SCO Should Win

By Rob Enderle  |  Posted 2004-03-05

SCO Should Win

Editors Note: There are two sides to every story, including the battle over Linux. To help crystallize the issues, we asked two of our columnists to take extreme positions to help clarify the upcoming court battles. Rob Enderles pro-SCO commentary follows. Dont miss the other side, as Linux Topic Center editor Steven Vaughan-Nichols takes the anti-SCO position in his analysis of "Why SCO Cant Win". Note that Enderle serves as an unpaid member of IBMs Industry Advisory Council, and his previous employer, Giga, worked with IBM. He has never worked with SCO.

The legal battle between SCO and the Linux community simply boils down to a larger firms attempt to take away the property rights of a smaller company in order to cover up an obvious error in judgment on the part of IBM.

IBM made a serious mistake in introducing Unix code into Linux without proper notification to—or approval from—SCO, which is the current, documented owner of Unix. The issue should have been fully vetted before Linux was compromised. The end result is a complex, no-holds-barred war against a much smaller company in an attempt to cover up and mitigate this mistake. In the process, the Linux community, in support of IBM, has been duped into using illegal means to attack SCO in the nastiest release of viruses the world has ever seen. The rest of us are used as cannon fodder in this virus plague.

Efforts to position this as a war between SCO and open source—or as having anything to do with Microsoft—are simply misdirection.

In a period when executives who misuse their authority are punished to extremes, the more likely cause of this problem is the apparent attempt to cover up an ill-advised decision by an IBM executive that unnecessarily exposed IBM and Linux.

Ask yourself these questions:

  • Have you ever seen IBM in similar litigation?
  • When is a $40 million company ever a real threat to a $90 billion company?
  • Can you recall an instance where IBM has aligned itself with a non-government organization that allowed, let alone promoted, violent response?
  • What would IBMs response be if a partner, or ex-partner, tried to release Lotus Notes or Tivoli, both technologies acquired by IBM, into the open-source community without permission?
  • If SCO has no evidence and is in the wrong, why is the company being so viciously attacked?

    What follows are not only answers to these questions but also evidence that SCO has rights to Unix, that IBMs error in releasing Unix (AIX) code into Linux violated those rights, that IBM used the Linux community in an attempt to cover up that mistake, and that the favorable outcome of this case is of critical importance to all of us.

    After assessing the following, you can only conclude that SCO should prevail. To take it further, Id say that, for our common good, SCO must prevail.

    Next Page: SCO owns Unix.


    SCO owns Unix

    Unix—which forms the core of AIX, Solaris, Digital Unix, BSD and HP-UX as the major variants—was originally owned by AT&T, which licensed it to others. The ownership rights passed through various paths to Santa Cruz Operations. Santa Cruz Operations then sold the rights to Caldera, along with the companys shortened name of "SCO." Caldera is now known as SCO. Every one of the Unix licensees knew of the transfers. There were no known, timely challenges to the related ownership transfers. Through this period, IBM, among others, maintained through documentation its responsibilities under its licenses with various Unix owners, including SCO.

    SCO and IBM entered into a partnership. The nature of that partnership remains unclear, but it surrounded SCOs owned Unix property. As do most partnerships, this one failed, and the parties went their separate ways. There is no evidence that the partnership activity changed SCOs ownership rights in any way.

    BSD is protected directly by a settlement agreement that dates back to AT&Ts ownership of the product. Sun and HP both have license agreements from that same period, as well as current agreements with SCO. Of the major players, other than BSD, only IBM lacks a direct license with SCO.

    While there now appears to be a broad attempt to undermine that ownership by companies such as Novell, which appear to be working in concert with IBM and the Linux community, the purchase and certainly SCOs intent appeared clear at the critical time of the actual purchase.

    Firms like Entrust and NTP are designed for litigation and are run by attorneys and intellectual property experts. SCO is not. Rather, despite accusations otherwise, SCO remains, first and foremost, a software company.

    If there was a doubt about SCOs ownership rights, it should have surfaced during, or shortly after, the purchase. The current actions by Novell and others are clearly connected to the IBM litigation and not the purchase, which makes them suspect.

    Most nations are founded on the belief that property ownership is a fundamental right. Whether that property is built or bought is not a material distinction; either you own it, or you dont. If we allow the rights of one individual or company to be violated by any group, does that not then weaken our own rights, as well? We operate by rule of law, not by rule of force. If we dont support the rights of others, who, then, will support our rights? The evidence on record currently supports SCOs ownership of Unix.

    Next Page: IBM executive error.

    ZIFFPAGE TITLEIBM Executive Error

    IBM executive error: Linux and IBM legal likely out of decision loop

    If IBM knew that SCO owned the rights to Unix, even if those rights were unclear, IBM policy would have required that the company seek SCOs approval before releasing any of the related code to a third party, such as the Linux community. Certainly IBM would do this for large partners such as Microsoft and for large enemies such as Oracle.

    Why not then for a small, ex-partner such as SCO? The fact that IBM did not approach SCO prior to its action violated SCOs ownership rights just as they would have violated IBMs rights had the two companies positions been reversed.

    I have worked for and with IBMs legal department for extended periods of time and know the group to be extraordinarily conservative. For instance, in the recent IBM laptop TV ad featuring the unique Thinkpad drop technology, legal intervened and defanged the effort.

    IBM legal ordered the last 20 seconds removed for fear that Dell might take offense. During the removed video, the laptop owner returns, looking for his recently dropped laptop, and says, "Hey, dude, wheres my laptop?"

    Legal presevered even though that last 20 seconds would have made the difference between a good ad and an award-winning one. Dells potential recourse, given that the company had distanced itself from "the Dude" some time ago, would probably have been trivial compared to the potential benefit to IBM.

    But back to Linux. The open-source community has asked on multiple occasions for OS/2 source to be released to them, as has the OS/2 community. IBM has refused, saying that it doesnt own all of the code, apparently in anticipation of the litigation that might result with Microsoft. Granted, Microsoft represents much more of a risk than SCO. The company is much larger and more powerful. But IBM should know as much about who owns what in OS/2 as it does with AIX. Also, power shouldnt be the key factor in determining whether any firms property rights are protected—including IBMs own.

    If IBMs legal department wouldnt have accepted even a minor "Dell Dude" risk, how did this one get approved? Particularly given that this precedent could potentially reduce IBMs own intellectual property rights? It appears to me that a serious mistake was made.

    If SCO was damaged by that mistake, which seems apparent, the company should be made whole by IBM and its agents. That rationale solidly supports the argument that SCO should prevail.

    SCOs actions not dissimilar to IBMs own

    Once SCO was made aware of the exposure, the company acted in a similar fashion to how IBM has historically responded when faced with a similar problem. IBM has protected its property portfolio aggressively against domestic firms like Digital and foreign firms like Hitachi and Fujitsu. SCO similarly initiated legal action against the firm that violated its property rights.

    SCO did, however, have to develop a unique strategy due to the unique nature of the Linux license and community. This uniqueness allowed IBM to position the Linux community against SCO and distance itself somewhat from the less-agreeable parts of the war and, hopefully, conceal the connection between the IBM decision maker and the resulting problem. These moves were incredibly well-orchestrated and apparently included donated equipment for sites like Groklaw. This unprecedented effort by IBM supports the position that IBM actually knows it misacted and is at extreme risk. No other explanation fits this massive and unique effort to destroy a vastly smaller firm.

    Next Page: IBM compounds the problem.

    ZIFFPAGE TITLEIBM Compounds the Problem

    IBM compounds the problem

    IBM decided to mitigate its exposure with a massive and (for IBM) unprecedented effort to remove the SCO threat. Part of this effort focused supporters on destroying SCO itself. It can be argued that this anti-SCO climate has been a breeding ground for recent virus attacks.

    Should these virus attacks be connected back to powerful IBM, the company could face extreme material penalties though a combination of SCOs potentially successful actions and related class-action-damage lawsuits connected to the attacks. While remote, there is no greater short-term threat to the company today.

    So why doesnt IBM simply buy its way out? Because it cant. To do so would force an internal review that likely would identify both the decision maker and the career-ending mistake.

    SCO should win

    This legal fracas simply amounts to an IBM executive decision gone terribly wrong. IBM should have fully assessed the risk and treated SCO as IBM itself always expects to be treated. Both SCO and the Linux community should have been fully informed before IBM introduced AIX into Linux, so that neither Linux nor SCO was put at risk. Had this been done properly, the virus and DOS attacks would have been unnecessary, and the resulting, broad damage to technology users worldwide could have been avoided.

    The Linux community and IBM have worked to extremes in attempting to put SCO out of business. They have strategically attempted to deny SCO both the right to enjoy the Unix property it acquired and even the companys own day in court. Neither the Linux community nor IBM are above the law and shouldnt benefit from their terrible tactics.

    We simply cannot afford any precedent that would encourage a group to use viruses, DOS attacks and additional illegal threats against any entity, be it a company or a government. The courts, not the streets, are the place for such a fight.

    We should also not allow any company, even one as broadly loved and trusted as IBM, to misuse its power to take another companys property rights by use of force or to cover up a clear mistake. IBMs actions put the companys clients, partners, investors and virtually everyone who uses a computer at risk.

    Therefore, because might does not make right, because an SCO loss would open us up further to attack, and because if we dont protect SCOs property rights we weaken our own, SCO must win.

    Dont miss the other side, as Linux Topic Center editor Steven Vaughan-Nichols takes the anti-SCO position in his analysis of "Why SCO Cant Win".

    Discuss this in the eWEEK Forum

    Rob Enderle is the principal analyst for the Enderle Group, a company specializing in emerging personal technology.

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