When Computers Create Code, Who Owns It Is a Question Worth Billions
NEW YORK—Google’s DeepDream has generated artwork; the What-If Machine created the characters and story for a West End Musical; music composed by programs was performed in the London Symphony in 2012. We talk about jobs that may be lost to automation, but there is scant attention paid to who owns the intellectual property created by machines.
Artificial intelligence technology no longer allows us the luxury to vacillate. With the advent of AI, software and computers will be creating a number of programs and original works.
But in many parts of the world, IP laws have not kept pace with the technology. US copyright and patent statutes for instance traditionally required humans as authors or inventors in order for works to be protected under copyright or patent law.
Part of the problem may be historical—copyright laws for instance, were crafted to address printing press technology (that enabled human beings to copy at little to no cost) and not artificial intelligence and the ability for software programs to generate more programs.
The latter point has a real world impact—if the IP for programs generated from code belongs to the code, it could impact the Indian IT industry, and cost millions their jobs.
Other countries such as the UK and the European Union on the other hand have modified their laws, or are considering proposals to do so in order to address the advances, and breakthroughs in robotics technology. The UK for instance, has done away with the requirement of the human author and is conceivably open to awarding copyright protection to bots created by bots.
The UK, when introducing software programs into the Copyright, Designs and Patents Act in 1988 specifically did away with the requirement of “human author” (when recognizing which works would be eligible for copyright).
In 2017, the Committee on Legal Affairs of the European Parliament released a study on AI and asked for the elaboration of criteria for “own intellectual” creation for copyrightable works produced by computers or robots; thus, paving the way for copyright protection for AI.
Who owns the AI?
The problem of who will be the “owner” of the programs created by programs poses a thorny issue. Some folks point to programs such as Google’s DeepDream art, and argue that the program was a “tool” or paintbrush that enabled human authors’ vision to be manifested and so, the human author would own the IP. Others argue that the programmer who wrote the software or algorithm should be the author and copyright owner.
The law thus far has been silent on who owns the IP when the machine output cannot be predicted by the humans involved. There is a third group which includes technology savants like Elon Musk, who argue that AI created work should be in the public domain, owned by no one.
Will contracts supersede the law?
While we wait for the laws in connection with IP ownership of AI to be developed or crafted, people may (by contract) have unwittingly given up that right. Right now, most employment contracts include a “work for hire” concept. As a result, most employers that use software programmers, writers etc. as employees or contractors include a wide provision that states all work produced during the term of employment or contract will be owned by the employer. The salary or fees paid to create the work is considered adequate compensation, including to transfer ownership in IP rights.
On the face of it, the above may not seem worrisome or particularly important. However, it becomes significant because of the additional complication presented by the following contracting practice.
Why should India’s technology industry worry
As a corollary to the above ‘work for hire’ employment contracts, large corporate customers particularly US clients have consistently insisted that all Indian technology corporations providing services to the US corporation transfer all the IP produced during the provision of, and in connection with the services. Indian technology corporations by and large have not objected to this.
Indeed for decades Indian technology corporations have transferred all IP to the client, believing the secret-sauce was the know-how or knowledge of how to implement the software programs. Hence, by inserting locks or restricting US clients from hiring their software programmers, Indian technology industry was content.
This is about to change. Once copyright protection is recognized for AI code, no one else will be allowed to copy that code for a long time (the life of the author + 50 or 70 years depending upon the jurisdiction). Similarly, if a patent is granted for a code, no one else will be allowed to use that code for a long time (20+ years from the date of patent application).
Hence, if AI is granted formal IP protection, and the US clients own all the formal IP, they could take advantage of the protection offered by copyright and patent laws and be able to prevent Indian companies from performing the same services for other clients or corporations. In other words, if the Indian companies used the same code for other clients they could be sued for copyright or patent infringement. Especially so, because the U.S. has been comfortable recognizing patents for algorithms in connection with AI.
Steps now needed
To continue to ride the technology wave in the AI era, Indian industry will have to adapt quickly and dramatically modify its contracting and negotiating practice. Companies must negotiate hard to retain the formal IP in order to be able to continue to operate their service lines in future. Hence, the risk presented by AI will not only be the loss of US and EU jobs as a result of computerization – estimated by Oxford University’s study as 47% and 54% of the US and EU workers’ jobs and the trickle-down effect on India but also from being able to write programs or perform work for other corporations as a result of AI IP they have written and handed over to their clients.
It is an existential moment for the industry. At risk is not only half the 3.9 million Indians’ jobs or 70% of the Indian IT workforce (as a result of automation) but the $155 billion industry that has been the engine for India’s economy and global image. It is not all dark – if Indian firms were to change strategy and to negotiate to own the IP they create, India may well succeed in riding the technology 2.0 or AI wave and epitomize the latter part of Hawking’s prediction:
“Whereas the short-term impact of AI depends on who controls it, the long-term impact depends on whether it can be controlled at all.” – Stephen Hawking
Aarthi Anand is a leading technology attorney, Vice President at J.P. Morgan, New York, and was a Rhodes Scholar. The views expressed here are those of the author and do not reflect the opinion of the Bank.