Choice of Copyright and Patent Licensing for Taxpayer-Funded Research

Author: Bruce Perens (Contact info); Senior Research Scientist; Cyber Security Policy Research Institute; George Washington University

Government-funded research is taxpayer-funded research. The taxpayers should thus be able to make use of the unclassified research that they have paid for. Sometimes researchers create software. Recently, some taxpayer-funded research software has been placed under Open Source licenses. Open Source licensing has the potential to provide equal and fair access to government research to all taxpayers, but the choice of license determines the terms of that access.

Producers of proprietary software have criticized the use of some Open Source licenses, because they feel that the terms of those licenses are anti-commercial. In this paper, I discuss three different Open Source licenses that can be applied to taxpayer-funded research, and their policy implications, and recommend a particular license as the most fair to all parties.

Taxpayer-funded research also results in inventions which are patented by the researchers. Some of these are "software patents", which cover computer algorithms and their applications.

Efficiency of Technology Transfer

One of the goals of unclassified taxpayer-funded research is the transfer of technology to the general public. Under the Bayh-Dole act, technology is often transferred to one private-sector business exclusively, rather than to all businesses and individuals inclusively.

In productizing a mechanical or chemical invention, there may be a large investment necessary to bring the technology to the point that it is suitable for mass production. The rationale behind Bayh-Dole is that it is less likley that any business would make such a large investment without the promise of a monopoly on the result. Thus, Bayh-Dole encourages, but does not require, producers of taxpayer-funded research to convey the monopoly rights on that research to a single company.

The research organizations that grant rights on taxpayer-funded work should endeavor to balance the merit of transferring research to the public with the detriment of creating a monopoly that may actually impede that transfer. A failed effort to productize technology, coupled with a monopoly right on that technology, can result in the monopoly holder blocking all use of the technology by anyone. An unnecessarily blocked technology is a waste of taxpayer dollars and a hinderance to industry. Should a second company succeed in developing the technology, that company would have to purchase a license from the first at an arbitrary price. Even in the case where productization succeeds, the monopoly holder is allowed to set an arbitrary price. The artificially high prices that result from monopolies are economicaly inefficient, and thus the transfer of technology to the public will tend to be less than optimal.

Rights should be transferred as a monopoly only when it is clear that it would require a large investment to productize a particular research work, and that such an effort is likely to be successful in transferring the benefit of a technology to the general public. When this is not the case, rights should be transferred to all of the public on a royalty-free basis.

It is less clear that a monopoly right is necessary to promote the investment necessary to productize software. Productization of software often entails the improvement of ease-of-use, the removal of failure modes that are acceptable to researchers but not to actual users, and documentation of the product. This is not as large an investement as would be required to productize many non-software inventions.

It is well within the scope of the Open Source developer community to productize most software using volunteers and industry collaborations, with little overall investment. For example, that community has developed two complete GUI desktops, a number of operating system kernels, office software, and an online encyclopedia, all of excellent quality and avalaible for everyone to use, modify, and redistribute without any royalty or fee.

Businesses and individual collaborators have invested their time to make these projects come about, but because of the distributed nature of the work, no single collaborator invests very much. Most of the business collaborators treat software as a cost-center, because their main business is not the sale of software. They amortize their participation in Open Source communities with the profits they derive from making use of the software in their business.

Copyright Licensing

Copyrighted software is a regular product of research, and the software copyrignt is often transferred to a single business as a monopoly right. Recently, some of that software has been transferred to the public under an Open Source license. The choice of Open Source license controls the terms of the technology transfer. Here I examine three popular licenses, and their effects upon the technology transfer.

The GPL

The GPL, or GNU General Public License, used on the Linux kernel, compels that the work must be freely usable, modifiable, and distributable by everyone. In addition, derived works of a GPL program must be available under terms no more restrictive than those in the GPL. Thus, the GPL enforces a share-and-share-alike paradigm among programmers. This maximizes distribution of the work and further collaboration in its development by the Open Source developer community. On the other hand, it discourages the proprietary software paradigm of monetizing the production of software with a license payment. There is no way to compel someone to pay for a work that they can get elsewhere without charge. Thus, software manufacturers that deal in GPL-licensed software must derive their profits from something other than a direct revenue capture for unit sales of software. They sell service and customization, training, sales of hardware enabled by the GPL software, sales of non-GPL software alongside the GPL works, or some other business.

The application of the GPL to the Linux kernel does not encumber Linux applications. Because the GPL does not apply to programs that are simply aggregated on the same disk with a GPL work, it is possible to use programs under any license whatsoever along with the Linux operating system kernel, which is not linked directly to those applications. Thus, a healthy market for proprietary Linux applications is possible even though the Linux kernel is covered by the GPL.

Some proprietary software manufacturers feel that application of the GPL license to taxpayer-funded software development is unfair to them. They are taxpayers too, they say, and should have the right to integrate the fruits of government research into their own proprietary software works. On the other hand, the transfer of taxpayer-funded software to proprietary businesses may result in the end-user paying for technology twice: once with their taxes, and a second time when they purchase a software product containing that technology.

The LGPL

The LGPL, or Lesser GNU General Public License, creates a compromise in which both free and proprietary software can participate. The LGPL has similar terms to the GPL, except that works under any license can be combined with works under the LGPL license through the linking of software object files. Thus, a software program might have some files that are under the LGPL, and some that are under a proprietary license. If taxpayer-funded software is placed under the LGPL, the fruits of government-funded software development will remain free for everyone's use, while proprietary additions to that research can be placed under any license at all. Thus, the LGPL should not elicit the same sort of objection from proprietary software producers as the GPL.

The LGPL license is compatible with the GPL. For example, works intended for inclusion in the Linux kernel can be placed under the LGPL license, and can then be used with proprietary kernels as well as Linux.

The MIT License

The MIT license is essentially a gift, in that programs under it can be used for any purpose, and can be relicensed under any terms. Programs under the MIT license are compatible with the GPL.