CyberTech Rambler

November 30, 2010

Novell, Attachment, Microsoft … and SCO

Filed under: Uncategorized — ctrambler @ 6:00 pm

I am sure everyone now knows that Novell sold itself to Attachmate. A lot of digital ink has been spent commenting on the issues. To me, the interesting bit is how and why Microsoft financed the sale by creating a patent holding  company to buy Novell’s patent portfolio concurrent with the sale and the part about Novell retaining Unix Copyright.

Andy Updegrove’s excellent analysis about the deal is here and here.  I thought Microsoft could buy up Novell. However, it appears that if it does so, there may be antitrust problem. I think Microsoft ego might be part of the  consideration but Microsoft’s history has shown that it is a truly American company (in a sense that I always admire) that will swallow its pride if it is necessary.  I am sure it also felt that it has to protect Intellectual Properties that was created by the much-criticized MS-Novell deal. If a outright buy is not possible, then a holding company strongly controlled by Microsoft is the next best deal.

I think the mail goal of the holding company to Microsoft is to protect the IPs mentioned in the previous paragraph. The icing is of course the ability to continue the rant that Linux infringe MS’ IPs. If MS controls who can join the holding company as members who are covered by patent held by the company, it will be as good as MS holding the patent themselves. However, as Updegrove correctly point out, this simply mean MS squeeze slightly more patent fee out from licensees so no big deal there. I, however, think he missed a trick. As he had pointed out, it is difficult to pinpoint who are members of the holding company. By becoming a member of the holding company, any Linux-based product vendor workaround the publicity they don’t want if they had publicly signed an agreement with Microsoft. You and I know that Microsoft will not sue members of the holding company and in fact, your membership fee is inflated by this implied benefit.

Novell is at pain to point out that Unix Copyright is not part of the sale to the holding company. That tells me one thing: It is not worth much and only SCO sees  value in Unix copyright. Not even Microsoft sees benefit of holding Unix copyright through a proxy. It is therefore a pity that SCO is in bankruptcy. A few years ago Novell might be able to make more money by selling those copyrights to SCO.

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