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SCO's Other Investor: Sun Microsystems
Vicegrip writes "Apparently Sun not only bought extra licenses from SCO, but also obtained the option to buy a nice stake in the company: 'The pact, signed earlier this year, expanded the rights Sun acquired in 1994 to use Unix in its Solaris operating system. But there's more to the relationship: SCO also granted Sun a warrant to buy as many as 210,000 shares of SCO stock at $1.83 per share as part of the licensing deal, according to a regulatory document filed Tuesday.'" A reader points out Ransom Love's 2000 Linuxworld keynote speech.
you should also note that the only reason for the expansion of the license was to allow sun to do intel hardware drivers under Solaris..soemthing they could have adpoted from Linux without any costs what so ever..
Don't Tread on OpenSource
If SCO wins, and their shares skyrocket, Sun can still buy at $1.83. If they don't win? Well, no sweat off Sun's back - the deal was done in the past and is a sunk cost. I'd love to be in that spot.
Although Sun has broader rights than do other Unix licensees such as IBM and Hewlett-Packard, it doesn't have the right to release Unix source code or Sun modifications to it as open-source software, SCO spokesman Blake Stowell said.
... so *you* did, and, apparently well, you *did*. Therefore, you should just shut up now. M'kay?
Yeah...but...*flashback to Linuxworld 2000*
But clearly we are going to add components back to the Linux kernel on both IA-32 and IA-64 platforms. We'll work with Linus and everyone in order to make that available.
Thank you.
My journal has hot
Reading the article it seemed that this was primarily a purchase of code.
Sun purchased drivers and other stuff to use in its i86 version of Solaris, along with the rights to show that code to others.
As for the stock options; SCO probably needed the cash, Solaris had the cash so the directors of Sun decided to gamble. Solaris gets options for a price, and if SCO does good they stand to make a really nice profit. SCO gets some additional cash and has a little protection from Solaris since any action by Sun has to include potential profits from using the stock options.
Sun has been facing a dilemma for some time now. Originally a high-tier supplier, they're getting pushed down the chain. Once upon a time, they were an excellent choice for network infrastructure and servers. But now?
Even the largest companies who need big iron systems rarely go to Sun anymore. Google has shown that even using thousands of 'white boxes' works, and Apple, Microsoft, and even IBM have been muscling in on Sun's traditional market. The dot com days were great for Sun, but now they're left as a giant church without any congregation.
So Sun needs a way to exercise its muscle once again, and with its recent tie up with Oracle, it's starting to do this (albeit with help). If Sun can carve out a significant role in the SCO case, it could certainly cash in from the exposure, and any potential win for SCO.
Of course, I don't think SCO stands a chance, and that we're going to see traditional UNIX crash down around itself. Sun has always been a company that intrigues me in the amazing way it runs 'behind the scenes' (the 'Sun Library' is amazing! and their usability work is delightful).. but on the front end, they're sucking big time, IMHO, and I think they could be one of the next big technology fallers.
Um...
SCO price as of this moment: $11.16.
Warrant price: $1.86.
Current profit: $9.3/share x 210,000 shares = $1,953,000.
Obviously it depends on the specific terms of the trade, such as when they are allowed to actually purchase the shares, any limitations on selling, etc. Still, a couple million in profit doesn't sound bad to me, and probably doesn't sound bad to Sun either.
If Sun was smart, they'd buy then sell as quickly as possible. Who knows how long SCO can keep the FUD train rolling?
The enemies of Democracy are
My company got the same letter suggesting that we move from AIX to Solaris over concerns with the AIX license status. My boss showed me the letter and asked what I thought because I work in IT. After I controlled my laughing, I told him to ignore it and make sure that we do not ever buy anything from Sun (not that we ever have).
I hope the people at Sun realize that they are just going to piss IT people off more and more. This thinly-disguised "licensing" agreement with SCO will not win them any new friends even if Sun's intentions are good and they want to expand Solaris on x86. I think the Sun will be setting (pun intended!)
1. SCO could be picked up by Sun, since the latter has a better image in the market. That could give a boost to the battered image of SCO.
2. More and more, there seems to be some Coke-Pepsi posturing, with MS and Windows pitted against Sun& Unix. Linux is too well entrenched for such a thing to work.
3. All the firms who've picked up a stake so far in the Unix code patent have been American firms. This could be the beginning of some polarisation, where all important IP is within the US. This could have serious repercussions for firms like Fujitsu, Siemens etc. who aren't based in the US.
The saving grace: Any number of firms (SCO, Sun etc.) haven't managed to achieve a small fraction of the success which Linux has done - on the Intel platform. It appears too late now for anyone to rollback on the spectacular progress made by Linux.
If Sun does indeed pick up stakes in SCO, they'd be hated more than Microsoft - if ever that would be possible.
If you keep throwing chairs, one day you'll break windows....
Yeah because that much money (210,000 shares * $2 share = $384,300) is really going to make or break Sun. Uh-huh.
... if SCO wins then their stock will go up though not near 1,000x what it is now ... and if they lose Sun doesn't have to buy the shares).
Look, even if shares of SCO went up by -one thousand times- their current value, Sun would only make $384,300,000. That is 2.3% of Sun's current market capitalization. As it is now, even if they buy and lose that money it is barely a dent in their quarterly operating budget.
Yes, I work for Sun. Yes, I think this stock deal is a tiny bit of a black mark in terms of supporting the Linux community (but not in a financial sense
But seriously, the math is simple and available to anyone looking at it. This should not be a big deal. If Sun has options to buy 12,900,000 more shares of SCOX (the total outstanding), -then- I would worry about Sun's intent here.
It is more productive to voice thoughtful opinions (reply) than to judge (moderate) others.
I'd really like to know how SCO continues to distribute the kernel source GPL and all, and claim that code isn't covered by the GPL.
If I were a CIO or CTO debating the TCO of *nix vs. Win2K3 to a CEO, would IBM vs. SCO be the TKO that stops the CEO from approving A/P to pay my PO for RH's LGX?
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FWIW, even if OSS is FAIB, if the DOJ considers *nix IP with a TM, then it basically become's SCO's LIC, meaning our OSS becomes a CSS OS, which would RSTBO.
AIBO going w/ an ASP that manages our OS? BTA, we might end up w/ a BOFH giving us ZA, which WWAD PMS.
AFAIK, INMP if SCO wants to be ITM by enforcing its supposed IPR - *nix IP should be PD or GNU, like BSD just on GP, IYKWIM. I keep asking myself in this situation - WWLD?
Oh, BTW - IITYWIMWYBMAD?
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balls to the original:
http://slashdot.org/comments.pl?sid=68
You have to be careful with options. You could exercise them and realize a taxable gain of $2million but still be under contract not to sell the stock for quite a while. During that time the price could go down significantly until you actually owe more in taxes than the stock is worth. Its less of a no brainer than it may seem at first glance.
I'm sure some people on this board can comment on how they may have learned this lesson.
Most employee stock options allow you to sell the stock immediately upon exercising the option. I would recommend selling at least enough stock to cover the tax burden immediately just to eliminate the tax risk from your portfolio.
t
I'm guessing this is why Sun hasn't been advertising the fact that they are supporting SCO. They licensed the code back in February and we just learned about it from SCO regulatory filings. Remember, February was before SCO started making all of the crazy accusations against Linux (all your code belong to...). Sun doesn't want to be associated with SCO but wants to profit from the FUD. Of course, it was bound to come out sooner or later. The backlash will be interesting to watch.
When you lose something irreplaceable, you don't mourn for the thing you lost, you mourn for yourself. - Harpo Marx
Clearly, Sun is on our side.
Consider that Sun bought a 300K$ license in Feb, a month or more before SCO publicly went after IBM. Sun may be entirely innocent of anti-Linux actions. Or even intent.
300K$ is chump change in corporate circles. That's less than the cost of 2 programmers for a year.
If they got options that are now worth 2 million in the process, I'd say they are good businessfolk.
I used to work for Sun. Loved the company, loved what they stood for, felt like I should have been paying them for the privilege of coming to work every day. Truly my dream job. I'm a major Linux bigot, but that didn't stop me from loving Solaris and loving Sun.
5 years later, the bloom pretty much faded from the rose. Sun made a lot of stupid decisions and strictly in my *opinion* started behaving unethically. They began to reap what they sowed, and the current sad state of affairs at SUNW is a reflection of their abandonment of core Sun ideals. I don't think it's wrong to use ethics as a measuring stick for your business decisions, but I seemed to be in the minority.
I think this SCO deal is a reflection of the 'new Sun' and an example of everything that is wrong with the company currently. I mourn the loss of the old Sun, and I mourn the impending death of a giant, for I truly believe that Sun is destined for failure if they continue along the current path.
I used to respect and admire Scott McNealy for his willingness to take a stand and fight for what he thought was right, but somehow along the way Sun leadership no longer does this... they instead hedge their bets, play both sides of the fence, and refuse to stick to their guns on anything when push comes to shove.
I was one of the many thousands of engineers who got laid off from Sun in the last few years. I did well while I was there, did everything that I thought was humanly possible to ensure Sun's success despite the odds, and I'm sorry to see them fall. I still truly believe that Sun has the potential to regain their dominance in both the market and mindshare, but unfortunately they got rid of all the people who had the intestinal fortitude to make a stand for what they believe in instead of what was politically expedient.
Sun hardware kicks ass, plain and simple. Solaris is a damned good OS, but no longer the far and away market leader that it used to be. Can it be again? Who knows... I believe that it could given the right attitude and resources but again, that's just a personal opinion. I think Sun could do extremely well partnered with the Linux community (like IBM is doing) instead of being an adversary to it.
Am I bitter? I'm not bitter about losing my job to economic forces, and I'm not angry towards Sun, nor do I wish them failure. I truly enjoyed working there and would work there again if I felt that they were willing to commit to what it takes to succeed. I'd work until my fingernails bled to help them achieve that, but I don't see them even acknowledging the issues and problems they face, let alone actively striving to correct them. I don't think that makes me bitter, only honest.
I only hope that Sun some day wakes up, yanks back on the control yoke and comes out of their tailspin before it's too late. Things like this SCO business aren't helping them at all and they are too shortsighted and stubborn to admit it.
-- Gary F. (who refuses to post as an AC)
I don't think so. You can distribute any GPL product with your OS without making it open.
They would have to make public the modifications they did on the driver itself to integrate it to the kernel, but not the kernel itself!
Write boring code, not shiny code!