This is speculation, but I think it might work. The first reason
is a provision of the Companies Act that says any assets of a
dissolved company will be bona vacantia – meaning they
belong to the Crown. A liquidator can value and sell everything
from a company's furniture to its computers with relative ease; but
intellectual property is harder to identify and much harder to
value. These intangibles include the copyright in software and, if
unsold, they become the property of the Crown. The Crown cannot
advertise everything it acquires in this way because it simply does
not know what it owns. Given the youth of the software market, the
70-year duration of copyright in software and the large number of
software companies that have fallen over the years, it is
reasonable to assume that the Crown owns a lot of rights.
The other reason this could work is that software will often be
preserved in escrow. Buyers of business-critical software
frequently demand that developers deposit a copy of the source code
with a third party, known as an escrow agent. This source code is
the formula that lets a new developer adapt and improve an original
work. It is held by the escrow agent until a trigger event, such as
the developer going out of business, described in a contract. I
know of at least one escrow company that has been building a
massive archive of source code since the early 1980s.
Escrow agents typically release source code only if a party to
the agreement notifies them of a trigger event. That can mean them
holding the code indefinitely. Discs and manuals take up little
space. And while the escrow agent charges for retention, I'm told
by an agent that the materials are unlikely to go in the bin in the
event of non-payment, given the risk compared with the low cost of
continued retention.
Now, if a developer has gone out of business, a working copy of
its software is unlikely to be much use if someone wants to work
with the source code to make updates. That is why escrow agreements
often demand a lot of supporting material, right down to the phone
numbers of key engineers. This is great news for an
entrepreneur.
The biggest challenge is the treasure hunt: finding a piece of
software from a defunct developer that is ripe for exploitation. If
such a gem is identified, an entrepreneur can reveal his finding to
the Treasury Solicitor and negotiate a price. The buyer will want
to make payment contingent upon getting the source code – and
escrow agencies are a good place to search. Once you hold the
rights in the code, they'll surely release to you as the new
copyright owner, though they'll be justified in seeking unpaid
storage arrears.
I don't know if anyone has tried this – it just strikes me as an
interesting idea. Can you get rich selling someone else's software
after they tried and failed? Maybe. Back in 1981, all rights in an
under-exploited piece of software called QDOS were bought for
$50,000 by a start-up called Microsoft. Some tweaking and a
re-brand produced MS-DOS. Further work and another re-brand and the
Windows operating system was born. It didn't do too badly.
By Struan Robertson, Editor of OUT-LAW. This opinion piece
first appeared in Struan's regular column for Times
Online.
