That is actually almost the same situation as the U.S. The difference is that there is at least one court case showing that U.S. judges can be mistaken about the patent-worthiness of software, business process, or mathematical equations. It just takes a single judgement to leave that question open, and then the patent lawyer sharks will go for all the money they can squeeze out of the broken system. That’s exactly what has already happened in the U.S., and all your statement shows is that the EU is just a time-bomb that hasn’t gone off yet.

“and India has rejected software patents, a wide relatively patent-free space exists, that limits the effects of patents including in the US”

Ooh, I expect to make so much money selling my software only in India now. Don’t get me wrong, I think India is showing what the world’s largest Democracy should look like. Get real, do you really think a U.S. patent holder cares at all, about whether they can exploit money from companies that ONLY do business in India? U.S. software patent policy stifles innovation in ANY company that does ANY business in the U.S.

“(except for local litigation and its costs)”

Does this really deserve just a parenthetical? Those “costs” are estimated at $11.4 billion annually! That does not even include the basic external costs of litigation, like engineer time lost to a witness stand. Estimated total costs are $30.4 billion annually, according to a recent study by the ESP project. You managed to encapsulate the white elephant of software patents into a single parenthetical. Bravo!

http://biz.yahoo.com/prnews/080228/aqth077.html?.v=35
http://endsoftpatents.org/home-page

That makes software patent litigation in the U.S. its own multi-billion dollar industry — an industry that constantly litigates over innovation, and never CREATES novel innovation.
And guess who directly benefits from all this expenditure on patent litigation? The same lawyers that end up inside the part of the judicial system that rules on patent law. That’s what I would call a self-perpetuating system.
All that money could instead be invested on real software innovation, rather than going through the onerous and expensive process of overturning obvious and prior-art infested patents.

Here’s some news for you: just because writing can be PROCESSED by a machine, that doesn’t make the writing itself a machine. The machine is what makes the processing possible, not the written language that it interprets. Have you ever gotten a piece of paper to interpret Lisp, and complete calculations for you? If you have, I feel I must tell you, you are both mistaken and a mathematical genius — it was your brain doing the processing, not the piece of paper. Are you going to patent your brain? I wish you luck on patenting your Spanish-English dictionary.

Writing, in all forms, comes under either Copyright or Trade Secret protection (and those forms of protection are mutually exclusive). In limited forms, writing and art can also come under Trademark protection. Giving any form of writing, sensory art, business process, or mathematical formulas patent protection is just plainly ridiculous. Any such claim should be laughed out of the PTO, or at least out of court. The fact that it hasn’t, to date, just means that both the PTO and court are either biased, or just negligent.

- The first one is the assumption that software patent thickets would block innovation itself. Software innovation arise from individuals and small groups, be them sometimes working for large companies. They generally work in complete ignorance of software patents. Even more, many of the software patents actually regard innovation … that was conducted much before they were filed. It is clear that these software patents are unlikely to block innovation that already proceeded. However things are very different at later stages of innovation dissemination. The example of standards shows in my opinion that patent thickets do exist, in particular in telecommunication and media related standards, and that they do block, slow down or raise the cost the dissemination of innovation. Examples : domain name internationalization (blockage, also explained by reasons that are not related to patents), JPEG 2000 (temporary blockage), MPEG-4 (raising the cost).

- The second myopia is that any adverse effect of patents is likely to fully materialize only when patents are generalized to all geographical regions of the world where innovation is conducted. Pharmaceutical patents generated an innovation or access to innovation crisis only from the 1970s when they were generalized to all developed countries. For software patents, as Europe is in a mixed situation (software patents are not legally recognized but are granted by the European Patent Office, with almost no litigation proceeding) and India has rejected software patents, a wide relatively patent-free space exists, that limits the effects of patents including in the US (except for local litigation and its costs).