IBM to Free 500 Patents

U.S. patent leader IBM Corp. plans to donate 500 patents for free use by software developers, marking a shift in intellectual property strategy for the world’s top computer maker and a challenge to the high-tech industry.

Jim Stallings, IBM’s vice president in charge of intellectual property, said Tuesday that the move was meant to encourage other companies to unlock patent portfolios to spur technological innovation.

As the leading provider of computer services, IBM also stands to benefit from helping other companies make use of new technology developed under the open licensing program.

The 500 patents cover areas such as storage management, simultaneous multiprocessing, image processing, database management and e-commerce.

IBM, which over the last decade has stood out as a leader among companies seeking to reap greater profit from its patent portfolio, will continue to receive royalties from thousands of patents it holds on chips, supercomputers and other products.

The donation coincides with an announcement by the U.S. Patent and Trademark Office that IBM topped the list of annual patent recipients for the 12th straight year in 2004, with 3,248 patents -- 1,314 more than No. 2-ranked Matsushita Electric Industrial Co. of Japan.

IBM’s policy change puts it at the vanguard of a movement to redefine patent laws in less restrictive ways.

But Florian Mueller, campaign manager of a group lobbying to prevent software patents from becoming legal in the European Union, dismissed IBM’s move as insubstantial.

“In Europe, IBM is a driving force behind the extension of the scope of patentability with respect to software,” Mueller wrote on NoSoftwarePatents.com’s website.

IBM was not available for comment on Mueller’s remarks.

Shares of Armonk-N.Y.-based IBM fell 68 cents to $95 on the New York Stock Exchange.