Microsoft takes on the free world (cont.)

By Roger Parloff, Fortune senior editor

An explosive reception

Microsoft and Novell unveiled their pact on Nov. 2, accompanied by endorsements from big Linux patrons and users like IBM, Hewlett-Packard, AIG, and - most startlingly - an organization called the Open Source Development Lab. The imprimatur of OSDL, a consortium of corporate Linux patrons (which has since merged into the Linux Foundation), carried the implicit blessing of its employee Linus Torvalds - a near-deity in the FOSS community.

(Torvalds has gravitated toward the business-friendly open-source camp of the FOSS world and has openly criticized Stallman's agenda in some contexts. In a March e-mail interview with InformationWeek he wrote: "The Free Software Foundation [Stallman's group] simply doesn't have goals that I can personally sign up to. For example, the FSF considers proprietary software to be something evil and immoral. Me, I just don't care about proprietary software.")

In free-software circles, though, the Microsoft-Novell entente was met with apoplectic rage. Novell's most eminent Linux developer quit in protest. Stallman, of course, denounced it. Not only did it make a mockery of free-software principles, but it threatened the community's common-defense strategy.

FOSS developers, who do not have the resources to defend themselves against a Microsoft patent suit, felt safe as long as powerful corporate Linux users shared their cause. But now the big boys could just buy their Linux from a royalty-paying vendor like Novell, getting protection from lawsuits and leaving the little guys to fend for themselves. What the shortsighted corporate types didn't grasp was that without the little-guy developers there might not be any high-quality FOSS for them to use five years down the road.

"We should talk," Stallman's attorney, Moglen, told Smith in a phone call a few days after the announcement. On Nov. 9, they met at the Software Freedom Law Center's tidy offices on Manhattan's Upper West Side. The Free Software Foundation was planning to prevent Microsoft from doing any more deals like the one it made with Novell, Moglen told Smith. It was drafting a new version of the GPL that would plug the loophole that Smith had just exploited.

Moglen had another card to play. In his view, the fact that Microsoft was selling coupons that customers could trade in for Novell Linux subscriptions meant that Microsoft was now a Linux distributor. And that, as Moglen saw it, meant that Microsoft was itself subject to the terms of the GPL. So he'd write a clause saying, in effect, that if Microsoft continued to issue Novell Linux coupons after the revised GPL took effect, it would be waiving its right to bring patent suits not just against Novell customers, but against all Linux users. "I told Brad," he recalls, "'I think you should just walk away from the patent part of the deal now.'"

Smith didn't, and Moglen kept his promise. On March 28, the Free Software Foundation made public revised GPL provisions, which are expected to take effect in July.

Microsoft and Novell both vow to proceed with their deal as planned. Microsoft claims that its mere distribution of coupons won't make it subject to the GPL, as Moglen asserts. But even if Microsoft is right about that, there's no doubt that distributors remain subject to it, and Moglen's revisions will bar them from trying to strike deals like Novell's.

That may be bad news for big corporate customers, which, judging from early reports, like the Novell deal. Presumably at least part of its appeal is that it provides peace of mind about Microsoft's patent claims. In the first six months, such marquee clients as Credit Suisse, Deutsche Bank, AIG Technologies, HSBC, Wal-Mart, Dell and Reed Elsevier have all acquired Novell Linux coupons from Microsoft.

Microsoft had hoped that the Novell deal would become a model it could use to collect patent royalties from other distributors of free software. In that respect, its "bridge" to the free world appears to have failed. That, in turn, seems to have taken us a step closer to patent Armageddon.

"The only real solution that [the free-software] folks have to offer," Smith says, "is that they first burn down the bridge, and then they burn down the patent system. That to me is not a goal that's likely to be achieved, and not a goal that should be achieved."

When it comes to software patents, though, Moglen thinks that's exactly the goal to be achieved. "The free world says that software is the embodiment of knowledge about technology, which needs to be free in the same way that mathematics is free," he says. "Everybody is allowed to know as much of it as he wants, regardless of whether he can pay for it, and everybody can contribute and everybody can share."

In the meantime, with Microsoft seemingly barred from striking pacts with distributors, only one avenue appears open to it: paying more friendly visits to its Fortune 500 customers, seeking direct licenses.

If push comes to shove, would Microsoft sue its customers for royalties, the way the record industry has?

"That's not a bridge we've crossed," says CEO Ballmer, "and not a bridge I want to cross today on the phone with you."  Top of page