Chapter 15 • Social, Ethical, and Legal Issues 587other universal truths. We used to think of patents as pro-
tecting the inventors of machines, but in recent years some
very strange things have been granted patents: plants, ani-
mals, and even genes.
Patenting computer programs has had a controversial
history. At first, courts viewed computer programs as algo-
rithms similar to mathematical algorithms that cannot be
patented. However, in recent years the U.S. Patent Office
has begun to issue patents on computer-implemented
processes. For example, Amazon.com was issued a patent
on “one-click ordering” on the Web: If you are a previous
customer, Amazon.com retrieves a cookie to locate its
record containing your name, address, and credit card
number and thus can process your order without you having
to reenter that information. That process seems obvious
today, as cookies are being widely used for many similar
purposes, but the patent was issued in the mid-1990s.
Amazon.com sued Barnes and Noble over infringement of
this patent, but in March 2002 the suit was settled out of
court so that patent has not yet been tested in court.
Over the past several years, software patents have
been a contentious issue in the European Parliament, and the
outcome is still in doubt. However, in the United States each
year thousands of computer programs and basic business
processes are parented by such software giants as Microsoft
and IBM. IBM alone was issued over 4,900 patents in 2009,
a substantial number of which were computer program
patents. This has created a great deal of controversy because
it can inhibit the growth of small software firms who do not
have the resources to find their way through the maze of
what is allowable and what is not or to defend against
infringement lawsuits. With so many software patents
granted, how can any software developer be confident that
he or she has not infringed on one or more of them without
employing an army of lawyers?
In May 2007, Microsoft executives asserted that 235
Microsoft patents were being infringed by the Linux oper-
ating system, OpenOffice desktop applications, and other
open-source programs. The executives declined to specify
what patents had been violated by whom and said that they
had no present intentions to sue to enforce these patents.
However, this announcement provoked a firestorm of
reactions, some asserting that if Microsoft decided to liti-
gate, it would open the floodgates of countersuits and that
Microsoft’s vast trove of patents would be at risk.
Nevertheless, this announcement cast a pall over the open-
source software community, scared smaller software
developers, and disturbed large Microsoft customers that
are using some popular open-source software. Many
persons contend that if this explosion of software patents
continues, society will suffer because innovation will be
limited and monopoly power will be encouraged.
The U.S. Patent Office denied an application by
partners Bilski and Warsaw for a computerized business
process. This rejection was appealed through the patent
office and the District Court and was argued before the
U.S. Supreme Court in November 2009. In June 2010 the
Supreme Court rejected the appeal, but it does not appear
that the decision offers any clear guidelines as to under
what conditions software is patentable.Digital Entertainment Piracy
Growing volumes of digital music, digital videos, and digital
movies are being pirated worldwide. In developing countries,
much of this piracy is carried out by copying or counter-
feiting CD and DVD disks. The International Federation of
the Phonographic Industry (IFPI), which represents the inter-
national recording industry, participates in the identification
and prosecution of piracy operations, and it has had some
successes. According to IFPI, 28 percent of all CDs sold
worldwide in 2002 were pirated, and music piracy was a
$4.3 billion industry (IFPI, 2003). CD piracy rates vary
widely from country to country, from over 90 percent in
Indonesia and Paraguay down to less than 10 percent in the
United States, Japan, and most of Western Europe.Internet File Sharing
In the United States and much of the world, the major
problem for the recording industry is file sharing on the
Internet. IFPI claims that 40 billion songs were illegally
downloaded in 2008—95 percent of all music downloads
(IFPI, 2009). Sharing entertainment files on the Internet
has become an emotional and contentious issue, with
some claiming that it is leading to the demise of the enter-
tainment industry as we know it and others claiming that
the industry can continue to prosper and even profit from
downloading. Still others rejoice and say “who cares” (see
the box entitled “Free Digital Entertainment!”).
The Recording Industry Association of America
(RIAA) has launched a crusade against sharing music on
the Internet, undertaking a publicity and educational cam-
paign, lobbying lawmakers for help, and instituting legal
action against those trafficking in copyrighted files. The
RIAA claims that sales revenues of recorded music in the
United States were down 42 percent from 1999 to 2008—
primarily because of illegal downloading. Although this
precipitous drop in revenue may not be entirely due to ille-
gal downloading, there is little question that it has been a
major factor. The recording industry is in disarray, and it is
not clear how it will shake out.
Swapping music on the Internet gained widespread
popularity with the advent of Napster. Napster developed