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I set up a company and had a software developer create a new software program for the company. I thought that the idea for the software was novel, and before developing the software, I did some research and didn't see that any similar programs existed. I had the software copyrighted and am preparing to start offering it for sale.

Upon further research, I now see that there is a competing software program offered by another company. The programs are very different. My program was developed completely without reference to the other program; I had no idea that it existed when mine was developed and copyrighted, and IP counsel and others I talked to said not to worry.

I'm very risk-averse, and would actually be happy if the other company and I could work together, since each of our programs does things that the other doesn't, and we could have a great product together. (I also know that a bully who's aware of my program could threaten legal action just to drive me out of the marketplace; even though I am confident that I'm fine, legally, I don't want to deal with a groundless lawsuit.)

Good idea to approach the other company before starting to sell my program (such as to propose a joint venture or to offer to work out a way for each of us to stay within a market niche)? Or better to just start selling it and let the other company contact me? Thank you.

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I would not approach them just yet. They may be so committed to their product, or so emotionally attached where they may not seem the value of your product. Plus, you may put yourself in a better partnership position if you are first Rivals.

Continue the course. Having competition is beyond healthy, it gives you a bar to measure up against, it allows you to challenge yourself to further innovate and builds a sense of competition. The smart thing to do is not to bad mouth your competition. Treat them with respect. Leave the door for working together open, (DONT BURN THAT BRIDGE). You may find in the future that your product is so superior that you can actually be the big player in the arena. Just because you are the new kid on the block doesnt mean that your product is not better. Also, keep in mind that you can borrow ideas from your competitor to make your product even stronger and more robust.

Keep forging ahead. A meeting before you are successful would make you seem weak, timid, and give them a political advantage that may not be in your interest in the future. As things progress, and you have a solid company then try to communicate with key players at your competitor to setup alliances where your products can work together.

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Thanks- very valuable answer, which I really appreciate. – user6492 Jan 11 '11 at 3:11
To add: I'm new at the software business and my knowledge of intellectual property is limited. Even though I have been as cautious as possible in developing my program and wasn't even aware of other programs when I developed mine, I'm skittish about an existing company finding out about my program and sending a lawyer after me, claiming IP infringement; I'm self-funding my company and would hate to lose my hard-earned money due to a bully and frivolous litigation. Any way to play it safe and pre-empt that, other than approaching a competitor and establishing a good relationship? Thanks. – user6492 Jan 11 '11 at 3:20
its good that you are cautious but i wouldnt worry about it too much. I recently read somewhere that one company was suing apple, facebook and others because they infringed on existing ip and patents. The bottom line is you do your due diligence, but dont let it hold you back. The worst case is that you strike it rich and its something for attorneys to handle later. Those are what i categorize as good problems :) . Keep forging ahead, and dont spend too much time worrying about suits. The bottom line is that if you are in business you will eventually get sued. – Frank Jan 11 '11 at 5:34
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I think you're worrying over nothing, theres no reason that you cannot immitate a software package that is already out there. So long as its your own work (i.e. you don't have a copy of the other companys' source code etc). After all, how many Virus scanners are there? Web browsers? File compressors etc etc?

As the other guy mentioned, competition is healthly. It'll encourage you to improve your software and your competitor to improve theirs.

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