As the attorney for Linspire, the software company formerly known as Lindows, Daniel R. Harris has an insider's view of the battle between open source and proprietary software forces. In this exclusive interview, Harris discusses why and how Microsoft will use its intellectual property as weapons against Linux and open source software. He also predicts where the next battleground might be. He serves as global head of Intellectual Property...
at Clifford Chance US LLP, the world's largest law firm, in Palo Alto, Calif.
Linspire got $20 million from Microsoft in a settlement after Microsoft sued Linspire for using the Lindows name. Is it unusual for the company being sued in a trademark infringement case to end up with a $20 million settlement?
Daniel R. Harris: Yes, it is. I can't say more about the settlement, due to its terms, which have been published, but it is very, very unusual.
Do you expect to see more legal or legislative efforts -- such as the current SCO suits and the recently-failed anti-file sharing act, Senate Bill S. 2560 -- to limit open source application software's usage and development?
Harris: The battle against open source is going on in several different fronts right now. It's going to continue because I think that there is a driving force behind all of these efforts.
Two of the fronts are copyrights and patents. The SCO Group is proceeding with its copyright infringement suits, in part claiming that they had ownership to the entire core that has become Linux. At the same time you have a patent offensive. There hasn't been any litigation yet. But there are hundreds of patents out there that could be interpreted to cover the Linux kernel. Whether there will be suits filed against Linux vendors and customers remains to be seen.
What's the driving force you just mentioned?
Harris: When you look at where SCO gets its funding, it is no surprise that the single largest licensee from SCO is Microsoft. That is one way that Microsoft has managed to funnel tens of millions of dollars to The SCO Group. Microsoft-friendly companies have invested in SCO. That results in additional fear, uncertainty and doubt against open source and Linux.
In addition, when you look at who has the portfolio and the motivation to file patent litigation against Linux customers and vendors, I think Microsoft is foremost there.
Doesn't IBM hold as many or more patents that might be used against Linux as Microsoft?
Harris: If you added up the total numbers of patents that touched the Linux kernel, IBM would probably have more than anyone. But they have been a huge supporter, and derive a substantial amount of revenue by selling Linux.
Microsoft, on the other hand, sees Linux as its primary competitor. Right now, on the server side, all the vendors are pushing Linux. Given the cost of Microsoft products compared to Linux, Microsoft's only weapon is to spread fear, uncertainty and doubt as to the actual cost of implementing open source products. Of course, that includes the potential costs of getting sued.
If you're an IT manager who goes the Microsoft route, you're not likely to be fired for going in that direction. If you go in the Linux direction, and your company receives threatening letters, or worse, a lawsuit from Microsoft, then you are on much shakier ground.
Are you predicting a barrage of Microsoft patent suits?
Harris: Microsoft is hiring patent lawyers as quickly as it can. They are building a patent portfolio now. In the past, this wasn't really a focus of the company. Microsoft hired Marshall Phelps (as corporate vice president and deputy general counsel, Intellectual Property). He is the former architect of IBM's licensing system, and IBM currently brings in about $2 billion a year with virtually no cost simply by licensing its portfolio.
Microsoft's current focus on patents, licensing and litigation underscores the threat that it is feeling from Linux. When you see accounts lost by Microsoft, those accounts are going to Linux because it is really the only alternative.
Are there particular product areas where Microsoft might feel very threatened these days?
Harris: I think that, as Linspire found out, anyone competing against Microsoft on the client side operating system is going to get a quick retort from Microsoft. That is where Microsoft's core revenue is. Microsoft makes its money on Office and the operating systems, and that is it. Everything else that they do loses money. So, they are going to protect those franchises with everything that they've got.
So, Linspire threatened the Microsoft client operating system, and the trademark issue is where Microsoft countered that threat?
Harris: I think Microsoft saw the trademark as the easiest way to go after Lindows. Now, they are going to look for other avenues, and that may involve patent litigation.
There was a study that showed that of 283 patents that read on the Linux kernel, 27 of those are Microsoft patents. But no one has done the study of how many office suite patents are out there. That's interesting because the alternative to Microsoft Office that seems to be gaining the most right now is open source OpenOffice.org.
I think people in the open source community should be watching what Microsoft does to protect its Office business. It makes sense that the disputes will follow the revenue stream. It's like in the Watergate investigation; the reporters were told to "follow the money." Follow the money, and that is where the disputes are going to lie.