Gartner Recommends Holding Onto The SCO Money

benploni writes "George Weiss of Gartner has published a paper with some interesting recommendations regarding SCO. They include 1) Keep a low profile and do not divulge details on Linux deployments. 2) Until a judgment in a case would unequivocally warrant it, Linux users should not pay SCO the license fees it has asked for to settle its allegations of infringement of intellectual property rights. 3) Do not permit SCO to audit your premises without legal authorization. 4) For customers of SCO Open Server and UnixWare, an unfavorable judgment could cause SCO to cease operations or sell itself. That could harm future support and maintenance. Just in case, prepare a plan for migrating to another platform within two years. There's more, but are the analysts finally catching on?"

Comments

Red Herrings Eat Profits

[dolo666]

"Just in case, prepare a plan for migrating to another platform within two years."

Maybe once the plans to migrate are prepared fully, smart employees will push for migration citing the existing contingency plans as existing (hey, we planned to move in 2003), and show how cheaper/better life could be without the SCO. At least with that plan, even the most obtuse managers would see the truth.

Funny how the legal fees of a legal aggressor company like SCO prove that overextending yourself is a bad business model. They're like Rome! But at least they are setting the bad example, so that other businesses with money won't dare go after the Open Source community so readily next time around. I say it looks like we are proving ourselves to the traditional red herring pundits.

IANAL, but wouldn't it be wise for everyone to just wait out the SCO? They are doing their damndest to ruin their own business reputation, so the rest isn't far off anyway. I mean it's obvious, right?

Re:Red Herrings Eat Profits

[EvilTwinSkippy]

Remember though, we had a few 800 pound gorillas in the form of IBM and Novell.

Far more Earth shattering was the USL vs. BSD lawsuit. BSD went from being on the ropes to routing USL badly. Rumors are that part of the sealed evidence showed the much of Unix was actually lifted from BSD. Especially impressive because it was pretty much Berkley defending itself. There were no industry players coming to bat.

Re:Red Herrings Eat Profits

[jimfrost]

Rumors are that part of the sealed evidence showed the much of Unix was actually lifted from BSD.

I think the quote was, "as much as 50%." There is a hell of a lot of BSD in SVR4. That certainly seems to have pushed them to a fast settlement (and they got off cheap!) but there were a variety of other things that probably would have shot them down too -- many of which are still going to be true in a case against Linux.

One of the primary issues, not decided by the judge but hinted strongly at, is that 32V may actually be in the public domain. In that light the decision to put it out under a BSD license was a kind of damage control; if it's out under a loose license then most likely no one will test the validity of the original copyright in court.

This case may well reopen that can of worms seeing as the only case of obvious copying they've pointed out is rooted in 32V.

I rather hope that IBM is doing/has done its own code commonality inspections because it seems highly likely that there is GPLed code in SCO's product (that's the easy way to compatibility you know). If so that would tarnish their case badly, although it's not very likely to be as damning as it was in the BSD case.

One of the things I find most amusing about their claims of open source being lax on IP protection is that it's been my experience that code pilfering is quite common in closed source projects. Certainly we know it happened at least twice in the history of SysV -- once wholesale in SVR4, and again in R5. And I would suspect it happened again when Caldera implemented Linux compatibility.

I kind of hope IBM or some other SCO source licensee does their own code analysis. My bet is that there are many more lines of code pilfered from open source in SCO stuff than vice versa. SCO is really only getting huge infringement numbers by counting whole subsystems as infringing, using theories of "derivative" that are unlikely to hold up.

Go take a look at the BSD lawsuit papers (various links posted around the net). The judge's opinion where he denied the preliminary injunction against BSDI is really quite remarkable.

Now that's a U-Turn

[Space cowboy]

... complete with handbrake squeals. Is it just me, or does Gartner appear to just write what they think will go down well, rather than really analyse things.

Of course, we like it when it agrees with what we think (and I think they're right to say what they're saying now, but that just makes me no different from (m)any of you reading this :-)

Simon

Crying in his Jello

[BubbaTheBarbarian]

Remember Rambus v. World? The same thing happened to them. They tried to sue the world, and lost. In middle of it, Gartner said basically the same thing.

This is a HUGE blow to SCO, to have as respected a group as Gartner say these things about the case. They have basically had all of what they have done over the past 6 months ripped out. No one will pay them for nothing, and even worse, they now have the real possibility of losing alot of their current customers.

Is this why IBM has been so quiet?

Duhryl must be crying in his Jello salad today.

Thank you for comming! See you in hell!

(this post not worth spell checking)

Gartner borrowing from the Slashdotter playbook

[azaris]

prepare plans to migrate...

Is this Gartner's answer to everything?

MS software insecure - prepare to migrate.

Sun changing licensing terms - prepare to migrate.

SCO threatens Linux users - prepare to migrate.

I've used to seeing "switch to another platform/software package" as the default answer on Slashdot to most articles about potential problems any piece of software in existence, but some people actually pay for these Gartner analyses.

When are people who constantly advocate jumping ship whenever a potential problem appears with a product your relying on in you're business going to stop breathing since you can potentially be poisoned by air-borne pollution?

Re:BSD was in SCO UNIX?

[dougmc]

... to port the NetBSD USB stack to osr5! They sure don't mind stealing open source when it suites them!

To be fair, the BSD license permits this. Is it really stealing if you accept something that somebody else gives you?

(Also, Microsoft has been accused of the same thing -- using *BSD code in their products. And as far as I can tell, this accusation is completely true -- but irrelevant, because it's not illegal or even `wrong'.)

I've always wondered why people who make embedded devices like WAPs and the like chose Linux rather than *BSD -- with BSD they don't have the GPL requirements to open up the source. If you intend to give out the source, fine -- use Linux -- but if you don't, it seems to be that one of the BSDs would be a better choice.

"software company"

[siskbc]

But what I can't figure out is why they think SCO is a software company . . .

Analysts are required to maintain some degree of objectivity and avoid controversial statements. That said, if you read between the lines, he basically said just what we've all been saying.

From Gartner:

We believe that these moves compromise SCO's mission as a software company.

If he thought SCO was still a software company, he would have said "We believe that these moves compromise SCO's ability to remain profitable." He's stating, quite clearly, that because these moves make it impossible to remain profitable as a software company, they only make sense for SCO as a litigation manufacturing company. In other words, they're changing their "mission," as he puts it.

He can't say that SCO are a bunch of litigation-happy jackasses that deserve to be sued into the stone age (at least in print). But he can, and did, say things that readers can translate as such.

All in all, it sounds like he completely gets it, if you read between the lines a tad.

Re:"software company"

[Artifakt]

This is a great example of how to read an analysis. Anyone who invests in the market needs to know this sort of thing before they get in over their heads. Good, professional people, knowing that their words can have an impact beyond their face value, will be careful to say only what they can back up. Your 'warning' that the stock's a turkey is never going to be a simple "Don't buy this Turkey!".
About the clearest I've seen was "While X claims to have resolved all major old contract disputes, the state wherein X is incorporated allows a full year for filing appeals." (Meaning they have been in court a lot in just the last fiscal year, and It looks like there's a good chance things aren't as resolved as they say. If you don't have the sense to check in detail to see just what the company considers a "minor" dispute, and whether any of the "major" ones ARE filing an appeal, you should not invest in stocks.) Most warning signs are subtler than that example.

What did they intend vs what they are doing.

[khasim]

Background:
SCO hasn't had a new release in years and they are still years behind on 64-bit.

SCO's business is dead. New deployments are going to Linux or Microsoft or Sun.

My guess is that this was ORIGINALLY an attempt to get IBM to buy them out and shut them up.

But SCO messed that up so badly that IBM decided to face them in court.

So, the SCO execs have a failed company and not much hope for an easy buy out.

So the decided to pump-n-dump their stock. That way they can realize SOME profit.

So SCO goes public with all sorts of claims, people seem willing to buy SCO stock on the "lottery" principle.

SCO execs dump their stock as fast as they can. That's on the record.

But the SEC doesn't like pump-n-dump schemes.

SCO has to do something so the SEC doesn't start digging.

So now you have SCO making strange claim after strange claim after even stranger claims.

That's why SCO is taking venture capital funding for stock.

That's why SCO is paying their lawyers in stock.

All they have to pay for the things they need is stock.

So they have to keep the stock price up.

But repeating the same claims over and over has a diminishing rate of return. People don't buy your stock in 4th quarter if you keep repeating the claims you made in 2nd quarter.

You need new claims. Something to fire the imagination. Something to get those "journalists" calling you again and printing your words.

Something like ....... announcing ANOTHER lawsuit.

But don't actually file one. SCO cannot afford to split their legal department.

Just threaten to file one. That's just as good for those "journalists".

Re:BSD was in SCO UNIX?

[KrispyKringle]

I had the fortune to hear the CTO of RedHat give a speech. Afterwords, over refreshments (mmm...donuts), I asked him about this. `Why isn't it RedHat BSD?'

He said partly it was historical accident, but that there is also a good reason. He said something like, `Well, look at it this way. IBM recently pledged $1,000,000 to Linux (though where that money is I can't say). With Linux, we know that whatever they put into it will come back out. But if it were BSD, nothing would stop IBM from putting that money into BSD and making ``BSD+'' and not releasing the code. Here, we know we can benefit from what others put in without them closing it off.' I had to admit this was a pretty good point. To guys like you and me, it seems as if the companies get nothing out of it. But to the companies, the hard work of independent developers is just as important as their hard work is to us.

consulting on migration

[decapentaplegic]

So is anyone starting up companies that specifically do consulting on how to migrate away from SCO?

One of the open source mantras is that the profit isn't in the code itself, it's in consulting, customizing and tech support. So this one seems like a no brainer. Get a bunch of specialists who understand what keeps SCO's current customers in the SCO fold. Put together specific GNU/Linux packages to match those needs and sell "migration consulting services". Best of all, one could write 2 tier contracts. One tier is just a migration plan analysis. The second centers around the work to be done to implement it if (sorry, when) SCO implodes.

This seems like a business model with considerably better fundatmentals than selling 50lb bags of dogfood over the internet.

Plus doing the sales calls could be fun: "Your chief technology supplier currently has a market cap of X million dollars. They are in a legal fight with IBM, which has a market cap of Y billion dollars. IBM has stated that they have no plan to settle before the damage wrought by their lawyers can be seen from orbit. For Z hundred thousand dollars we can show you how to not be collateral damage."

Re:Slow learners

[fermion]

It should be obvious not to pay invoices when no product or service has been requested, and not to allow searches unless legally required, but look at the recent reality. Customers are increasingly caving in to increasingly intrusive demands, and vendors are asking for powers once reserved for federal law enforcement. MS wants to compel customers to upgrade on a yearly basis or pay large fees as punishment. Music labels want the ability to destroy physical property on the suspicion of civil violations of their rights. I think in this reality it is quite necessary for a firm with some merit to come out say just don't do it.