As Shane pointed out, where things stand at the moment, GPLv3 does indeed address the Microsoft/Novell deal. InformationWeek confirms this as well:
The final draft of GPLv3 states that companies that distribute open-source software cannot at the same time pursue patent claims against users of that software.
Mind you, this is “last call” draft. You may also wish to have a look at my most recent comment because Reuters is apparently making stuff up (again!).
Also, finally available to non-subscribers is a summary of the Novell/Microsoft session at OSBC (from
lwn.net). You may wish to take a look at this.
The 2007 Open Source Business Conference featured a panel discussion on the question of whether the Microsoft/Novell agreement is good for open source or not. Your editor was asked to sit on this panel and try to represent the community’s point of view – as if the community has a single point of view.
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In an article that is extremely bullish on Novell’s upside post-Microsoft, an analyst from JMP Securities disclosed that there have been a total of 49,000 SUSE Coupons distributed to date:
Though there have been worries that the duo’s deal—which critics say protects only Novell customers from Microsoft patent lawsuits—would be bad for Linux, it certainly seems to have been good for Novell.
“Novell suggested that it continued to see SUSE coupons distributed through its Microsoft channel, suggesting total certificates activated have risen to 49,000 from 40,000 at the time of its prior disclosure,” Mr. Fish said.
And at the Open Source Business Conference last week, Novell marketing director Justin Steinman said that thanks to “Microsoft’s sales force,” more users than ever were moving to Linux.
Nice one, Justin – perhaps the best line of the whole deal, so far. Of course, I don’t think he meant it the way I read it.
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Novell has updated its PR blog to counter what it believes to be a case of misinterpretation.
A number of articles about the filings indicate incorrectly that we are excluding OpenOffice from the covenant not to sue under the patent cooperation agreement. That’s not the case. This confusion likely stems from language in the agreements around a “grandfather clause” for certain products. The covenants Microsoft and Novell make to each other’s customers relate to ‘Covered Products.’ Some products with certain characteristics – known as ‘Excluded Products’ – do not qualify as Covered Products, and thus are not covered by these covenants. Certain products available before November 2, 2006, however, are automatically covered under these covenants, regardless of whether or not they have the characteristics of an ‘Excluded Product’. The reference in the patent cooperation agreement to OpenOffice simply means that it does not qualify for this automatic coverage. It does not mean it is not covered by the covenants. As we jointly stated with Microsoft in November, OpenOffice is covered under the patent cooperation agreement.
Elsewhere on the Web, there are various discussions that revolve around software patents and their effectiveness (or lack thereof). Here is a roundup that contains a few.
The Los Angeles Times seems to suggest that Microsoft is faced with a lose-lose situation. The only gain may be coming from the ability to instill fear in the mind of the prospective customer, which still weighs Free software options.
Is Microsoft fighting a losing battle? That’s the question posed by an op-ed piece in today’s Los Angeles Times. Maybe so, the writer concludes…
As the LA Times piece points out, whether Microsoft litigates the issues or not, the patent dispute with open source may well result in even fewer patent restrictions industry-wide than currently exist. But given that the trend toward open source and open standards shows no signs of slacking, that’s not necessarily bad.
Another op-ed from eWeek concurs entirely, at least on the issue of inevitability.
When Microsoft representatives state that everyone must play by the same rules, as they often have during recent months, what the company means is that the business and technological realities under which they’ve built their empire shouldn’t be allowed to change. However, just as the appeal of decentralized solar power will, once technologically feasible, prove irresistible, so too will the tide of free software that’s already begun rolling in prove too powerful to turn back.
RedMonk explains why the approach taken by IBM is the correct one. This implicitly suggests that Microsoft is making a big mistake.
In the wake of Microsoft’s deplorable patent commentary, I’ve had the opportunity to speak with a couple of vendors on the subject of software patents.
All things considered, of course, I’d prefer that software vendors take a stance that’s cognizant of the fundmental cracks in the foundation of our patent system. But if for whatever the reason, that’s not viable, I’d recommend they do the next best thing: don’t say anything at all. It seems to work fairly well for Big Blue.
Having made this mistake, Microsoft continues to put a spin on the recent developments.
Microsoft does not believe there is an inherent contradiction between its recent statements that free and open-source software infringes on 235 of its patents, and the veiled legal threats that go along with that, and its attempts to reach out and build bridges with the open-source community.
Of course, Microsoft understands that interoperability which is based on taxation is absurd, but it stifles the rivals’ progress, assuming Linux vendors do not have extensive patent portfolios or plenty of money to spare. It’s just part of that same old manipulative agenda, which a quick look at Microsoft’s so-called ‘Open Source’ licence pretty much aligns with.
The [MSPL] Patent Poison Pill
What happens if you file a claim regarding a patent implemented in the work? The MSPL section 3B says:
That is, if you initiate legal action against any contributor to the work regarding a patent which the work may infringe, your right to the patents of that contributor (under this agreement) go away.
With a patent protection clause as anemic as MSPL 3B, I wonder why even bother adding it to the license. Though I don’t really believe it’s this useless as part of some sinister master plan, I think it demonstrates that Microsoft still doesn’t understand that there’s no distinction, in terms of our licenses, in the FOSS world between users, contributors, and companies.
For that matter, Apple is no angel either, but for slightly different reasons.
There is a cost for not being a good Open Source citizen and that cost is loss of goodwill in the community. That loss is more expensive in the long run than Apple realizes.
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Talks about speculated and even recommended buybacks have begun to materialise. According to Reuters, Novell is now looking at the possibility of using its savings and assets to offset the losses and stablise the stock.
Hovsepian said during an analyst conference call he is looking to find the proper “balance” between those two potential uses for Novell’s cash war chest.
Meanwhile, MarketWatch chooses a headline which would make Novell raise a brow:
Novell’s profit slumps; Microsoft business drops
The Free Software Foundation, which controls licensing of open source code, has criticized the partnership. The Foundation is expected to soon release a new version of an open source license that could punish Novell, by preventing the company from distributing future versions of open source software. Hovsepian declined to comment on the new license, which is still in draft form. “When we see the final draft then we’ll have a better way to respond,” Hovsepian said.
It does not seem like Novell is as confident as it would like us to believe.
Addendum: Here is another important item which we seem to have overlooked.
Novell Cuts 2007 Revenue Outlook
Novell said Wednesday that revenue would be between $925 million and $955 million for the year. In December, the company said it expected 2007 sales of $945 million to $975 million.
Linux Journal seems to have become concerned about this.
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From the Shocking Revelations Department…
Larry Dignan is alleging that Novell is too heavily reliant on their partners, Microsoft:
Most of that pop came a quarter ago. For the second quarter Linux invoicing declined 75 percent from the first quarter. Sure it’s up a bunch from a year ago, but that’s a way easy comparison. Non-Microsoft related pieces of the Linux business fell 39 percent in the second quarter compared to the first quarter.
Playing with the numbers, SUSE sales without Microsoft had an invoice total of $11 million compared to the $29 million figure reported. The remainder of that sum is Microsoft.
It appears that analysts are also quite concerned about Novell’s reliance on Microsoft as their #1 channel partner:
Credit Suisse analyst Jason Maynard said in a research note that Novell’s organic Linux growth is worrisome. Says Maynard:
“Given the lack of organic Linux invoicing growth, we think it is doubtful that Novell’s Linux business will be a source of cash flow unless Microsoft buys more licenses or emerges as a meaningful channel for Linux sales. We however remain skeptical that Microsoft will become a champion of Open Source software.”
Some folks are just too cynical.
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For some reason, Novell’s PR Blog is stating that their take away from the Final Call Draft of GPLv3 "will not interrupt [their] partnership with Microsoft". So, if Novell’s assertion is true, this means that Microsoft is entirely comfortable with Novell passing on the (formerly discriminatory) patent covenant to all downstream users:
If, pursuant to or in connection with a single transaction or arrangement, you convey, or propagate by procuring conveyance of, a covered work, and grant a patent license to some of the parties receiving the covered work authorizing them to use, propagate, modify or convey a specific copy of the covered work, then the patent license you grant is automatically extended to all recipients of the covered work and works based on it.
The "Redmond Wall" has fallen, it’s Patent Detente Everyone! Woohoo!
Of course, as Paul McDougall points out, that just doesn’t sound like our friends from Redmond, especially given their recent acerbic statements.
Microsoft claims to own 235 patents that are infringed by open source software, including Linux. In November, it cut a deal with Novell under which it agreed not to sue Novell’s Linux customers. In exchange, Microsoft gained the right to resell Novell’s SUSE products and services at a markup.
So much for that.
If GPLv3 stands in its current form, it would appear to leave Microsoft with two choices. It can give up its patent claims on Linux and continue its partnership with Novell. Or it can terminate the pact. Given the way Microsoft jealously protects what it says is its intellectual property, I’m betting on the latter.
That’s bad news for Novell.
McDougall also brings up something I had wondered about recently, namely the deferred revenue that Microsoft already paid to Novell in advance for the 5 years of coupons – money Microsoft will probably want back if Novell needs to adjust or cancel the deal. Then, how much worse do Novell’s numbers get?
Who didn’t see this coming? Even Novell knew it was possible:
If the final version of GPLv3 contains terms or conditions that interfere with our agreement with Microsoft or our ability to distribute GPLv3 code, Microsoft may cease to distribute SUSE Linux coupons in order to avoid the extension of its patent covenants to a broader range of GPLv3 software recipients, we may need to modify our relationship with Microsoft under less advantageous terms than our current agreement, or we may be restricted in our ability to include GPLv3 code in our products, any of which could adversely affect our business and our operating results. In such a case, we would likely explore alternatives to remedy the conflict, but there is no assurance that we would be successful in these efforts.
The other day, I had stated that the FSF would determine Novell’s fate, but I misspoke: Microsoft will determine Novell’s fate, just as we always suspected.
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