ServersSun Sets Sights on IBM's AIX Customers

Sun Sets Sights on IBM’s AIX Customers

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Moving to profit from SCO Group’s revocation of
IBM’s Unix license (which IBM denies SCO has the
right to do), Sun Microsystems charged in to play
the role of White Knight for Big Blue’s AIX customers.
UPDATE: Sun Microsystems moves in to capture IBM’s AIX customers by capitalizing on SCO Group’s revocation of IBM’s Unix license.

With an advertising campaign launched Wednesday, Sun
declared, “Attention AIX Users: Sun is here to help.”

The campaign comes after SCO , current owner of the Unix
operating system source code, followed through on its challenge to
IBM Monday and terminated
the company’s right to use or distribute any product based on Unix System V source code, due to an alleged contract
violation. That includes IBM’s own AIX operating system.

SCO has since amended its $1
billion lawsuit
against Big Blue to request a
permanent injunction to that effect, and also to add
additional damages to the suit in the form of a
share of the revenue IBM earns from AIX from June
16th until the matter is settled.

Amy D. Wohl, president of technology consulting firm Wohl Associates, said SCO’s legal strategy also hinges on how long the case could wend its way through the court system, now that it appears headed for litigation.

“SCO claimed that IBM would now owe it a percentage
of the revenue IBM earned from AIX (hardware,
software, and services), from June 16th until the
matter was settled, implying that the longer it took
to take this through the courts, the better, since
the sum would only be larger,” she said.

She also noted that SCO applied for a permanent
injunction rather than a temporary injunction. “This is very
interesting since it would be more common to file
for a temporary injunction which could, if granted,
provide immediate relief,” she wrote in a a research note.

“Permanent injunctions aren’t generally granted until the case
has moved through the courts and is found in the plaintiff’s favor — which, in this case, could take years. But to get a temporary injunction requires
several conditions SCO was probably unable to meet (we’ve consulted several lawyer friends in an attempt to sort this out). SCO would have to prove
that it was going to suffer immediate and irreparable harm if the injunction was not granted.

“SCO would have to offer solid proof that IBM was the
cause of this harm. The court would require SCO to post a bond equivalent to the value of the loss to IBM. IBM does more than $3 billion a year of AIX
business plus its Linux business so we’re talking more money than SCO could possibly have access to.”

IBM maintains SCO does not have the right to revoke its license. “SCO continues to make claims, and as we have said all along, our license is irrevocable,
perpetual and cannot be terminated,” IBM spokeswoman Trink Guarino said of SCO’s action. Noting that its license is fully paid up, IBM also declared that it
will not alter its use of AIX.

“IBM will continue to ship, support and develop AIX,
which represents years of IBM innovation, hundreds
of millions of dollars of investment and many
patents. As always, IBM will stand behind our
products and our customers,” the company said in a
statement Monday.

Guarino added, “IBM will stand by its customers. We
are fully committed to AIX. We continue to invest
and ship AIX. It is not a trivial exercise to port a
Unix operating system from one proprietary version
to another. And our customers know that.”

Noting that the next step is for IBM and SCO to go
to court and schedule a date for discovery, Wohl
said the market will continue to function in the meantime.

“It is
likely to continue to largely ignore this law suit,”
she said. “We’ve interviewed IBM, IBM customers, two
Linux distributions and some Linux customers about
customer reaction. All agreed that customers expect
IBM to sort this out and they were unconcerned
(although, in some cases, annoyed).”

Meanwhile, Sun hopes to capitalize on its strong
contract relationship with SCO for the Solaris
operating system to cherry pick IBM AIX customers
worried by the revocation.

“You chose Unix as your network computing platform
because you knew you were in it for the long haul,”
Sun said in an ad that appeared in the Wall
Street Journal
Wednesday. “You’d expect your IT
partner to show the same kind of commitment.

“Unfortunately, our friends in Blue have a problem
with licensing contracts that could make things very
expensive for anyone running AIX. Fortunately, Sun
is ready to help. The Solaris OS combines security,
low cost of ownership and product stability on both
x86 and Sparc systems.

“So, for all of you stranded AIX users, Sun is
offering a solution. For qualifying customers, we’ll
conduct a two-day Migration Consultation, gratis, to
assess and analyze your migration feasibility to the
Solaris OS. We’re even willing to take a trade-in on
whatever Blue boxes you’re running now.”

Sun said its migration consultants can assess and
analyze all aspects of a migration project: the
architecture, implementation and the management.

“The game, of course, goes on,” Wohl said. “One
unattractive thing that is about to occur is that
some of IBM’s competitors see this as a marketing
opportunity, rather than a disruption to the system
as a whole. So Sun has decided, apparently, to tell
customers that it’s not safe to buy Unix products
from IBM but that it will be glad to take that
business, since its Unix license from SCO is ‘safe.’
Sun needs to go take a course in systems analysis,
as taught by that master thinker Russel Ackoff
(Professor Emeritus at the University of
Pennsylvania and a founder of Operations Research),
and learn the importance at looking at the WHOLE
system before you try to identify and solve the

She added, “First, it’s not at all clear why SCO
picked IBM to go after (other than its size). So
far, we haven’t seen any proof of who put the
‘copied code’ (if there is some) into Linux. We
suspect that means all the Unix players, including
Sun, are at some risk. (In fact, there are hints
that SCO is about to go after another systems
vendor; we suppose Sun thinks that isn’t them.)

“Also, Sun is not just a Unix player. They are also a
Linux player and there is a danger that Sun will be
viewed as a proxy for SCO. We suspect that Linux
will be increasingly important to Sun over time. If
that is the case, the problem to be addressed isn’t
how to take short-term competitive advantage in the
Unix market, but rather how to resolve whatever is
at the root of SCO’s unhappiness, so the markets can
proceed. That would be a system solution.”

While SCO has terminated IBM’s license, SCO
said AIX customers are safe for the moment.

“While revoking of that license would make
customers’ licenses obsolete, at this point in time
we’ve elected not to take that approach with
customers,” Stowell said. “That’s not to say we
won’t at some point. But we see the customer as an
innocent bystander right now.”

He added, “What we would encourage AIX customers to
do right now is make IBM assure them that they’ll do
everything they can to try and bring this to full
resolution. I think that IBM needs to indemnify
their customers and right now I don’t see how they
can do that.”

However, Wohl said SCO has hinted otherwise. “SCO
has hinted that it might try to audit IBM’s
customers to see how much AIX they have and are
using,” she said. “If that occurs, we suspect that
IBM might encourage some of those customers to sue
SCO. Of course, so far, SCO has claimed that its
disagreement is with IBM and not with users, but
then why has it sent a threatening letter to Linux
users, suggesting they seek legal advice about their
use of Linux (which occasioned the German government
to seek and receive a court order against it), and
hint at AIX audits?”

SCO is suing IBM for misappropriation of trade
secrets, tortious interference, unfair competition
and breach of contract.

In its court filing, SCO noted, “However, as IBM
executives know, a significant flaw of Linux is the
inability and/or
unwillingness of the Linux process manager, Linus
Torvalds, to identify the intellectual property
origins of contributed source code that comes in
from those many different software developers. If
source code is code copied from protected UNIX code,
there is no way for Linus Torvalds to identify that

The firm alleged that a “very significant amount” of
Unix protected code is in Linux releases based on
the 2.4.x and 2.5.x Linux kernels “in violation of
SCO’s contractual rights and copyrights.”

Further, SCO said IBM breached its obligation of
confidentiality by contributing portions of the Unix
System V source code, derivative works and methods
to the open source development of Linux, and also by
using Unix development methods to make modifications
of the 2.4.x and 2.5.x kernels “which are in
material part, unauthorized derivative works of the
Software Product.”

SCO said this includes scalability improvements,
performance measurement and improvements,
serviceability and error logging improvements, NUMA
scheduler and other scheduler improvements, Linux
PPC 32- and 64-bit support, AIX Journaling File
System, enterprise volume management system to other
Linux components, clusters and cluster installation,
including distributed lock manager and other lock
management technologies, threading, general systems
management functions and others.

The firm sent a letter to
IBM Chairman and CEO Sam Palmisano on March 6,
warning him that IBM had allegedly breached its
contract with SCO by contributing portions of its
Unix-based AIX code to the open source movement, and
by introducing concepts from Project Monterey, a
joint effort by SCO and IBM to develop a 64-bit
Unix-based operating system for Intel-based
processing platforms, into Linux. IBM scrapped
Project Monterey in May 2001.

With the letter sent, SCO initiated a 100-day clock,
after which it said it has the right to revoke IBM’s
Unix license, which IBM entered into with then Unix
source code owner AT&T in February 1985. That clock
ran out Friday.

Related to the suit, SCO has stirred up a hornet’s
nest in the open source Linux community with claims
that “Linux is an unauthorized derivative of Unix
and that legal liability for the use of Linux may
extend to commercial users.”

It sent a

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