Is the Microsoft-Novell deal dead on arrival?

November 15, 2006, 6:23 PM UTC
Fortune

The potentially historic Microsoft-Novell pact announced last week, whereby Microsoft would grant patent peace to users of Novell’s Suse Linux software in exchange for royalty payments paid by Novell to Microsoft, will be dead by mid-March, promises Eben Moglen, the general counsel of the Free Software Foundation (FSF). The FSF controls the license that governs the distribution of Linux and many other key forms of free and open-source software.

The license, known as the GNU General Public License (GPL), had already been in the process of revision. In an interview with me this morning, Moglen promised that the foundation will now make “further changes” to the GPL that will make crystal clear that the Novell-Microsoft pact, or any similar pact, will violate it.

“It will surely violate GPL version 3,” said Moglen, referring to the forthcoming version. Version 3 had been expected to be in place no later than March 15, 2007, though Moglen said he was uncertain whether the new circumstances would affect that schedule. “GPL version 3 will be adjusted so the effect of the current deal is that Microsoft will by giving away access to the very patents Microsoft is trying to assert.”

At 9:13 a.m. (Eastern Time) Legal Pad emailed Novell (NOVL) and Microsoft (MSFT) seeking comment. Microsoft referred the inquiry to Novell. At 3:45 p.m. Novell’s chief marketing officer, John Dragoon, sent back a statement. It’s printed below this post in its entirety.

Though the Novell-Microsoft deal also included components that called for technological and marketing cooperation between the companies, the FSF objects to only one of the legal components of the deal. That is the provision that would grant patent peace to those users of Linux who sign service and support agreements with Novell, but not to other users of Linux. By granting patent peace to Novell’s Linux users, the pact was seen by many in the Linux community as implicitly menacing all other Linux users, by heightening the threat that Microsoft might sue them.

Moglen offered no opinion on whether the Microsoft-Novell deal violates the GPL currently in effect (known as version 2), but merely pledged that version 3 would clearly bar such “discriminatory” deals. Moglen also heads the Software Freedom Law Center, whose clients include such free and open-source projects as Samba and Wine.

“I’m instructed by my client,” Moglen said, referring to the FSF, “that version 3 will contain measures that will prevent any such deal from occurring in the future. We will change the law such that . . . we will reverse the legal consequences of this deal.”

The Microsoft-Novell pact had been welcomed by the chief technology officers of many Fortune 500 companies, who just want to be able to use free and proprietary software, to have them interoperate smoothly, and to not have to worry about incurring patent suits. Nevertheless, the free and open-source developer community–which produces such software–has generally received the deal with great suspicion and trepidation, if not outrage.

Regular readers of this blog may wonder if the deal Moglen is effectively declaring to be dead on arrival is the same one that I described just five days ago (in the previous post) as “potentially paradigm shifting.” The answer is: well, yes. But Friday was a more naive and hopeful era.

NOVELL’S STATEMENT:

Novell remains committed to its historic agreement with Microsoft regarding Linux and Windows interoperability. This agreement was in direct response to the hundreds of thousands of customers who use both Linux and Windows who simply wanted both operating systems to work well together. Mr Parloff suggests he has discovered similar support from enterprise clients who “just want to be able to use free and proprietary software, to have them interoperate smoothly…”

Our second objective remains the growth of Linux and Open Source. By addressing issues of interoperability, we advantage Linux in the marketplace and in doing so make it a more compelling alternative to UNIX and other operating systems (yes, even including Windows). While Microsoft may believe they are advantaging Windows, we believe in the power of the open source community. In any case, it’s called competition and the ultimate winner is the customer. The technical and business collaboration elements of the Novell and Microsoft agreement are the most compelling and valuable agreements from the customer perspective and they will serve to promote open source.

We dealt with the current GPL license (GPL version 2) when we worked on our partnership with Microsoft. We reaffirm that our patent cooperation agreement is compliant with GPLv2. The fact that Mr. Moglen offered no opinion on this question is instructive. As to GPLv3, which is still a work in progress, Novell has supported the Free Software Foundation’s pursuit of transparent discussions that surface and address the needs of all relevant constituencies — customers, developers and vendors. For GPLv3 to be viable and relevant, it will need to address the needs of these constituencies, and Novell maintains that its partnership with Microsoft benefits those constituencies. The GPLv3 efforts should not be turned to a task designed to undo a transaction that will actually promote the enterprise-wide adoption of Linux and one that will best address the computing needs of customers.

Novell has entered into a transaction with Microsoft that will address a real customer issue: getting heterogeneous IT environments to function better. Novell has been a leader in the open source community; one who has made important technical contributions and one who has been on the forefront of providing legal protection (through indemnification for our customers, our patent pledge, and our co-founding of the Open Invention Network alongside IBM, Sony, Philips, and Red Hat). Novell has contributed more than 10 million lines of code to Linux and the open source community, and we support more than 250 engineers whose full-time job is to develop open source software.

There are various opinions about the Novell-Microsoft agreement. We continue to believe that by focusing on the needs of the market and the long-term growth of Linux, the agreement will generate the results that Mr. Parloff thought possible last week when he was imagining a more “hopeful era.” Our customers hope so, too.

John Dragoon
Senior Vice President – Chief Marketing Officer
Novell