Unix's war on Linux

Earlier this month, SCO Group sued IBM for allegedly misappropriating SCO's Unix technology and then building it into Linux. The lawyers want to project an image of a small company's valiant battle to protect its own intellectual property against an unscrupulous bully. The reality is more complex. Even though SCO desperately wants to avoid turning this into debate over the merits of opposing models for software development, the lawsuit filed against IBM looks more like a stalking-horse for a deeper struggle between proprietary and open-source software. Here's why.

Back in 1992, Novell's then CEO Ray Noorda believed he could bring down Bill Gates by competing against Microsoft on a variety of fronts. Novell subsequently acquired the likes of WordPerfect, Borland's spreadsheet business and the Unix software code from AT&T, which developed Unix in 1969.

Unfortunately for Novell, the plan only worked on paper. In practice, it turned into a mess and the board forced Noorda's retirement. His replacement, Robert Frankenberg, jettisoned the non-networking pieces of the company with UnixWare winding up being sold to the Santa Cruz Operation. Caldera (a company that Noorda coincidentally had co-founded in 1994) later changed its name after acquiring the Unix assets of SCO in 2001.

SCO has long concentrated on marketing in niches where businesses could run its version of Unix on less expensive Intel-based computers. That appeared a seeming advantage as Unix has not traditionally been an operating system that many IT managers chose to run on underpowered Intel chips.

Corporate reluctance began melting away in the last couple of years as Intel improved the capacity of its microprocessors. The emergence of Linux as an acceptable enterprise server operating system further accelerated the trend. For companies like SCO, which provide the integuments for more expensive, proprietary Unix server implementations, that's bad news in bells.

SCO now claims it got sucker-punched when IBM canceled a joint development project to build a new 64-bit Unix-based operating system for Intel platforms. The charge is Big Blue used misappropriated information filched from SCO and transferred that knowledge to the open-source community.

Filing this sort of lawsuit against IBM with its mammoth resources may sound like a fool's errand. But the chance for a big payday probably makes a lot of sense to a company losing money hand over foot.

So it was that SCO contracted Boies, Schiller & Flexner to handle the case, thus setting the stage for an especially entertaining drama--assuming this squabble does go to court--with David Boies battling the company he once famously defended after the U.S. Department of Justice sued IBM for antitrust violations.

SCO now claims it got sucker-punched when IBM canceled a joint development project to build a new 64-bit Unix-based operating system for Intel platforms.

Good choice. During the Microsoft antitrust case, I had the fortune to watch at close range as Boies, the lead attorney for the government, reduced sundry defense witnesses to drooling baboons on the stand. But even somebody this accomplished at taking people apart in court can't compensate for what is a deeply flawed--dare I say dopey?lawsuit.

It's not as if IBM had never gained any independent expertise developing an operating system that could run on Intel-based computers. Anybody remember OS/2? And IBM acquired Sequent in 1999, which had developed a version of Unix that ran on servers with dozens of Intel processors.

What's more, the lawsuit contains the implication that the open-source community is so incompetent that it couldn't advance without first tapping into SCO's trade secrets. Considering SCO's modest track record producing shareholder value, the Linux community is not missing much. (A $724,000 net loss on $13.5 million in sales during the quarter ended Jan. 31.)

If SCO's software engineering insight was so valuable, then management blew a historic opportunity by not recognizing the Linux trend and moving more quickly. Running to the court for damages is an after-the-fact acknowledgment that SCO backed the wrong horse.

To be sure, Big Blue has a clear self-interest promoting Linux and destroying the economic value of Unix on Intel-based processors. But isn't that the nature of competition?