Microsoft-Novell Deal Has Escape Clause

Published: May 30, 2007

by Alex Woodie

Microsoft may stop distributing coupons for SuSE Linux if certain changes to the GPL v3 are put into action, Novell disclosed in a regulatory filing late last week. The revelation is the latest twist in the ongoing struggle between backers of the open source Linux operating system and Microsoft, the largest developer of proprietary software.

For years, Microsoft has asserted that certain parts of Linux, among other open source programs, violate its patents, but it has made little effort to detail which parts, let alone stop the violations by taking vendors or users to court to obtain royalties. Last November, the company took a big step forward when it signed a landmark deal with Novell to come to an agreement over intellectual property rights, the supposed IP violations, and to put customers who use both Windows and SuSE Linux at ease about possibly being sued. As part of the deal, Microsoft agreed to distribute coupons that its customers could use to purchase SuSE Linux Enterprise Server from Novell, the idea being that Microsoft would not sue these Linux customers for using software that infringes upon its patents, because it has been compensated for them through cross-licensing payments SuSE made to Microsoft.

Because of this deal, other Linux vendors, notably Red Hat, were put on a different level than Novell and SuSE. It also left open the possibility that Microsoft may come looking for compensation for the supposed IP violations being perpetuated by other Linux users around the globe. Microsoft has indicated that it doesn't want to resolve the situation through lawsuits, but instead would rather set up deals similar to the one with Novell to get other Linux vendors and users on the up and up with its IP--something that the Linux and open source communities have strongly objected to. (However, when Microsoft said the deal was a de facto admission by Novell that SuSE Linux violated Microsoft's IP, it really put the fork in potential deals with Red Hat and others.)

While all this was going on, the backers of the GNU General Purpose License (GPL)--the licensing scheme under which Linux is distributed--have been seething at Novell's actions, and plotting to find a way to get back at Microsoft and its perceived weakening of the GPL and Linux through Novell's deal with Microsoft. The Free Software Foundation (FSF), which controls the GPL, has plotted to add elements to the new GPL v3 proposal that would put an end to the deal and force Microsoft out of the Linux business--or bend it to its open-source persuasion.

What the FSF came up with was a plan that would make Microsoft subject to the GPL by emphasizing its role as a Linux distributor. Since the GPL strictly forbids patents, if Microsoft continued to distribute Linux through the SuSE coupon deal, it would legally block Microsoft from seeking compensation for supposed violations of its patents, not only from Novell SuSE customers, but from all Linux users. This is the gist behind GPL v3, and because GPL has teeth and is enforceable in a court of law, it may just work.

And that's the fear that Microsoft has with GPL v3, which is expected to go into force in July, although it's still not clear if Linus Torvalds, the primary developer of Linux, will adopt GPL v3 for the ongoing distribution of the Linux kernel. Torvalds last year indicated displeasure with GPL v3, and pledged to continue to distribute the Linux kernel under GPL v2. But in the end, it likely won't matter, because many elements of a Linux distribution will be licensed under GPL v3 anyway, giving it teeth whether the kernel is licensed under GPL v3 or not.

According to its 2006 annual report Novell filed with the Security and Exchange Commission on Friday, Microsoft may call off at least part of the deal with Novell if those provisions of the GPL go into effect with v3.

"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," Novell stated in the document.

Despite the sour treatment Novell has received from Microsoft and the pressure from the open source community, Novell is committed to the deal. Whether outside forces like the GPL v3 ultimately end it has yet to be seen.

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