times the good one can expect from one's own patents .... even for a company with 9,000 of them.

For IBM, this trouble is hypothetical .... cross-licensing prevents it from happening. For ordinary companies which cannot do likewise, the burden is real. IBM's estimate suggests that for a typical software company, patents will do ten times as much harm as good. Only the elimination of patents from the software field can enable most software developers to continue with their work.