Legal Definitions - algorithm

Algorithm

An algorithm is a precise set of instructions, rules, or a computational procedure designed to solve a specific problem or perform a particular task. It takes an input, processes it through a series of defined steps, and produces an output. While often associated with computers and software, algorithms are essentially logical blueprints for problem-solving that guide how data is processed, decisions are made, or patterns are recognized.

Legally, the abstract mathematical or logical idea behind an algorithm itself was historically considered unpatentable because it was seen as a fundamental concept rather than an invention. However, if an algorithm is practically applied in a way that produces a useful, concrete, and tangible result—such as when it is embedded within a piece of software that performs a specific function—it can be eligible for patent protection.

Here are some examples of algorithms in action:

• Online Search Engine Ranking: When you type a query into a search engine, an algorithm processes your request. It analyzes countless factors, such as the relevance of keywords, the authority of websites, the freshness of content, and your past search history, to determine which web pages are most likely to answer your question. It then ranks these pages and presents them to you in a specific order.

  This illustrates an algorithm because it's a complex set of rules and calculations that takes your search query (input) and transforms it into an ordered list of relevant websites (output) by solving the problem of finding the most pertinent information.

• Automated Stock Trading: Financial institutions use algorithms to execute trades on stock markets. These algorithms are programmed to monitor market conditions—such as price fluctuations, trading volumes, and news events—and automatically buy or sell stocks when specific predefined criteria are met. This allows for trades to occur at speeds and volumes impossible for human traders.

  This demonstrates an algorithm as a set of rules that takes real-time market data (input), applies a series of decision-making steps based on programmed criteria, and then executes specific buy or sell orders (output) to achieve a trading objective.

• Personalized Social Media Feeds: Social media platforms use algorithms to curate the content you see in your news feed. These algorithms consider factors like your past interactions (what you've liked, commented on, or shared), the accounts you follow, the recency of posts, and the popularity of content among your connections. Based on this analysis, they decide which posts to display and in what order, aiming to keep you engaged.

  This is an example of an algorithm because it's a sophisticated procedure that takes your user data and network activity (input), applies a set of rules to prioritize and filter content, and then presents a personalized stream of posts (output) to solve the problem of delivering relevant and engaging content.