Itís Hacker vs. Hacker in EU Anti-Trust Case

Why we need "suits" in IT
There is a reason that the 'suits' and not the scientists have always run IBM. Letting scientists run things is bad for users and investors. It's not just an information technology (IT) phenomenon although DEC, Data General, and Wang are examples. Their founders, the hackers of their day, refused to compromise on legal and marketing issues that eventually doomed their companies. Thomas Edison, the hacker of all hackers, famously refused to compromise his preference for direct-current (DC) electricity distribution in favor of alternating current (AC), reportedly arranging to electrocute many cats, cows, dogs, and horses to prove his point.

There is no need to go back 30 or 120 years for proof. The phenomenon of no compromise among hackers continues between parts of the open source software (OSS) community and Microsoft over client/server (C/S) interoperability. The latest battleground involves the European Union's (EU's) 2004 anti-trust findings against Microsoft, which was upheld on September 17, 2007 by the EU's Court of First Instance (CFI). 'Suits' simply would not have let this side show go on this long.

(Note: I use the term "side show" because the EU investigation and court case discussed here has other aspects, most notably the bundling of Window Media Player. This article is only about C/S interoperability.)

In 1998, Sun asked Microsoft for protocol information to allow Solaris servers to work with Windows clients. Microsoft said, "Sure, come to TechEd." That was also Microsoft's initial legal defense two years later after an EU Competition Commission (EU CC) anti-trust investigation began. Sun's request, according to the EU CC, could be summarized as "We want a Solaris server to interact with Windows clients in a workgroup exactly the same way a Windows server does." It boils down to interfacing the server message block (SMB). As a result there have been $10s of millions in attorney fees and EU bureaucrat time spent on NetBIOSs and NetBEUIs, named pipes, inter-process communications, remote procedure calls, sockets and a lot of other artefacts out of the mists of the beginnings of IT.

In April 2004 the EU CC ruled that Microsoft had to provide "complete and accurate interface information which would allow rival vendors to interoperate with Windows, and to make that information available on reasonable and non-discriminatory terms." This was pretty bland stuff, nothing like the U.S. Department of Justice (DOJ) forcing IBM to unbundle in the 1970s. 'Suits' would most likely not even have appealed. But Microsoft did. Even if the suits had appealed, they certainly would have settled up when Microsoft couldn't get an EU court to issue a stay on the EU CC ruling. Without a stay, Microsoft had to begin implementing what it calls the Workgroup Server Protocol Program (WSPP) even as appeals continued. Any 'suit' would have realized that it would be expensive and a burden on users to reverse course once the WSPP began.

In addition, of course, Sun's 'suits' had settled up with Microsoft's by 2004 as have Novell's and many others' since then.

Looking to 'suits' for a little sanity
To try to get some sane suit-like answers, I went to two of the lawyers involved: Carlo Piana and Mark Webbink. Piana, of Tamos Piana of Milan, is the attorney in this case for the Free Software Foundation Europe (FSFE) and the Samba community. Carlo also represents in Europe. Mark Webbink is now special counsel to Red Hat, which is an intervenor in the remedies process that has followed the EU CC's 2004 ruling. At the time of the original investigation of Sun's complaint by the EU CC, Webbink was Red Hat's deputy counsel and chairman of the Software & Information Industry Association (SIAA), another intervenor opposed to Microsoft.

I interviewed the pair via email and/or phone so I do not know if they were wearing suits. I do know that their answers were reasoned although of course impassioned in favor of their clients. But there are no 'suits' among their clients and few at Microsoft. That is what the OSS community does not understand about Microsoft. Microsoft is run by hackers like them, not 'suits." This controversy is "the hackers do Braveheart." No quarter has been asked and none will be given. This is not about technology or interoperability. This is "for Scotland."

Part of the problem is that the EU process is unbelievably drawn out. With findings overlapping appeals, overlapping the already working WSPP process, overlapping remedy orders and appeals of the remedy orders, all parties are constantly fighting the next battle.

  • The EU CC spent most of 2004 setting up a process for compliance.
  • In 2005, after its stay request was denied, Microsoft turned over 12,000 pages of interface documentation, about 500 pages per protocol (many of which were already "open" in the 1970s academic sense of that word).
  • In June 2005, the EU CC basically said that submitting 12,000 pages was being too complete and ruled Microsoft "not in compliance" with its 2004 order.
  • In January 2006, Microsoft rolled out the WSPP and by the summer of 2006, Microsoft had re-submitted the documentation in a newly requested format; protocol page count was down to 8000.
  • That documentation was made available for everyone on Thanksgiving 2006.
  • Then in March 2007, the EU CC decided, irrespective of completeness and accuracy (still no decision), the terms and conditions (T's&C's) Microsoft was offering in the WPSS were not reasonable and non-discriminatory.

The suits care about the issues
Mark Webbink summarizes the current status as one where the OSS community continues to have "to encourage the commission not to waver to ensure there are remedies not just for proprietary companies but also for OSS companies." Red Hat put out a press release to that effect a day after the CFI ruling, after first putting out a press release congratulating the EU CC.

The FSFE's Carlo Piana says Microsoft should "not exclude those who compete" with it. He feels Samba is the only competitor that is presently excluded. Piana says "it is evident" from reading the WSPP licensing agreement that there are "countless incompatible conditions" being thrown in the OSS community's face. He also makes it clear that by the term "Samba community," he means "IBM, Red Hat, Novell, Sun, Apple and a full host of network appliances manufacturers," all inextricably linked in the community. Webbink agreed that there really aren't many non-OSS companies any more, with the exception of Microsoft (which will, of course, argue that point too).

With better documentation from Microsoft, Piana feels, the Samba community could invest more time to write code and innovate, rather than chasing all of the small changes in protocols. He says "Things can be changed very easily on Microsoft's part, and it can take ten or twenty times as long to work the change out on Samba's side. This guessing game means a lot of wasted time of incredibly talented engineers." Changing things sounds like good old hacking fun but legally it is probably discriminatory on Microsoft's part.

Webbink notes that that process is "not totally in (the EU CC's) control" because the CFI took note of Microsoft's claim that the EU CC was effectively asking it to "open source" its protocols and said that the EU CC could not "ignore intellectual property (IP) rights." Perhaps IP is the crux of the matter. As part of the appeals and remedies process, Microsoft began asserting IP rights (patents on its protocols). The "come to TechEd" defense changed as the process extended. Webbink says, if a party (Microsoft) is "going to assert IP rights, it has to substantiate the application of those IP rights to the relevant protocols and be able to substantiate the claims that (the protocols) are innovative."

As for the T's&C's Piana conceptually agrees with the lump-sum option the WPSS provides for license payment. But, according to its web site, Microsoft will only license some of its interoperability protocols for a lump sum. For others Microsoft wants a per-server fee and this is an "example of (an) incompatible licensing condition," according to Piana. Piana also asks "What is the appropriate level for the lump-sum, if any?" The EU CC has ruled that the value must not take into account the competitive effect of the refusal to release it, because this is the abuse of which the EU CC has found Microsoft guilty.

The Microsoft WSPP license has many provisions that block Red Hat and other Samba users but not "Adobe," SAP and other "non-OSS" software suppliers" from bringing related products to market, according to Webbink. In a way the OSS community appears to be a victim of some of its own intrigue. One of the specific clauses of the Microsoft WSPP license that the OSS community objects to most strongly sounds eerily similar to the catch-22 in the GNU General Purpose License version 3 (GPL v3) wording.

  • Among other things, GPLv3 basically said if a "user receives a discriminatory patent promise from Microsoft as a result of purchasing a copy of a GPLv3 program from a Microsoft fulfillment agent, Microsoft would be bound by GPLv3 to extend that same promise of safety to all downstream users of that software."
  • The Microsoft WPSS license says "The licenses granted … do not include any … authority to... (incorporate) any of the terms of any license that requires terms or conditions that are contrary to the scope of this Agreement or Licensee obligations under this Agreement."

Hackers have other agendas
Although the IP and T's&C's issue might be the lawyers' areas of expertise, licensing and other things like bidirectional collaboration are closer to the OSS community's heart. Microsoft would probably reply that all licensees have to do is pay the fee and observe the distribution limitation. In fact Microsoft says that it will negotiate about anything in the WPSS with anyone. And Webbink says he has negotiated other Red Hat issues with Microsoft. It appears OSS developers can build implementations of Microsoft's protocols as a non-GPL layer on top of Linux or other GPL code if they want to.

It seems reasonable that Microsoft does not want its software distributed under a so-called OSS license. But reasonable is not part of this dispute. Piana says, "We have seen already a great deal of changes in Longhorn and SMB2. It is a moving target." That is not surprising because the new Microsoft server operating software has not been introduced. Piana wants a sound implementation of the EU CC decision that makes sure that future Longhorn/SMB2 changes are done only for technical, as opposed as tactical, reasons, and will provide enough time for the OSS community "to cope with those changes."

And no one else other than the "combatants" really seems to care about this side show. The U.S. DOJ has criticized the EU CC for the overall decision, saying it, the DOJ "protects consumers but not competitors." And U.S. taxpayers' organizations have criticized the EU CC decision and subsequent CFI ruling because of the likelihood that it will drive up the costs of IT for government.

Even on the OSS community side, the criticism is more big picture than related to the interoperability specifics. The Linux Foundation's Amanda McPherson said via email "For instance, the Samba team has not been given the access they would like to make their product truly work with Microsoft products." But why should Microsoft's hackers care what Samba's hackers would "like?" The Free Software Foundation's American office, which appears autonomous from FSFE to some extent, had what was probably the most honest of the OSS community's reaction when it said via email: "Microsoft's monopoly status is not the problem here. The type of dependency and lock-in they cultivate is intrinsic to proprietary software, and the only way to escape it once and for all is to move toward free "as in freedom" software." Whether you agree or disagree with the FSF's ideology, it stays on message consistently.

At this point, Microsoft has three interoperability-related issues still on the table:

  • Its possible appeal of the CFI ruling to the EU's equivalent of the U.S. Supreme Court (Microsoft must decide by November 2007).
  • Another EU CC ruling on the still open issue of documentation completeness and accuracy.
  • Another EU CC ruling on the T's&C's, which Microsoft modified again on September 4, 2007.

Either of the latter points can then be appealed. The battles continue and you get the feeling none of the parties want them to end. Microsoft has tried to move the goal posts by introducing patent protection issues, the EU CC has tried to move the goal posts in terms of new conditions (e.g., a concept called "a high level of interoperability") that were not part of the 2004 ruling, and the OSS community has tried to move the goal posts to the extent it has incorporated the GPL v3 into the case.

About the Author

Dennis Byron brings three decades of analyst experience to his role as ebizQ's Community Manager for Improving Business Processes. This community covers Business Process Management (BPM), Process Modeling, Process Analysis, and Business Alert Monitoring (BAM), among other topics.

As Community Manager, Byron will blog and podcast to keep the ebizQ community fully informed on the latest news and breakthroughs relevant to enterprise BPM. Byron will be responsible for bringing you breaking news on BPM daily, writing feature articles and sourcing content from other analysts, industry associations and vendors for publication on ebizQ. Finally, each week, Byron will compile the most important news and views in an e-mail newsletter for ebizQ's ever-growing BPM community.

Byron is ideally suited to the job, as he has researched and analyzed all areas of IT and information-systems use for the past 30 years. Byron looks at BPM market dynamics backed up by facts, while taking into account the perspective of the IT and business person. He is a frequent speaker and moderator on business processes, which will also be one of his roles as Community Manager.

Byron was the ERP and Middleware Analyst with the Datapro division of McGraw-Hill and IDC from 1991 to 2006. In these roles, he was the primary analyst for Business Process Management. He has conducted over 500 specific information-systems case studies. He has contributed to Application Development Trends, IT Business Edge, Research 2.0 and other publications.

Byron is also the principal of IT Investment Research, which is aimed at institutional and individual investors in IT, or anyone who enjoys peering under the covers of "the financials," where large companies and emerging IPOs like to bury their most interesting facts. His main area of interest is investment opportunities in enterprise software.

More by Dennis Byron

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