Microsoft-Novell deal reminiscent of SCO saga

The intellectual property implications are ugly, says Tom Yager

When I have to declare, as I do this week, that everything I write in my column and blogs is my personal opinion, you know I’m on the warpath.

Among huge companies, closely-held backroom deals are the norm. Putting aside fear of litigation, Novell and Microsoft made such a deal and went public with it. They set up open source players, although consumers of open source never quite got past their fear of abandonment. The message is this: if you’re running Linux, but you’re not running Microsoft-blessed SLES (Suse Linux Enterprise Server), Microsoft won’t promise not to sue the maker of your Linux distribution, one or more of the open source projects that are part of it, or you. BSD and OS X, and their users, don’t get a pass, either.

The shape of this agreement suggests that Microsoft and Novell have learned from the best, the corporate strategic masterminds at the SCO Group. The scheme there, which you may recall Microsoft championed early and loudly, was to declare that Linux incorporated source code protected by SCO Group copyrights. This declaration gave SCO the power to send out threatening letters to software vendors and customers. The letters said, in essence, that the lucky recipient could pay SCO a licence fee now, or risk having its name added to the big list of defendants in its case and pay far more.

SCO Group’s intentions were variously interpreted. The shallow take on it was that SCO wanted to turn the open source market into its personal piggybank. A deeper, gloomier take was that SCO Group wanted to wipe out Linux and Unix products that weren’t explicitly blessed by it as the owner of the System V Unix intellectual property portfolio. Fortunately for all of us, SCO Group got tangled up in IBM’s legal net. Have you thanked them lately?

But back to the SCO Group Academy’s newest and proudest graduates, Microsoft and Novell. To celebrate the pairing, Microsoft is giving away 70,000 coupons for SLES to customers who want to run Windows and Linux together. These are “stay out of court free” cards that hope to derail customers’ existing relationships with other commercial Linux vendors. It’s a quick rise to prominence for Novell while its competitors run for cover.

Microsoft has far more IP to bring to the table than SCO did. Just off the top of my head, I can imagine Microsoft defending its IP on the FAT and FAT32 file systems (which already require licences in more visible uses), the NTFS file system, the Remote Desktop Protocol used by Terminal Server, non-LDAP technology used in Active Directory, Windows Media file formats and digital rights management, .Net, and, of course, Windows file/print sharing.

Potential enforcement of tangible IP is the most talked-about risk, but I see the greatest threat being CALs (Client Access Licences). To me, the greatest risk is that Microsoft will assert that all non-Windows systems connected to Windows servers are subject to CALs. Microsoft will cut a deal with Novell to allow Novell to bundle and resell Windows CALs.

The market has been down this road before. AT&T tried to wipe out its biggest threat at the time, BSD Unix, by charging that it incorporated System V. Berkeley effectively won that argument, cleaning all of the System V-ness out of its OS.

There is plenty of cause now for marking Microsoft IP, and anything that a judge might mistake for it, for cleaning out of OS X and Linux. Interoperability is, after all, a two-way street.

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