Microsoft's US$536 million settlement with rival Novell is certain to raise eyebrows, as the agreement is another in a closely packed string of settlements that the software giant has reached with opposing litigants in the past year. In dispatching so many suits in such a short period of time for a breathtaking sum of money, the company has taken a significant number of items off the to-do lists of its attorneys and executives. The comprehensiveness of its legal deck clearing begs the question of whether Microsoft needed to free up bandwidth for forthcoming legal offensives of its own. Is Microsoft telegraphing its plans?
Including this week's settlement -- related to Microsoft's business practices and Novell's NetWare operating system -- Redmond has settled with no fewer than seven existing or potential litigants (and probably more that we don't know about) for a mind-numbing US$3.77 billion over the last 12 months. Just to put that in perspective, if Microsoft was a nation with a 2003 GDP of US$3.77 billion, its rank would be 159th in the world, right after Barbados (US$4 billion) and Burundi (US$3.8 billion), and just ahead of Guadeloupe, Liberia, Guam, Sierra Leone, Virgin Islands and Bermuda.
Faced with certain defeat in a patent infringement suit back in December 2003, Microsoft paid US$60 million to whiteboard technology provider SPX. Earlier this year, Microsoft got Sun off its legal back when it inked a watershed agreement that included a US$1.95 billion payment to the Silicon Valley company. One week later, Microsoft ironed out its differences with digital rights management solution provider InterTrust for US$440 million. Then, in May, Microsoft put to rest its legal disputes with AOL Time Warner and Opera by agreeing to pay those companies US$750 million and US$12 million, respectively. After that came a US$20 million dollar settlement with upstart Linux seller Lindows. And now comes a cool US$536 million to Novell. (While the companies settled one suit, Novell announced plans to file an additional antitrust claim against Microsoft before the end of this week).
Microsoft has other outstanding legal challenges, including the US$1 billion antitrust suit filed by RealNetworks last year; its ongoing deliberations with the European Union, the newly announced suit from Novell, and, according to Microsoft spokesperson Jim Desler, at least 30 other patent infringement suits against the company. Still, one can't help but marvel at the number of suits recently settled, the sum of money that those settlements involved, and the compressed timeframe over which these resolutions took place.
Noting that the settlement with Novell happened before the two companies entered into litigation, and also noting that Microsoft's antitrust deliberations with the CCIA weren't that consuming but had the potential to be should they have escalated to the Supreme Court, Desler acknowledged that lawsuits can consume not just significant legal resources, but also the time of executives and employees who have to testify or give depositions. In that context, Microsoft's blindingly fast and expensive elimination of seven whoppers could be seen as a bit of legal deck clearing for future matters.
What could those matters be?
4%
4%
What do you mean "What could those matters be?"..
It's obvious...Microsoft is scared of Linux, especially now that Linux is poised to leap out of the server room onto the workstation.
Microsoft and its shills (SCO and maybe SUN) will be gearing up for a big IP war to try and FUD linux out of the boardroom.
Of course they'll be up against IBM and Novell who have both pledged to use their own huge IP portfolios in defence of Linux against Microsofts dirty tricks campaigns.
I think the recent announcement by Microsoft that it will "indemnify" its users against any potential IP liabilities is the first shot in this war. Lets face it, what would you call "indemnifying" your own customers against a totally non-existant threat to spread the FUD around re: linux ?
1: First they ignore you
2: then they laugh at you
3: then they fight you
4: then you win.
Linux is at "3" now.