That's why large software companies are patent mills. On any given Tuesday, both Microsoft and IBM are probably issued a dozen patents. These patents aren't used as much to protect their innovation as they are to ward off patent trolls -- first with patents that may contradict what the trolls have, and second with a mountain of IP that will be used as cross-licensing fodder during the settlement negotiations.

Avoiding the Hash Problem in the First Place

So what was the problem, anyway? Your team developed the hash algorithm on their own. Sure, but that doesn't matter: you don't have to copy IP to infringe on a patent. All you have to do is use the same "novel method" that is protected by somebody's patent. Even though you have the ultimate "clean room" implementation -- you don't even know about the patent you're infringing -- the rent will come due if the patent holder finds out about it. And of course, it's not just hash calculations: lots of ideas and methods are patentable.

With software you're writing entirely for internal use, there's not much risk of somebody external discovering at infringement. But in the cloud, the whole point is to allow your web services to be used by others. You build an API based on a hash algorithm, and then you publish it to the world. Now the trolls can find you. And the more external parties use your clever little hash algorithm, the larger the royalties and damages can become. Lovely.

Of course, hash algorithms and protocols and business process automation mechanisms are commonplace in advanced business software. It's not like you can stop using them just because you're doing work in the cloud. But what you can do is buy, rather than build, these externally-visible components. When you buy them, though, the whole point is to get indemnification from IP infringement. Grabbing something from Sourceforge won't cut it -- there's no indemnification unless you've got a contract with a vendor who will stand behind it.