Understanding Software

What is Software?

The New Oxford Dictionary for the Business World defines ‘software’ as programs used with a computer (together with their documentation), including program listings, program libraries, and user and programming manuals.

Definitions in India

In India, the term ‘software’ has been defined under the Income Tax Act, 1961 and under the Copyright Act, 1957. Explanation (b) to Section 80 HHE of  the Income Tax Act, 1961 defines “computer software” to mean any computer programme recorded on any disc, tape, perforated media or other information  storage device and includes any such programme or any customised electronic data which is transmitted from India to a place outside India by any means.

Under the Indian Copyright Act, 1957, computer programme and computer data bases are considered to be literary works. Section 2(ffc) defines “computer  programme” as a set of instructions expressed in words, codes, schemes or any other form, including a machine readable medium, capable of causing a  computer to perform a particular task or achieve a particular result.

In India, computer software is protected by the copyright law but cannot be patented. In many developed countries of the world, computer programs are protected by the copyright law and certain types of software are protected by patents as well.

As per the Copyright Act, 1957, ‘computer programme’ is regarded as literary work. Some of the statutory rights attached with a copyright in a computer program are:

• Right to make copies of the computer programs based upon the copyrighted computer program in any material form including the storing of it in any medium by electronic means,  ­

• Right to issue copies of the computer program to the public ·
• Right to make translation of the computer program ­
• Right to prepare derivative computer programs based upon the copyrighted  computer program, ­
• Right to make a public performance of the computer program, and ­
• Right to sell or give on hire, or offer for sale or hire, any copy of the computer program.

 Types of Software

In technical sense, there are two types of software - Systems Software and Applications Software.

“Systems software” is the software required to produce a computer system acceptable to the end-users, providing a good environment for writing, testing, running and storing users’ programs, and including programs that are essential to the effective use of system. Operating systems, compilers, utility programs, database management systems, and communication systems are examples of systems software. Systems software is generally provided by the manufacturer and is bought along with the computer.

“Applications software” are computer programs designed for a particular purpose

or application. Accounts programs, games programs and educational software are application software. Application software is written for end-users of a computer system. Application software may be standard software or special software which is tailor-made for single users.

There are some more terms which are commonly used to describe the different Modes of delivery of software. These are as follows:

“Shrink-wrap software” is the readily available software which is sold ‘off-the-shelf’. Against this, “customized software° is the software which is tailor-made based on the specific needs of the customer. In a ‘shrink-wrap’, the software is packaged with the license agreement. The Iicense gives the endorser the limited right to use the software for perpetual period. The right is not transferable and nor can the buyer sub-Iicense the software. Any user opening the package is deemed to have the knowledge of the copyright of the software.

“Bundled software” is one which is embedded with the hardware and is bought along with the computer when it is purchased from the manufacturer. Most of the systems software generally comes in the bundled form. Most of the applications software will be available in “unbundled” form especially if it is bought subsequent to the purchase of computer.

“Canned Software” is independent software that can be used by a variety of hardware and may be applied for management, consulting and administration.

Software are also often classified on the basis of the use to that they are out to.

Thus, the classifications may be as follows: Computer software, Video/audio Software, Telecom Software. Generally, the word ’software’ is read to mean’ computer software’.

Typical Transactions involving Software

Any transaction in transfer of computer software would generally tend to fall in

any one of the following categories :

1. Transfer of a copy of the computer program (a copyrighted article),

2. Transfer of a copyright right in the computer program,

3. Provision of services for the development or modification of the computer

Program;

4. Provision of know-how related to computer programming techniques.