Cambridge's plan to take ownership of most campus-generated intellectual property will do untold damage, writes Ross Anderson.

Insurrection is brewing at Cambridge University over proposals to take ownership of almost all intellectual property generated by its faculty. From 2003, patents, copyrights and trade secrets will be controlled by university bureaucrats rather than us. Behind the change lurks the Department of Trade and Industry.

Staff will be affected in different ways. In my case, I expect to have difficulty releasing software into the public domain and maintaining software I've already released. This is because Bill Gates, our largest individual benefactor, apparently hates free software. After all, tax money collected from Microsoft is paid to academics who write software and give it away, often in competition with Microsoft. So long as I own the code I create, I can happily ignore his viewpoint. But once the copyright to all software written in the university is controlled by the university, the situation will change.

The effect will not be limited to computer scientists, physicists, economists and others who use software to communicate their work. The university proposes to take ownership of material such as lectures that it has commissioned. Next time I write a book based on lecture notes, they could ask for a share of the royalties.

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But the heart of the matter is patent rights. Cambridge (like Massachusetts Institute of Technology and Stanford University) allows faculty members to keep the patent rights to ideas, except where specific grant funding or commercial contracts impose other conditions. This liberal regime has been critical in spinning off large numbers of high-tech companies. Study after study has shown a positive correlation between faculty incentives and success at technology transfer.

But if the DTI gets its way, Cambridge will change at a stroke from having one of the most liberal IP regimes in the UK to one of the most strict. The new rules will treat all our ideas as if they had arisen in the course of a government-funded project, and will extend control from patent to copyright too. Moral rights are at issue as well as money. Many academics want a veto on who our inventions or software get licensed to: this is not on offer to us.

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The proposal is anchored in the government's recent science strategy, Investing in Innovation . The government argues that as many English universities get most of their income from the Higher Education Funding Council for England, every university should own the research done on its campus.

There are significant consequences for industry as well as for academic freedom. Patricia Hewitt's predecessor at the DTI, Tony Benn, destroyed Britain's computer industry by nationalising it and consolidating it into ICL. Now she seems on course to destroy the "Cambridge Phenomenon". Just as ICL staggered on for years and still exists after a fashion, so the cluster of computing and biotech companies around Cambridge will still sort-of exist in 20 years. But something magical and vital will have gone. Cambridge will no longer attract or retain leading scientists who are passionate about turning their research to practical use.

What is to be done? There is a good chance that we can defeat the measure when it comes to be endorsed by the Regent House, Cambridge's legislative body. We plan to amend it so as not only to reject the "Great IP Robbery" but to roll back the bureaucrats. We will introduce internal competition into technology transfer.

Most Cambridge academics belong to a college and a department as well as to the university, and most would prefer the institutional share of externally funded research income to go to one or the other rather than to the bureaucrats. Some colleges are already active at technology transfer: Trinity and Johns have world-famous science parks. Some departments are active too. The seeds for a more diverse and effective regime are already sprouting. Empowering the colleges will also provide a useful counterweight to an overweening centre.

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We therefore propose that everyone should have a choice. Every academic (postdoctorate and student) who has an idea that must be institutionally held as a condition of grant funding, should be able to do a deal with the university, or a department, or a college, as they see fit. The government claims to believe in the theory of contestable markets, so it will be interesting to see if it has the gall to object.

Ross Anderson is reader in security engineering at Cambridge University.