As soon as you create a work in a tangible medium, such as a computer file, you have copyright in that work. Copyright protection gives the owner or licensee the right to control how other entities display, perform, distribute, copy, or create derivatives of the work.
Historically, most software is released under copyright licenses, and no further protection under patent law is utilized. Factors such as first mover advantage, understanding a particular market niche, or controlling distribution channels are used to gain market advantage.
If software implements a patentable invention, the additional step of filing for a patent to protect the intellectual property in this second way as well is worth careful consideration. Patent applications typically cost $30,000-$50,000 over their lifetime for coverage in the US alone, and take several years to issue. In addition, the inventors must invest considerable time during the drafting and defense of the patent application in order to achieve broad useful patent claims In return for this investment, patents offer stronger intellectual property protection than copyrights as they protect the idea itself and not simply its implementation in code, giving the patent owner or licensee the right to control how other entities make, use, sell, offer for sale or import a device or method claimed by the patent.
A patent, if issued, allows the owner to prohibit others from using the patented invention. For software, the patented invention is often a method of calculating something. The copyright protects the actual code itself, but would not stop someone else from creating their own code that implemented the same method. Depending on the specific software, desired commercialization pathway, and time to market, the additional step of pursuing a patent may or may not be worth the added expense.
Here are some cases when the value of the additional protection offered by a patent may justify the additional time and money required to apply for the patent:
Here are some reasons your code may be valuable but may not justify the additional protection offered by a patent given the cost and time commitment of applying for the patent:
When considering whether to file for patent protection, the following questions apply particularly to software inventions:
Copyright v. Patent: A Primer on Copyright and Patent Protection for Software (http://www.law.washington.edu/lta/swp/law/copyvpatent.html)
The Patent Approach of Stanford's OTL: If no licensee is reimbursing patent costs (http://otl.stanford.edu/inventors/resources/inventors_patapp.html)