SCO Launches $1 Billion Unix, Linux Lawsuit Against IBM

by Timothy Prickett Morgan

Unix and Linux operating system maker The SCO Group has launched a lawsuit against former partner and one-time Unix ally IBM that accuses Big Blue of willfully distributing Unix intellectual property to the Linux community and of undermining the Unix market with anti-competitive business practices. SCO is seeking $1 billion in damages and is requesting a jury trial in its home state of Utah. The company says that it has given IBM 100 days to settle or face revocation of its licenses to Unix.

The fight between SCO and IBM has implications for the OS/400 installed base in four distinct and important ways, which I will get into after explaining just what is going on.

First, we need to review a little operating systems history. In the 1960s, AT&T created the Unix operating system, and the C programming language for creating that operating system, to have an alternative and more streamlined platform than IBM's mainframe platforms, on which to build its telecom switch and back office systems associated with its phone services. Unix gradually made its way into academia, thanks to AT&T's open-source and open-systems policies. And by the late 1980s, a number of companies were creating variants of this Unix operating system, called Unix System V, as well as a number of other variants, such as the Berkeley Systems Design (BSD) variant, which is at the heart of Sun Microsystems' Solaris and Apple's Mac OS X. IBM's own AIX operating system is based on a different Unix kernel, called the Mach kernel, which was created at Carnegie Mellon University in Pittsburgh, but many of the layers of Unix functions that ride on top of this kernel are apparently based on Unix System V. (The BSD strain of Unix also uses the Mach kernel, by the way.) By the early 1990s, all the major server makers--including IBM, Sun, and Hewlett-Packard--had developed their own flavors of Unix and owning the Unix intellectual property was not something that AT&T was interested in any more. That's why AT&T sold the whole Unix enchilada to network operating system vendor Novell, which thought it could sell high-end Unix for supporting applications and databases on Intel-based servers against the RISC/Unix players, because its own NetWare file serving applications were not very good for this. After years of struggling to make its UnixWare operating system make money, Novell sold Unix in 1995 to Santa Cruz Operation, which had created its own implementation of Unix for entry machines (which is now known as OpenServer and is distinct from UnixWare). Last year, commercial Linux distributor Caldera International ate SCO, then changed its name to SCO Group because of the name recognition that SCO had had over the past decade. Earlier this year, SCO said that it would begin policing its Unix licenses very aggressively, and it hired David Boies, the top-gun lawyer who argued the government's latest case against Microsoft and prevailed until the appeals process began, to help it consider its options.

One other twist in the SCO-IBM lawsuit is a partnership between the two companies and Sequent Computer Systems, a supplier of NUMA-based servers that was eaten by IBM for $1 billion a few years ago and was then promptly ignored to death for developing a single version of Unix, dubbed Project Monterey, that would run across 32- and 64-bit Intel chips and 32- and 64-bit IBM Power chips. This deal was complex, and while SCO claims that the development work was done, IBM essentially pulled the plug on Project Monterey in May 2001. While the claims that SCO has made against IBM are complex and involve some 20 years of history in the Unix market, here's what the lawsuit boils down to, at least as far as SCO is concerned:

• IBM gained access to key intellectual property and coding methods by virtue of its involvement in Project Monterey, and it benefited from that access and continues to do so today, including the latest AIX implementation for its Power-based servers.
• IBM has knowingly and willingly helped to port key elements of Unix to the Linux community, and it has been helping the Linux community extend Linux to be a better, more scalable operating system than Unix. SCO contends that its licensing agreements with IBM concerning Unix specifically prohibit IBM from using the intellectual property and coding techniques it gained as a licensee of Unix for AIX and as a partner in Project Monterey to help the Linux community.

IBM may be in love with Linux, but SCO is feeling jilted, and rightly so. The question now is what the lawyers will be able to demonstrate on either side of the case. IBM has not yet released an official statement on the case except this: "Our Unix license is irrevocable and perpetual. AIX is the fastest growing Unix in the industry as a result of our commitment to open standards and our credibility as a technology innovator." That's not exactly the same thing as a strong denial. However, brokerage house Merrill Lynch said in a report on IBM it put out on Tuesday that Bill Zeitler, head of IBM's Server Group, told its analysts in a meeting that the allegations made by SCO--that IBM misappropriated trade secrets in providing AIX code to the Linux community--were baseless. Zeitler, according to Merrill Lynch, said that SCO's assertion in the suit that Linux "couldn't have grown up without stolen code" was insulting to the Linux community. He reiterated that IBM's license to Unix was perpetual and irrevocable, which is something that IBM's lawyers at Cravath, Swain, and Moore, in New York, and the teams at Boies, Schiller, & Flexner (which is ironically located in IBM's headquarters in Armonk, New York) and at Hatch, James & Dodge (the firm's first partner is the son of U.S. senator Orrin Hatch of Utah, by the way) will certainly be arguing about.

The question of the week is whether IBM would just be smarter to acquire SCO instead of trying to settle this thing in the courts. SCO's market capitalization has tripled in only a few weeks to $37 million, driven mostly by the threat and then the filing of this lawsuit. It might be cheaper, easier, and better for IBM--and indeed any of the Linux or Unix players who might be hit with similar lawsuits--to acquire the rights to Unix completely and then give it away to the Linux community than it would be to fight SCO in the courts. And if IBM doesn't do it, now might be a good time for HP or Sun to step up to the plate before Microsoft does it and causes some real big trouble.

If you think that this lawsuit doesn't affect the OS/400 platform, you are wrong. It most certainly does. First, IBM had planned to release support of AIX native within hypervisor-based logical partitions, starting in 2004 with the debut of OS/400 V5R3 and the Power5-based "Squadron" (formerly known as "Armada") servers. There are plenty of large manufacturers, insurance companies, and financial services companies that run a mix of OS/400 and AIX jobs that undoubtedly were looking forward to possibly consolidating their workloads on a single machine with dynamic partitions. (If this were not the case, why would IBM bother? Big Blue only does things because it believes to do them makes money.)

If, by some outside chance, SCO does in fact prevail in the courts and gets an injunction to prohibit the sale or use of AIX--it's hard to say if this could happen, but the national security and economic implications are large, considering the prevalence of AIX machines in corporations in America and other Western countries, and this diminishes the chances that SCO has in prevailing in the courts with such a maneuver--any OS/400 shop that has or is in the process of acquiring an AIX kit will be affected, too. It's not just about AIX in iSeries partitions.

It is also unclear what any legal maneuverings against IBM would have on the OS/400 PASE AIX runtime environment that has been created to run AIX applications within the last few releases of OS/400. Plenty of ISVs and customers are using this feature, and a court order could (in theory) shut them down.

And, finally, those OS/400 shops that have implemented Linux for PowerPC on their iSeries servers could also be affected by SCO's legal attacks as SCO moves from naming IBM as the illegal distributor of Unix trade secrets and intellectual property to the open source Linux community and the commercial Linux distributors as receivers of these secrets and information.

Sponsored By DRV TECHNOLOGIES

SpoolFlex Spool Management for your iSeries or AS/400 The SpoolFlex application is comprised of two parts: the PC Client tool for mapping fields the iSeries spool management tool suite With the PC Client tool you can quickly and accurately view your spooled files and map one or more fields. Any mapped field can then be used with SpoolFlex tools on the iSeries to automate virtually any spool related function. COPY ♦ MOVE ♦ DELETE ♦ SORT ♦ SPLIT ♦ EMAIL ♦ CONVERT ♦ MONITOR ♦ INTEGRATE and more... In today's economy, with scaled down staff and strained budgets, companies are searching for new ways of reducing costs, while maintaining or improving operations. According to Richard Voss, president of DRV Technologies, one way to help with this problem "is to identify repetitive, manual tasks and find ways to streamline and automate those tasks." And that is what SpoolFlex is all about - automation - specifically the automation of spool related tasks on your iSeries. This suite of tools provides a central point of control with robust features for manipulating your spooled file data. At the heart of it are two key automation components, Spool Sentry and Process Definitions. Spool Sentry is an output queue monitor that can watch any number of output queues for particular reports. Once a definition is created that identifies the spooled file(s) to watch for, you can automate the process by designating a start time as well as a frequency for activation. But Spool Sentry is more than just an output queue monitor. When Spool Sentry is activated and the designated spooled file hits the output queue(s), the Process Definition takes over, executing all the pre-defined actions. Using these two features you can automate almost any spool related task on your iSeries. If however, you need a feature or function that is not included in the existing tools, send us your request and our staff will promptly review it for future versions. We welcome your input! Let the SpoolFlex suite of Tools be your central point of control for all your iSeries spool management needs. Affordable Quick installation, easy to use No programming or spooled file changes Works with virtually any third party application Output queue monitor (Spool Sentry) Tools to copy, move, delete, sort, split, email Convert output to e-formats like PDF, CSV, HTML or Text Automate SpoolFlex tools, custom APIs, IBM CL commands With its modular tools, purchase only what you need, priced from $495 to $1595. Flat price means no additional fees for hardware, partition or processor upgrades! Visit www.drvtech.com or call 770-674-1491 to request a FREE no obligation 30-day trial.