Man you can still get by with Photoshop CS3 as far as features go.
You are wildly off base. The algorithms aren't difficult or special. They were written by people reading text books for the most part.
They are able to sit on an on old algorithm for decades because the DMCA made interoperability and selling cheaper tools like that basically illegal.
Because of the DMCA, the work that was done to make IBM PC clones would have been close enough to illegal to kill all the businesses that tried it. They still tried with the liberal IP laws at the time.