Guild Companies

If you bought a Linux license packaged by a major commercial Linux distributor such as Red Hat or SuSE from Hewlett-Packard, then installed it on an HP desktop or server and have not messed around with the source code inside Linux (but are rather just running the binaries straight out of the box), then HP will indemnify you from having to pay Linux intellectual property licensing fees to The SCO Group and will cover your legal bills in the event that SCO takes you to court.

HP has not yet been directly involved in the $3 billion SCO-IBM lawsuit over Unix intellectual property. Nor has it stuck its nose into the spinoff lawsuit that Red Hat has filed against SCO. But HP wants to wants to surf the upwardly flowing Linux market, which, depending on the platform, is growing at 30 to 40 percent, and it wants to be the dominant Linux vendor. And that means sucking it up and doing what IBM, Dell, and Sun Microsystems haven't done: covered their Linux customers' backs and backsides.

Martin Fink, HP vice president of Linux enterprise servers and storage, held a press conference last week outlining what the company is doing. Any customer who buys a Linux license for HP iron or a machine that already has Linux bundled on it, and who maintains a support contract for that Linux license, is privy to the indemnification. Customers can only run the binary code in the Linux distributions, and an addendum to the HP sales contract for the Linux machines says that if they modify source code and put it on the HP machines, the indemnification is void. Let's be clear, here, to avoid confusion: you can't change one line of Linux code. This indemnification will be in effect on all HP devices sold after October 1, and on any Linux licenses bought through HP for existing machines as of that time. Customers with existing HP Linux boxes can get the indemnification by working with HP to ensure that they haven't messed with source and by signing the addendum that says they will not.

Fink says that HP has not signed any intellectual property agreement with SCO that gives it the confidence to offer this indemnification; rather, HP has spent months in weighing the risks of offering safe harbor to Linux customers against the benefits of using fears of lawsuits and licensing fees to its competitive advantage. HP is the first IT vendor to offer indemnification, by the way, and depending on how this shakes out, it could be the only one or one of many.

"Today's announcement is about accountability and protecting the customer," said Fink last week, "while the other vendors sit on their haunches. The future of Linux has never been brighter, and HP is giving customers the green light on their Linux deployments." While this is true, HP would not be risking untold sums of money from potential lawsuits if it didn't think it could make some money by turning this bad Linux situation into a competitive advantage. And while Fink denied that the SCO lawsuits have dampened Linux sales, it is hard to say what Linux would be doing if there were no suits. For all we know, Linux growth would be accelerating even more in the past six months absent the suits.

SCO, which has no shortage of wiseguys, turned the HP indemnification on its ear with its own short statement:

"HP's actions this morning reaffirm the fact that enterprise end users running Linux are exposed to legal risks. Rather than deny the existence of substantial structural problems with Linux, as many open source leaders have done, HP is acknowledging that issues exist and is attempting to be responsive to its customers' request for relief. HP's actions are driving the Linux industry toward a licensing program. In other words, Linux is not free.

"We are gratified that, alone among the major Linux vendors, HP has taken a strong stand to protect their customers by indemnifying them against possible legal difficulties stemming from their use of Linux. We believe that this action signals that HP recognizes their Linux users could, in fact, face litigation because of copyright violations and intellectual property problems within Linux. As a company that strongly supports its customers, HP has done something about this. Now that HP has stepped up for its customers, SCO once again encourages Red Hat, IBM and other major Linux vendors to do the same. We think their customers will demand it."

It's hard to say what Linux customers (or AIX customers, for that matter) will demand. Whatever IBM's customers are saying to Big Blue remains a secret, but IBM's position is not. The company released the following statement at the same time HP announced its indemnity offer: "HP's announcement--and those of Red Hat, government agencies around the world, and others--appears to flow from the belief that SCO's claims against Linux are baseless. We agree. IBM's position has not changed. We will fight this in court."

That sure doesn't sound like a promise to offer Linux and AIX customers any kind of indemnification. IBM and many others, including open source advocate Bruce Perens, think it isn't useful. So this is not surprising. (See "IBM Says Indemnity Is Useless, Amends Claims Against SCO," for more information on IBM's amended complaint and for a more detailed response to the indemnity issue.)