Have a look at the XINE project page
http://xinehq.de/index.php/patents

The third paragraph contains the gist of what are the implications of software patents for the free software community. I am quoting it below for quick reference:

</QUOTE>
How does this affect the xine project?

The xine library contains a lot of algorithms related to video and audio decoding which have been derived by clever people through methods of reverse engineering. While this is to the best of our knowledge currently legal in the EU, it will become severe patent infringement once the big companies decide that the community's work now belongs to them. A good number of xine team members live in EU territory so this could dramatically hinder xine development.
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