Good Morning, Silicon Valley has some snarky cynicism about the deal today, concluding:

"Every time you see an old Dracula film, the same fool is making a deal with Drac to achieve eternal life, a life you know, as the viewer, is going to be awful and short. 'Don't do it!' you want to shout at the screen, and so it is with this deal between the maker of Windows and the acquirer, as Novell once staked its future on UNIX, of SuSE Linux. I'm not saying Microsoft is evil, only that it makes these interoperability deals to defeat its partner, not to help them. ... Linux may win someday, but Novell will be found dead one morning with mysterious bite marks on its neck."

Novell's market cap before yesterday's bump was $2B. Microsoft's - $282B. If Microsoft wanted Novell dead, it could have bought it out of the coffee fund.

The reality of the situation is that Linux' survival has been decreed by both the computer companies that have gathered around it as a common version of UNIX, and by the wish of the customers, which most certainly want to be sure that Windows is not the only game in town.

Microsoft has accepted this -- a good thing, since it has no choice. Even $282B can't buy what it used to. But Microsoft has another interest -- interoperability. Again, its customers demand that the various applications work together, and that the customers not be caught in any crossfire over IP or in the sniping between incompatible systems. Microsoft also knows that the more aps that run on Windows the more valuable the platform becomes, and the more people will pay for it. It has been hell-bent on inducing more developers to write for Windows, and has taken several recent actions (the 12 Tenets; the Open Specification Promise) to assure partners that it is safe to invest in partnering with MS.

But the open source movement has been largely beyond the possiblity of interoperabilty, primarily because of its origins. The Free Software Foundation, which started the whole thing, is adamantly opposed to making money from software, and is opposed to protecting IP through either licenses or patents.

The movement has gathered other forces -- the aforesaid companies, and developers who want to both write code and make a living, most importantly -- who are not so ideologically pure. They could well be persuaded to work with Microsoft, given compromise. But the anti-IP bias built into the movement at the outset has been thought to prevent cooperation because it prevented any guarantees among the players. Microsoft could not let Windows code be included in open software, nor could a Linux company accept it. Nor could MS use code that was licensed under Linux.

What has happened is that MS and NOVL have found a way to neutralize this problem and still stay within the spirit of the open source community. By using covenants not to sue over patents, not licensing, they avoid the technical legal issues that otherwise prevent cooperation between Novell's Linux (other versions are not in this game) and Microsoft. And, of course, Microsoft has extended the covenants to open source developers working on their own on a non-commercial basis -- another reach-out to this group.

So Microsoft is opening up a whole new world of interoperability for itself, but the door will remain open only as long as NOVL is alive and thriving. And NOVL gets a big boost, too. MS has not said that it will sue any other Linux company that violates its IP rights, and it certainly has shown no inclination to do this with respect to any existing patents. But the agreement contemplates that lots of new IP will be created to foster the interoperability, and I would bet that MS will not be tolerant of any outsiders' efforts to appropriate the new stuff. Nor will NOVL tolerate infringement, because it now has a big selling point with the customers vis-a-vis other Linux providers.

So it is a great deal for both companies, and, I think, for consumers, who are getting out of it exactly what they want. But it works only as long as NOVL thrives.

posted by James DeLong @ 4:15 PM | Software

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