10.10.09

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ECIS on the Patent Licensing Paradox, Microsoft Confesses Licensing Tricks

Posted in Antitrust, Europe, Free/Libre Software, Interview, Microsoft, Patents at 11:29 am by Dr. Roy Schestowitz

European map

Summary: Further discussion of the European Commission’s provisional agreement with Microsoft; licensing complications at Microsoft turn out to be deliberate

THE European Commission has permitted Microsoft to discriminate against Free software [1, 2] and it also failed to address Microsoft's racketeering tactics against Free software. Most press coverage, however, is focused only on the terms regarding Web browsers and a screen-based ballot.

Groklaw has this new audio chat (with transcripts) regarding the latest developments. Here is an interesting part of it:

Ashwin van Rooijen: Yeah. Well, I think the open source issue is important. In many markets, Microsoft faces meaningful competition — any meaningful competition — only from open source developers. So it is very important that they can actually create interoperable products. And the current template patent license that was part of the undertaking — I believe it was Annex C of the undertaking — is clearly not compatible with open source licensing schemes and especially not with the GPL. It requires, for example, that developers that take a license, that take a patent license, notify all the other developers that they distribute the software to of the various patents which Microsoft claims to have in its software. And obviously, that’s an obligation which cannot be reconciled with the GPL. And there are other provisions as well which I think would need to be resolved.

38:34

Q: Well, there’s also been a history of Microsoft claiming patent infringement, but not communicating the numbers of the patents in question.

38:42

Thomas Vinje: that’s been a very serious issue indeed. And patent FUD, in that regard –

38:48

Q: Fear, Uncertainty, and Doubt.

38:49

Thomas Vinje: Fear, Uncertainty, and Doubt, which we certainly believe and has been engaged in to cause concern mainly among potential consumers of open source software about potential patent liability. That’s been a serious concern. There are some things in this proposed undertaking that would help to address that problem. And we should say more generally that not everything in the proposed interoperability undertaking is bad; there are some very serious problems with it, some really rather obnoxious devils in the details –

39:28

Q: Could you be more specific?

39:29

Thomas Vinje: Well, we’ve been talking about the patent one, and the standards one, and we could address other ones as well. But nonetheless, there are some — we’re not certainly saying that it’s unsaveable — I mean, this is a document which could be modified and turned into something which would be very useful. Not necessarily a panacea, it’s not going to change the landscape of the industry and make it competitive tomorrow in ways that it isn’t today, or even next year in ways that it isn’t today, but it potentially would be a very useful arrangement. Ashwin, I’ve spoken a lot, why don’t you mention some of the other devils in the details of the proposed interoperability undertaking?

The good news is that there is still room for modification. Microsoft has attempted to complicate things for Free software, using fees that supposedly correspond to software patents (they are not legal in Europe).

Speaking of complication in licences, IDG has shed some light on why Microsoft licensing is such a complicated thing. The truth may seem like a joke, but it’s not; it comes from Microsoft’s own mouth:

Navigating Microsoft’s complex rules and programs for software licensing has been notoriously difficult for businesses — a pain point not lost on the company, which for years has said it is trying to simplify the process for customers.

But remarks made recently by Microsoft’s top executive, as well as suspicions raised by customers and software consultants, suggest that Microsoft keeps its licensing complicated for a reason, and that it has no plans to make it any simpler in the foreseeable future.

[...]

Customers tend to take a big-picture view of licensing, according to Elop — that is, they look at the value it adds to their businesses overall, rather than dwell on the minutia of individual licenses required for the products they use.

“Customers want the amount they pay to be tied to the value that they’re driving, the usage they’re getting — that’s why these models are so complicated,” he said. “For different customers, these things are measured in different ways.

“What a customer will do generally is take a big step back and say, what am I paying for e-mail? What am I paying for collaboration? And they will make a determination as to whether they think that’s fair value or less than fair value,” he said.

Ouch. Why has Microsoft said the truth out in public? It would be used against it now that the cat is out of the bag.

“Usually Microsoft doesn’t develop products, we buy products.”

Arno Edelmann, Microsoft’s European business security product manager

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