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Patent News from Novell and Moglen - Updated - OpenLogic Webinar in Ogg format
Wednesday, May 23 2007 @ 08:33 PM EDT

Novell has just joined EFF's patent breaking effort. The two will work together to lobby governments and international organizations to "reform software patents worldwide" with a particular emphasis on WIPO. And Novell is providing funding to the EFF Patent Busting Project.

And I have news directly from Eben Moglen and from Kevan Barney at Novell, each telling me that Novell will be going public with the complete terms of the Novell-Microsoft agreement, Moglen says before GPLv3 is finished.

Update: Now there is a report by Stephen Shankland that Novell's Bruce Lowry just announced at the Open Source Business Conference that the agreements will be attached to Novell's annual report, which it will file this month with the SEC. However, he also says some details of the agreements will be redacted. GPLv3 will be ready in four weeks.

Update 2: We have the Moglen webinar in Ogg now.

I asked Novell a number of questions when the Dell announcement broke about Dell buying SUSE vouchers from Microsoft, and in that connection, I asked when we would get to read the complete terms of the patent peace agreement. Here's Barney's answer:

As is customary, the terms of the agreements between Novell and Microsoft are confidential, although the parties have disclosed many aspects of those agreements. Additional terms of the Patent Cooperation Agreement will be made public in Novell's future SEC filings.

I don't know how customary it is to enter an agreement, which allegedly the end users have done with Microsoft, if they don't know all the terms of the agreement first. We were told the parties were Microsoft and paying SUSE customers, not Microsoft and Novell. The interoperability agreement and the marketing cooperation were between the two companies, I thought, but not the patent deal. That's how my paralegal brain took it. However, it's clear we will eventually get to know the terms fully. Moglen was a bit more specific:

I have high confidence that the full relevant text of the MS/Novell agreements will be made available by Novell before the final publication of GPLv3, and that your readers and other members of the community will then be able to see more fully what RMS and I have done, and why we have done it. I will comment more fully at that time.

The OpenLogic webinar audio where Moglen explained the GPLv3 effect on vouchers with no expiration date will be available shortly, as soon as we get it all uploaded. It's very long, so we have it broken up into chunks. In connection with that, Moglen noted that some of you had questions, and he indicated that you'll get the whole picture when the agreements are made public by Novell:

I'd like to make a brief comment on the discussion Groklaw readers have had about these slides and the role MS coupons play in connection with GPLv3. Your readers are at a great disadvantage because they cannot see the terms of the actual MS/Novell agreements, which would reduce their uncertainty very much.

And here are all the questions I sent to Novell and all of the answers. In some cases, they are non-answers, but it's still interesting, particularly the answer to the last question about a Chinese wall. My questions are numbered, and his answers follow sequentially:

1. In what sense is Dell a consumer of the vouchers? Are they a paying end user, so that Dell has the patent peace protection from the vouchers?

Dell is not a consumer of vouchers (aka certificates). Dell simply contracted for the right to purchase the certificates from Microsoft to enable Dell to resell these certificates to its customers.

2. If not, and they are merely a conduit, why wasn't the arrangement that they'd get the vouchers as customers actually asked for them?

Dell's activities in reselling the certificates are no different from that of a channel partner purchasing offerings at an agreed-upon discount rate and then reselling such offerings to end users. Any pricing and commercial terms would be confidential and set forth in an agreement between Microsoft and Dell.

3. Does Microsoft have any vouchers left to sell? If not, will it be getting any more? Or is Dell taking over the distribution of those vouchers?

Microsoft has more certificates available to sell. Dell's channel relationship with respect to a relatively small quantity of certificates is addressed above. How, when, or at what price Microsoft sells the certificates is for Microsoft to decide, but Novell is not aware of any efforts by Microsoft to transfer or outsource the distribution of certificates to any third parties.

4. If the latter, and if, as per 1 they are the consumer, then how is it going to work that Dell can pass along the patent peace? I thought that was what an end user could not do? Is there some written agreement between you and Dell or Microsoft and Dell that spells all this out? In other words, is there a guarantee that buyers of the voucher will get the patent peace promise?

Novell and Microsoft agreed that they would make patent covenants to their respective customers. Novell customers may receive Novell products directly from Novell, or indirectly through partners such as Dell. Novell customers who receive Novell products through Dell may qualify for patent covenants directly from Microsoft.

5. On the patent peace, when will we be given the full details? I read where Steinman said SEC regulations forbid you to talk about it now, but my understanding is that you could amend the previously filed SEC filing that already mentioned this deal. Could you tell me precisely what SEC regulation or rule compels you to keep this clarification private? I'm unclear how customers can decide if they do or don't wish to purchase, if they don't fully know all the terms. Do those who already got vouchers, for example, have all the definitions referenced in the agreement but not defined? When will the terms of the vouchers be made public? Do you have to buy one to read one?

As is customary, the terms of the agreements between Novell and Microsoft are confidential, although the parties have disclosed many aspects of those agreements. Additional terms of the Patent Cooperation Agreement will be made public in Novell's future SEC filings.

6. Steinman has just been quoted in BusinessReview Online as saying that the patent peace agreement has two parts, and that part of it was to allow Novell the legal right to access Microsoft code regarding Active Directory. Can you clarify if that is accurate? My understanding was that the patent deal was between Microsoft and your end users directly, not between Novell and Microsoft.

The covenants Microsoft makes to Novell customers do not provide Novell with access to Microsoft code. The terms of those covenants are publicly available on the Web sites of both Novell and Microsoft. As announced in November 2006, Novell and Microsoft have entered a Technical Collaboration Agreement under which the companies work to achieve interoperability between Novell and Microsoft offerings. When ISVs enter such agreements, the terms customarily provide for exchanging relevant technical information. Novell has no intention to distribute the code of Microsoft or any third party in an unauthorized manner, and employs customary measures to comply with our license obligations.

7. Did Microsoft sell its vouchers to Dell, if indeed they did sell them 100% to Dell, at least in part to avoid being a distributor of GPLd software and so coming under the terms of GPLv3?

Microsoft would be the best party to answer that question.

8. You mention that Dell bought them in part to show support and validation of the deal. Would not Dell buying vouchers directly from you have achieved the same result, with the end being that both Microsoft and Dell could sell vouchers?

Dell's limited participation in the Novell-Microsoft relationship includes elements of marketing, support and discounted purchase rates between Dell and Microsoft that would not have been possible in a simple two-way partnership between Novell and Dell. As we've said previously, the certificates are a unique offering that Novell created specifically for the Microsoft agreement, and thus it was important for Dell to participate in this offering as a symbol of their support for our agreement.

9. In the 2007 Open Source Think Tank video, Microsoft's Sam Ramji mentions, when asked if Microsoft actually has any IP in Linux, cloning. Can you explain? Was he referring to Mono? Samba? OpenOffice?

These questions would best be posed to Sam Ramji.

10. If Novell has access to Microsoft's code, do you have a Chinese wall set up, so that others who may accept the GPL code you write thereafter is not contaminated and hence liable to claims by Microsoft regarding copyright infringement, cloning, etc.?

This is not a novel situation; any ISV in a mixed-source environment must address this issue and there are customary ways of doing so.

Meanwhile, Antone Gonsalves at EETimes reports that Microsoft says it isn't attacking Open Source. It is just responding to customer demand. Shades of SCO. Must be the same customers SCO told us were begging them to set up SCOsource licensing. Here's what Microsoft's Bob Muglia said:

Muglia said Microsoft was focused on interoperability with open source software, not on challenging the use of its intellectual property in court. "Our approach is a licensing based one," Muglia said. "It's a real issue for customers, and one that Microsoft is addressing proactively."

I just can't turn off my paralegal brain, which translates that to say: We won't sue you as long as you pay us. I believe I can get similar terms from the Mafia.

This is just Microsoft's way of killing off the Open Source development model, as I see it. FOSS coders are individuals, not companies, and they give their work away, for the most part, so where are they going to get money to pay for licenses? And yes, Microsoft has to know that this is an attack, an arrow straight at the heart of FOSS. Anyway, Microsoft customers can get interoperability without anyone having to pay anything. Let Microsoft simply follow standards without extending them and open up enough for folks to interoperate, as the EU Commission has told them to. Then we can all interoperate and Microsoft's customers will be happy and so will FOSS.

I know. But that is the correct answer.

Update: Another part of Shankland's report has this offensive bit, from Justin Steinman. Who else?

Microsoft's patent tally news both pleased and displeased Novell, said Justin Steinman, the company's marketing director for Linux.

On the displeased side, Novell saw the news as "another round of, '0h no, here we go again.' We generally think comments like that aren't productive," Steinman said.

On the pleased side, Novell potentially can profit from the saber-rattling. "If Microsoft is going to go out and raise concerns, we are comfortable we can offer (customers) coverage," Steinman said. Overall, though, Novell wasn't pleased. "Do we wish the tone of the article had been different? I think so."

I could probably make some money selling my mother's blood, if I had no conscience. Or I could rob a liquor store. There's money in that, I hear. Profit isn't the only indicator of whether a deal is a good idea or not.

Update2: Here we go, the Moglen webinar in which he informed the world that the SUSE vouchers have no expiration date and what that will mean for Microsoft once GPLv3 is in place. It is titled "Maximizing the Value of Open Source in the Enterprise". Our thanks go to Rick Stanley for doing the Ogg file for us, and we thank OpenLogic also for giving him permission to make the proprietary file available in a format you can use. The webinar is quite long, so Rick also broke it into four segments for those of you on dialup:

Part 1
Part 2
Part 3
Part 4

As you can see from their blog entry, the thanks are mutual, because OpenLogic didn't know how to translate into Ogg format, and so he not only offered to do it for them, he taught them how to do it for the rest of their files, at their request. Thank you, Rick.

More news from OSBC. The panel discussion on "Is the Novell-Microsoft Deal Good for Open Source?" (there was a second panel, "Is Cancer Good for Communities?" -- kidding) had Jonathan Corbett explaining why it can never be good, as reported by Charles Babcock at InformationWeek:

Jonathan Corbet, an active Linux kernel contributor and executive editor of or Linux Weekly News for developers, said major software makers have patented "thousands of trivial functions" used repeatedly by other systems. "There's no way to write a non-trivial program that can't be claimed to infringe on someone's patents." Microsoft itself is on the defensive "in a couple of dozen patent suits" where other firms say Microsoft has infringed on their patents.

That, Corbet said, makes it hard to reconcile Microsoft's offensive use of patents against open source. "When the CEO of Microsoft goes around saying Linux users have an undisclosed liability on their balance sheets, that's a classic fear tactic."

When Microsoft suggests that Linux developers have stolen its IP, "I feel that I've been called a thief," he said. As a result, he concluded, the Microsoft/Novell deal might be good for Novell "but it's not good for the community" of open-source developers and users.

People who don't grok the GPL have a harder time seeing the problem. There is a reason why around 70% of projects on Freshmeat are released under the GPL. FOSS programmers trust it. And anything that undermines it undermines their work and violates their trust. That is the bottom line.

I think Microsoft probably does understand that, and that is exactly why it wishes to undermine it. The Supreme Court in the recent KSR decision has thrown tacks in Microsoft's roadway, of course. All those obvious patents Corbet mentioned are not useful to anyone now, because they are obvious and can't stand legal scrutiny. And GPLv3 is the nuclear weapon that will finish the patent peace strategy. But I'll never forget that Microsoft tried this, and I'll never forget that Novell sold out the GPL for a personal leg up at the expense of the community. No doubt my future purchases will reflect that remembrance. And I hope the community and EFF watch them very, very closely as far as their lobbying effort is concerned. I am not comfortable that they comprehend the views of the community; how then can they represent it?

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