Microsoft claims software like Linux violates its patents

Microsoft claims that free software like Linux, which runs a big chunk of corporate America, violates 235 of its patents. It wants royalties from distributors and users. Users like you, maybe.

Folks, it is time to take a stand. Yes, everyone is doing it (see patent activity chart), but that doesn’t make it right. I have quoted extensively from this well written article. Of course, Microsoft likes to play both sides of the issue, with their arguments carefully crafted to support their MBAs (Microsoft Benefit Analysis). Once again, innovation takes a back seat when Microsoft steps in.

Free software is great, and corporate America loves it. It’s often high-quality stuff that can be downloaded free off the Internet and then copied at will. It’s versatile – it can be customized to perform almost any large-scale computing task – and it’s blessedly crash-resistant.

A broad community of developers, from individuals to large companies like IBM, is constantly working to improve it and introduce new features. No wonder the business world has embraced it so enthusiastically: More than half the companies in the Fortune 500 are thought to be using the free operating system Linux in their data centers.

But now there’s a shadow hanging over Linux and other free software, and it’s being cast by Microsoft. The Redmond behemoth asserts that one reason free software is of such high quality is that it violates more than 200 of Microsoft’s patents. And as a mature company facing unfavorable market trends and fearsome competitors like Google, Microsoft is pulling no punches: It wants royalties. If the company gets its way, free software won’t be free anymore.

The free world appears to be uncowed by Microsoft’s claims. Its master legal strategist is Eben Moglen, longtime counsel to the Free Software Foundation and the head of the Software Freedom Law Center, which counsels FOSS projects on how to protect themselves from patent aggression. (He’s also a professor on leave from Columbia Law School, where he teaches cyberlaw and the history of political economy.)

Moglen contends that software is a mathematical algorithm and, as such, not patentable. (The Supreme Court has never expressly ruled on the question.) In any case, the fact that Microsoft might possess many relevant patents doesn’t impress him. “Numbers aren’t where the action is,” he says. “The action is in very tight qualitative analysis of individual situations.” Patents can be invalidated in court on numerous grounds, he observes. Others can easily be “invented around.” Still others might be valid, yet not infringed under the particular circumstances.

Moglen’s hand got stronger just last month when the Supreme Court stated in a unanimous opinion that patents have been issued too readily for the past two decades, and lots are probably invalid. For a variety of technical reasons, many dispassionate observers suspect that software patents are especially vulnerable to court challenge.

Furthermore, FOSS has powerful corporate patrons and allies. In 2005, six of them – IBM (Charts, Fortune 500), Sony, Philips, Novell, Red Hat (Charts) and NEC – set up the Open Invention Network to acquire a portfolio of patents that might pose problems for companies like Microsoft, which are known to pose a patent threat to Linux.

FOSS developers, who do not have the resources to defend themselves against a Microsoft patent suit, felt safe as long as powerful corporate Linux users shared their cause. But now the big boys could just buy their Linux from a royalty-paying vendor like Novell, getting protection from lawsuits and leaving the little guys to fend for themselves. What the shortsighted corporate types didn’t grasp was that without the little-guy developers there might not be any high-quality FOSS for them to use five years down the road.

Microsoft’s big nightmare: free online apps

Moglen had another card to play. In his view, the fact that Microsoft was selling coupons that customers could trade in for Novell Linux subscriptions meant that Microsoft was now a Linux distributor. And that, as Moglen saw it, meant that Microsoft was itself subject to the terms of the GPL. So he’d write a clause saying, in effect, that if Microsoft continued to issue Novell Linux coupons after the revised GPL took effect, it would be waiving its right to bring patent suits not just against Novell customers, but against all Linux users. “I told Brad,” he recalls, “‘I think you should just walk away from the patent part of the deal now.'”

Smith didn’t, and Moglen kept his promise. On March 28, the Free Software Foundation made public revised GPL provisions, which are expected to take effect in July.

Microsoft and Novell both vow to proceed with their deal as planned. Microsoft claims that its mere distribution of coupons won’t make it subject to the GPL, as Moglen asserts. But even if Microsoft is right about that, there’s no doubt that distributors remain subject to it, and Moglen’s revisions will bar them from trying to strike deals like Novell’s.

That may be bad news for big corporate customers, which, judging from early reports, like the Novell deal. Presumably at least part of its appeal is that it provides peace of mind about Microsoft’s patent claims. In the first six months, such marquee clients as Credit Suisse, Deutsche Bank, AIG Technologies, HSBC, Wal-Mart, Dell and Reed Elsevier have all acquired Novell Linux coupons from Microsoft.

Microsoft had hoped that the Novell deal would become a model it could use to collect patent royalties from other distributors of free software. In that respect, its “bridge” to the free world appears to have failed. That, in turn, seems to have taken us a step closer to patent Armageddon.

“The only real solution that [the free-software] folks have to offer,” Smith says, “is that they first burn down the bridge, and then they burn down the patent system. That to me is not a goal that’s likely to be achieved, and not a goal that should be achieved.”

When it comes to software patents, though, Moglen thinks that’s exactly the goal to be achieved. “The free world says that software is the embodiment of knowledge about technology, which needs to be free in the same way that mathematics is free,” he says. “Everybody is allowed to know as much of it as he wants, regardless of whether he can pay for it, and everybody can contribute and everybody can share.”

In the meantime, with Microsoft seemingly barred from striking pacts with distributors, only one avenue appears open to it: paying more friendly visits to its Fortune 500 customers, seeking direct licenses.

If push comes to shove, would Microsoft sue its customers for royalties, the way the record industry has?

“That’s not a bridge we’ve crossed,” says CEO Ballmer, “and not a bridge I want to cross today on the phone with you.”

I wonder why not, Steve?

UPDATE: Response has been swift and almost unanimously against Microsoft.

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Mary Jo Foley’s reaction over at ZDNet