SCO targets SMEs with Linux licence

The SCO Group is extending its intellectual property licence for Linux to small and medium businesses in the UK, US, Italy and...

The SCO Group is extending its intellectual property licence for Linux to small and medium businesses in the UK, US, Italy and France.

SCO claims that the operating system infringes on its intellectual property, and that Linux users who do not purchase its licence are in violation of SCO's copyright and could be subject to lawsuits.

The company first began offering the licences to large US companies last August. Now they will be available to any business customers in the UK, US, Italy, or France.

SCO hopes to make the licence available in countries such as Japan, South Korea, Taiwan and China by 1 February, but is uncertain which countries will be added, said an SCO spokesman. "We're still doing a review of the legal rules of being able to offer this licence in other countries."

Germany, however, will not be on the list because of a court order that prohibits SCO from "even talking about" its licence, the spokesman added.

Industry analyst firm Gartner has advised companies against purchasing SCO's licence until the company settles lawsuits with IBM and Red Hat that relate to its IP claims.

George Weiss, a vice president and research director in Gartner's server group, said that with Intel and IBM now backing a legal defence fund for Linux users who might be sued by SCO, and with Linux suppliers Novell and Hewlett-Packard now indemnifying their Linux customers, users have other options and are better off avoiding SCO's attention altogether.

John Ferrell, the head of the intellectual property practice at legal firm Carr & Ferrell, agreed. "It's a huge amount of money, and the issue is just not ripe yet for purchasing a licence," he said. "For small companies, what I'm advising my clients to do is just lay in the weeds right now."

SCO said the IP License for Linux is available at an "introductory price" of $699 per server processor; or $199 per processor for desktop users, although it would not say how long this pricing would be in effect, but pricing will double after the introductory period.

A fee of $3 per processor licence would be in line with industry standard rates for such licensees, provided SCO's claims proved true, Ferrell said. "The overall value of the code that's being infringed is small enough that the damages wouldn't be that great."

Because Novell also claims copyright on the Unix System V source code, it is unclear right now whether SCO actually owns the copyright to Unix, he added.

Robert McMillan writes for IDG News Service

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