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February 9, 2007 11:23 AM PST

Microsoft: Novell deal a milestone despite squabbles

Last modified: February 9, 2007 11:25 AM PST

SAN FRANCISCO--Microsoft's deal late last year with Novell may have set a record for shortest honeymoon, with the two companies publicly bickering within days.

Nonetheless, Microsoft top lawyer Brad Smith hails the deal as a landmark that still holds the potential of bringing together the open-source and commercial software business models.

"I actually think that when the decade is through, we'll look back, and we'll say the agreement between Microsoft and Novell was one of the most important milestones in the decade from an (intellectual property) perspective," Smith said Thursday at a dinner with a handful of journalists.

Brad Smith Brad Smith

That may be, but the two principals in the deal have hardly been sending love letters to one another. Microsoft and Novell on November 2 announced the pact, under which Microsoft agreed not to sue Novell Linux customers for patent infringement, while Novell agreed to pay Microsoft royalties, among other provisions.

That same month, Microsoft CEO Steve Ballmer claimed that the deal amounted to an admission that Linux infringes on Microsoft patents. Novell CEO Ron Hovsepian took issue with that in an open letter.

"Our agreement with Microsoft is in no way an acknowledgment that Linux infringes upon any Microsoft intellectual property," Hovsepian said in the letter.

Public agreement isn't necessary, so long as the deal is in place, Smith said.

"People can debate how much (the patent protection) is needed, but the reality is it's provided," Smith said.

And while Microsoft and Novell exchanged verbal jabs, customers have really taken to the notion, Smith said. Under the deal, Microsoft resells certificates for Novell Linux software and support. In the three months since the deal was inked, Smith said, Microsoft has seen far more sales of the certificates than it had anticipated. The company initially laid plans for up to 70,000 certificates to be sold in the first year. In the first three months, it has already sold more than 35,000, according to a company representative.

Smith is also looking for pacts with other companies that distribute Linux or use it in their products.

"We are having discussions with other companies that I think share an interest in exploring this kind of model," Smith said. "That includes companies that distribute open-source software, and it includes companies in the embedded space."

He declined to offer any specific names, however.

See more CNET content tagged:
Brad Smith, Novell Inc., Novell Linux, certificate, milestone

Add a Comment (Log in or register) 27 comments (Showing first 20 comments)
Too funny
by Arrgster February 9, 2007 12:49 PM PST
"I actually think that when the decade is through that we'll look back and we'll say the agreement between Microsoft and Novell was one of the most important milestones in the decade from an (intellectual property) perspective,"

Ya as the beginning of the end of Suse... I used both Red Hat and Suse before this agreement, now I only use Red Hat.

MS only does things in the effort to make things better for MS. Open source movements do things in the effort to better things for the software itself. Better software equals better things for the customer and society as a whole.

Red Hat makes it's money on services not the software. Red Hat also does things in an effort to make things better for Red Hat, but it's based on open source which is a more customer friendly model. Therefore you are in a better position as a customer because there is never any concern of theft or software audits, plus the prices are lower.

In the case of Novel, they are getting in bed with a company that is notoriously customer unfriendly and it can only lead to the same result coming from them. I guarantee you that in no time you will start to see these same kind of threatening things coming out of Suse that you do MS. Things like software audits and school teachers getting hauled of to Siberia... That's why I won't use them, not until they break the deal..
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The bottom line is...
by t8 February 9, 2007 2:08 PM PST
The bottom line is many people do not trust Microsoft and haven't got time to read small print. Now the suspicion is passed onto SuSe.

But there are plenty of alternatives that are safer for customers.
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Customer unfriendly? You're out of your mind.
by WJeansonne February 9, 2007 3:36 PM PST
Linux is customer unfriendly with its arcane interface and cobbled together OS. Microsoft is king of the heap because it provides something called VALUE. Take a class an business and learn what value means, please!
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I guess if you can't beat 'em...
by C_G_K February 9, 2007 5:00 PM PST
What I would like to know is how much is Novell paying Microsoft in royalties? If the amount is reasonable, then it's probably a good deal for everybody. Given M$'s track record, I am skeptical. Seems kind of like giving your lunch money to the neighborhood bully so that he won't beat the tar out of you.
Another question, Novell has some link to opensuse which it distributes for free. There is, I'm sure, nothing in the deal that keeps M$ from suing for patent infringement over the free versions since no royalties are paid. So much for free open source software and operating systems... If the free versions are protected (doubtful) then this would truly be a breakthrough.
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New and unique deal, but same MS here.
by Microsoft_Facts February 10, 2007 3:40 AM PST
MS calls open source "viral", has tried to crush companies that promote open source, now they want to promote interoperability?

I think not. Look at the facts: Every threat to Microsoft's illegal monopolistic behaviors and practices is met with "Embrace and Extend" or "Embrace and Extinguish." This situation is no different. Microsoft has no desire to see this agreement work.
Reply to this comment
Still smells fishy.
by Penguinisto February 10, 2007 4:37 PM PST
Three words: "Plays For Sure". Ask MSFT's partners in that deal
how things went for them.

I think MSFT is trying for the same play here (to wit: "Embrace,
Extend, Extinguish"). That said, I think MSFT seriously
underestimates what they think they're getting into here.

That, or they're trying to wipe out at least one distro maker, that
being Novell. Problem is, RedHat's distro and its variants are
dominant... even if SuSE fell off the Earth tomorrow, it wouldn't
slow down Linux' dominance in the server arena, or its explosive
growth elsewhere.

/P
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