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Critics Question Motives in Microsoft/SCO Deal

Skeptics see licensing agreement with Unix vendor as ploy to curb Linux threat

By Todd R. Weiss
May 26, 2003 12:00 PM ET

Computerworld - The SCO Group Inc. last week followed up its threat of possible legal actions against Linux users by announcing a Unix technology licensing deal with Microsoft Corp. But many users questioned Microsoft's motives, citing its continuing lack of support for Linux.
The financial details of the contract between Microsoft and Lindon, Utah-based SCO weren't disclosed. Microsoft spokesman Mark Martin said the software vendor agreed to the deal after SCO offered it as a way to ensure that Microsoft products are compliant with the intellectual property claims SCO has made on Unix.
"Microsoft has said for a long time that it respects intellectual property," Martin said. He said the licensing agreement "has absolutely nothing to do" with a lawsuit that SCO filed against IBM in March or its assertion this month that corporate Linux users could face legal liabilities for running the open-source operating system .
Conspiracy Theories
For the past four years, Microsoft has offered software called Services for Unix that lets users run Unix applications on Windows-based hardware as part of migration strategies or to improve interoperability. Martin said Services for Unix is just one reason why Microsoft agreed to the licensing deal, which covers all of its products.
But critics of the two companies said it's hard to believe a vendor as powerful as Microsoft would sign an agreement with SCO unless it thought the move would keep Linux from posing a competitive threat.
Microsoft "would love for corporations to believe that they will have to pay big licensing fees to SCO for using Linux," said Scott Davis, chief technology officer at Realty Times, a Dallas-based real estate Web site. "Anyone who can interpret Microsoft's announcement as anything other than a PR ploy needs a serious reality check."
Jeffrey Nicholas, a systems analyst at a large New York financial services firm that he asked not be identified, said he thinks Microsoft wants to help fund SCO's Linux-related legal actions. "The whole thing to me really doesn't smell right," he said. "It seems like it's all just too coincidental."
In a research note, Tony Baer, an analyst at onStrategies in New York, called SCO's actions "the software industry's equivalent of terrorism." Baer said he "can only conclude that the licensing of SCO Unix is Microsoft's strategy to drive a new wedge into the Linux community, a sector whose growth poses a far more formidable threat than the empty roars emanating out of SCO."
The Cendant Hotels division of Parsippany, N.J.-based Cendant Corp. runs about 3,700 servers based on SCO's OpenLinux operating system. David Chugg, senior director of hotelsolutions at the unit, said he initially was worried about what SCO's legal campaign would mean for Cendant Hotels. But he said he was reassured when SCO said it would not target any of its own Linux customers. "Out of all the positions to be in, I think we're in the best one," Chugg said.

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