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Microsoft says will demand royalties from FOSS developers and users; no one seems overly worried

May 15, 2007

According to a publication in Fortune, Microsoft has reportedly patented 235 technologies, which have been used for years without permission in many open source projects, including Linux. Microsoft is now pondering whether to demand royalties not only from vendors and developers, but also from end-users.

Given the wide-spread adoption of open source, it is only logical that the news spread  quickly and became the subject of numerous online debates and follow-up publications. However, it seems that for now no one is taking Microsoft's threat too seriously, for a number of reasons.

For one, the original Fortune article itself reminds the readers that a consortium of six big IT companies (IBM, Sony, Philips, Novell, Red Hat and NEC) was created back in 2005, in order to counter exactly such threats to FOSS by pooling resources to establish a big patent hoard. The key patents there are relevant to most of today's software. This intellectual property cache was not created to defend pure ideals and private hobbysts: the livelihood of those companies depends on open source software, and they plan to protect their profits. Any company that challenges intellectual property in key open source projects, including Microsoft, will find itself facing a counter-challenge for patents used in its own software.

It is important to note that copyleft licenses like Richard Stallman's GPL have held in court. There are precedents: if a company takes an open source, GPL-licensed technology and then sells it as a closed source product, it is in breach of copyright law.

Aside from a possible patent violation suite of their own, the aforementioned "defender" companies, together with others like Oracle, are likely to come up with a significant amount of expensive legal firepower. Thus, if Microsoft decides to go to court with its claim, it will meet there an army of lawyers, and some of these will be provided by IBM. IBM's continuing struggle with SCO's patent claim of 2003 has honed the skills of its attorney regiment to the point where they are lovingly called "the Nazgul:" the merciless, ever-vigilant, fiercely loyal, clad in black servants of the One Ring; the end line being you don't really want to mess with these guys.

The IBM vs. SCO case is vaguely reminiscent of the current situation. At one point, SCO was demanding $5 billion of IBM claiming that Big Blue was had, without authorization, contributed SCO's intellectual property to the codebase of the Linux operating system. The suit is ongoing, but it has not done SCO any good, in effect critically devaluing its stock price.

In fact, a premier expert on the particular IBM vs. SCO case and intellectual property in general, Groklaw.net, has published a list of reasons why Microsoft cannot press on with its claim to royalties. They make the clever argument that if Microsoft goes after open source software, they will have to sue their own customers, which in the majority of cases use Linux in parallel with Microsoft products. Also, Microsoft will have to sue the Pentagon, the NSA, and other government organizations that use FOSS. Other relevant topics in the article include prior art for those patents and the current trends in court decisions regarding open source.

In conclusion, it seems that Microsoft is basically doing a publicity stunt. Potential customers, who are not knowledgeable about open source, will remember Microsoft's threat when they plan software purchases: such is the effect of media. Smaller companies may choose to ally themselves with Microsoft, the way Novell did. But in the end, there will be neither major changes in the open source business ecosystem, nor significant threats to the open source enthusiasts at home.

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