In 1974, the Commission on New Technological Uses of Copyrighted Works (CONTU) was established. CONTU decided that "computer programs, to the extent that they embody an author's original creation, are proper subject matter of copyright."
[16][15] In 1980, the United States Congress added the definition of "computer program" to
17 U.S.C. § 101 and amended
17 U.S.C. § 117 to allow the owner of the program to make another copy or adaptation for use on a computer.
[17]
This legislation, plus court decisions such as
Apple v. Franklin in 1983 clarified that the Copyright Act gave computer programs the copyright status of literary works. Many companies began to claim that they "licensed" but did not sell their products, in order to avoid the transfer of rights to the end-user via the
doctrine of first sale (see
Step-Saver Data Systems, Inc. v. Wyse Technology). These
software license agreements are often labeled as end-user license agreements (EULAs). Another impact of the decision was the rise of the
shrink-wrap closed source business model, where before a
source code driven software distribution schema dominated.
[18][19]
In 1998, The United States Congress passed the
Digital Millennium Copyright Act (DMCA) which criminalizes evasion of copy protection (
with certain exceptions), destruction or mismanagement of copyright management information, but includes a clause to exempt ISPs from liability of infringement if one of their subscribers infringes. In addition, the DMCA extends protection to those who copy a program for maintenance, repair or backup as long as these copies are "destroyed in the event that continued possession of the computer program should cease to be rightful."
17 U.S.C. § 117
