Editing Software patent (section)

===Licensing===
{{Main|Software license}}
{|class="wikitable floatright" style="width:600px;"
|+Total US software patent counts by class of invention as of 2015<ref>{{cite web|url=https://www.uspto.gov/web/offices/ac/ido/oeip/taf/cbcby.htm|title=Patent Counts By Class By Year, CY 1977 - 2015|publisher=United States Patent and Trademark Office|access-date=2017-03-13}}</ref>
|-
!US class
!Description
!Total patents issued
|-
|align="right"|700
|Data Processing: Generic Control Systems or Specific Applications
|align="right"|26042
|-
|align="right"|701
|Data Processing: Vehicles, Navigation, and Relative Location
|align="right"|38566
|-
|align="right"|702
|Data Processing: Measuring, Calibrating, or Testing
|align="right"|27130
|-
|align="right"|703
|Data Processing: Structural Design, Modeling, Simulation, and Emulation
|align="right"|10126
|-
|align="right"|704
|Data Processing: Speech Signal Processing, Linguistics, Language Translation, and Audio Compression/Decompression
|align="right" |17944
|-
|align="right" |705
|Data Processing: Financial, Business Practice, Management, or Cost/Price Determination
|align="right" |38284
|-|align="right"|706
|706
|align="right"|Data Processing: Artificial Intelligence
|9161
|-
|align="right"|707
|Data Processing: Database and File Management or Data Structures
|align="right"|47593
|-
|align="right"|708
|Electrical Computers: Arithmetic Processing and Calculating
|align="right"|9993
|-
|align="right"|709
|Electrical Computers and Digital Processing Systems: Multicomputer Data Transferring
|align="right"|56001
|-
|align="right"|710
|Electrical Computers and Digital Data Processing Systems: Input/Output
|align="right"|23991
|-
|align="right"|711
|Electrical Computers and Digital Processing Systems: Memory
|align="right"|34025
|-
|align="right"|712
|Electrical Computers and Digital Processing Systems: Processing Architectures and Instruction Processing (e.g., Processors)
|align="right"|10461
|-
|align="right"|713
|Electrical Computers and Digital Processing Systems: Support
|align="right"|30695
|-
|align="right"|714
|Error Detection/Correction and Fault Detection/Recovery
|align="right"|38532
|-
|align="right"|715
|Data Processing: Presentation Processing of Document, Operator Interface Processing, and Screen Saver Display Processing
|align="right"|25413
|-
|align="right"|716
|Computer-Aided Design and Analysis of Circuits and Semiconductor Masks
|align="right"|13809
|-
|align="right"|717
|Data Processing: Software Development, Installation, and Management
|align="right"|17336
|-
|align="right"|718
|Electrical Computers and Digital Processing Systems: Virtual Machine Task or Process Management or Task Management/Control
|align="right"|7615
|-
|align="right"|719
|Electrical Computers and Digital Processing Systems: Interprogram Communication or Interprocess Communication (Ipc)
|align="right"|5456
|-
|align="right"|720
|Dynamic Optical Information Storage or Retrieval
|align="right"|3877
|-
|align="right"|725
|Interactive Video Distribution Systems
|align="right"|12076
|-
|726
|Information Security
|21144
|-
!
!align="right"|Total
!525270
|}

Patenting software is widespread in the US. {{As of|2015}}, approximately 500,000 patents had issued in the 23 classes of patents covering "computer implemented inventions" (see table).

Many software companies [[cross-licensing|cross license]] their patents to each other. These agreements allow each party to practice the other party's patented inventions without the threat of being sued for [[patent infringement]]. [[Microsoft]], for example, has agreements with [[IBM]], [[Sun Microsystems|Sun]] (now [[Oracle Corporation|Oracle]]), [[SAP AG|SAP]], [[Hewlett-Packard]], [[Siemens]], [[Cisco Systems|Cisco]], [[Autodesk]],<ref>{{cite web|url=http://www.arn.idg.com.au/index.php?taxid=620938001&id=63439861 |title=Microsoft, Autodesk in patent licensing deal |work=IDG News Service |date=2004-12-17 |url-status=dead |archive-url=https://web.archive.org/web/20130115222332/http://www.arnnet.com.au/article/5043/microsoft_autodesk_patent_licensing_deal/?taxid=620938001 |archive-date=January 15, 2013 |access-date=2012-10-09}}</ref> and recently [[Novell]]. Microsoft cross-licensed its patents with Sun, despite being direct competitors, and with Autodesk even though Autodesk has far fewer patents than Microsoft.

The ability to negotiate cross licensing agreements is a major reason that many software companies, including those providing [[Open-source software|open source]] software, file patents. As of June 2006, for example, [[Red Hat]] had developed a [[patent portfolio|portfolio]] of 10 issued US patents, 1 issued European patent, 163 pending US patent applications, and 33 pending international PCT ([[Patent Cooperation Treaty]]) patent applications. Red Hat uses this portfolio to cross license with proprietary software companies so that they can preserve their freedom to operate.<ref name=autogenerated1 />

Other patent holders are in the business of inventing new "computer implemented inventions" and then commercializing the inventions by licensing the patents to other companies that manufacture the inventions. [[Walker Digital]], for example, has generated a large patent portfolio from its research efforts, including the basic patent on the [[Priceline.com]] reverse auction technology. US universities also fall into this class of patent owners. They collectively generate about $1.4 billion per year through licensing the inventions they develop to both established and start up companies in all fields of technology, including software.<ref>{{citation|url=http://www.autm.net/FY_2004_Licensing_Survey/8932.htm|title=FY 2004 U.S. Licensing Survey|publisher=Association of University Technology Managers|date=2012-09-08|access-date=2012-11-07|archive-date=2012-10-15|archive-url=https://web.archive.org/web/20121015213045/http://www.autm.net/FY_2004_Licensing_Survey/8932.htm|url-status=dead}}</ref>

Still other patent holders focus on obtaining patents from original inventors and licensing them to companies that have introduced commercial products into the marketplace after the patents were filed. Some of these patent holders, such as [[Intellectual Ventures]], are privately held companies financed by large corporations such as Apple, Microsoft, [[Intel]], [[Google]], etc. Others, such as [[Acacia Research|Acacia Technologies]], are publicly traded companies with institutional investors being the primary shareholders.<ref>{{citation|url=http://premium.hoovers.com/subscribe/co/overview.xhtml?ID=fffrfkrhrrxhjcxxkh|title=Acacia Technologies LLC: Company Information|publisher=Hoovers}}{{Dead link|date=December 2021}}</ref>

The practice of acquiring patents merely to license them is controversial in the software industry. Companies that have this business model are pejoratively referred to as [[patent troll]]s. It is an integral part of the business model that patent licensing companies sue infringers that do not take a license. Furthermore, they may take advantage of the fact that many companies will pay a modest license fee (e.g. $100,000 to $1,000,000) for rights to a patent of questionable validity, rather than pay the high legal fees ($2,000,000 or more) to demonstrate in court that the patent is invalid.{{Citation needed|reason=What are median license fees and litigation costs? Consider also the lower cost of ex parte and inter partes reexam.|date=November 2008}}