Sun, Rivals Takes Issue With Microsoft's Antitrust Compliance

According to sources, Sun Microsystems forged complaints with the Department of Justice, charging that Microsoft's communications protocol licensing program is not in full compliance with the "letter and spirit" of the antitrust settlement agreement. Linux and industry watchdog ProComp point to other examples of Microsoft's non-compliance with an antitrust settlement that has existed on paper for a year, yet only received the U.S. District Court's stamp of approval last Friday.

"There are problems with the communications protocol licensing program related to the terms for licensing product going forward and elements of the program like royalties," said one source who is familiar with Sun's objections. "It's too restricted to the Windows world."

Last August, and as part of its tentative agreement with the Department of Justice, Microsoft unveiled a program to license approximately 112 previously secret communications protocols to third-party software vendors on a royalty basis to allow them to improve the interoperability of their software with Microsoft's Windows client and server. That program was announced and went into effect on Aug. 6.

Sun, which said Microsoft's efforts are insufficient, would not comment officially except to confirm that it has met with the Department of Justice on the matter. The Unix software and hardware vendor noted the restrictive nature of Microsoft's non-disclosure agreement (NDA) that precludes the company from talking publicly about the licensing program or any issues it has with the protocols.

"Microsoft's licensing agreement comes with an extremely strong NDA, which Sun signed, so the company cannot give you any information about the terms of the license," said a spokeswoman for Sun. "Sun did meet last week with the Justice Department about the licensing agreement, but of course that conversation would fall under the NDA as well."

Microsoft, for its part, noted that Sun's discussions with the Department of Justice are to be expected following an advisory the Department of Justice sent out after August seeking industry feedback. The software giant also characterizes its NDA as "plain vanilla," saying the only unique aspect is "allowing" third parties who enter the NDA to speak freely with government agencies.

"We set up a program that was very straightforward and relies on industry-standard practices when it comes to licensing intellectual property but, of course, there will be questions," said Jim Desler, a Microsoft legal spokesman. "The consent decree is relatively clear, but there will always be questions in terms of interpretation." He claims the terms of the agreement and the royalties are more than fair. "Royalties are reasonable and, considering the billions of dollars we put in developing this intellectual property, they're very fair," Desler added. "In making this agreement, the DOJ recognized we have an obligation to disclose technical information and we have the right to charge reasonable, nondiscriminatory fees for our intellectual property, and we set something up that's very fair."

Linux backers have also registered gripes about Microsoft's licensing terms for other communications protocols, including a key Internet protocol known as Common Internet File System (CIFS). that was made available last spring before the other communications protocols.

Jeremy Allison, a chief developer on Samba, a popular file and print server that competes with Windows, said he is not familiar with the details of the communications protocols licensing program because he has not signed the NDA. However, he criticized Microsoft's published technical information on CIFS,made available by Microsoft last spring,as insufficient and maintains the licensing terms on CIFS make it useless to open-source developers. He also criticized the CIFS release as a hollow effort.

"The settlement is useless for the Samba team or any other Open Source/Free Software project," said Allison. "Assuming that these licensing terms are the same as the terms they offered for CIFS alone some months before this settlement was announced, they require a fee paid for every copy of software shipped that implements them. This rules us out as it violates the GPL, of course, and is limited to five years, which means it isn't a stable enough agreement to base a product on and requires a Dunn and Bradstreet business number in order for Microsoft to determine if you are a worthy enough enterprise to be 'trusted' with this info. As a Free Software project, we don't have such a thing.

"On top of all that, if the documents they are releasing are the same as the CIFS document they published this year, then it's not even worth it," added Allison. "The CIFS document is a joke. It misses many important parts of the protocol and is incorrect in many areas."

Allison claims the communictaion protocol licensing terms are intended to bypass the "spirit and intent" of the consent decree's provisions for technical disclosure. "This whole thing is a shell game perpetrated on the DOJ to allow them to save face while allowing Microsoft to explicitly discriminate against their only competitor, the Open Source/Free Software movement," he said.

The concerns come just weeks before the official naming of the technical compliance committee that will oversee Microsoft's compliance with the antitrust settlement.

Microsoft and the Department of Justice are required to name three members of the committee by Nov. 14, Desler noted. Microsoft has candidates under consideration but would not comment on their identities.

In September, ProComp filed a compliant with the Department of Justice alleging that the user interface changes in Windows XP Service Pack 1 do not represent full compliance with the "spirit and intent" of the settlement agreement.

Lars Liebeler, an attorney with Thaler Liebeler and antitrust counsel for CompTIA, an industry association and Microsoft sympathizer in the antitrust case, noted that the Microsoft consent decree will be tried and tested as part of a natural process of determining what compliance means from a technical standpoint. He noted that other legal battles are not out of the question as various parties square off against Microsoft on issues of compliance.

"There are going to be disputes. It's a tug-of-war. Sun wants to push the envelope as far as it can, and Microsoft wants to comply with the settlement agreement and yet disclose only the information they're required to and necessary for interoperability with Windows," said Liebeler.

"That's what the whole fight is about in the European Union,how to draw line between what is Microsoft's proprietary product and the settlement agreement about what IP [intellectual property Microsoft isn't required to share," said Liebeler. "By the nature of antitrust, and software, there is no clear bright line for an absolute certain right answer. There will have to be determinations made on how much [Windows IP disclosure is necessary for [other software products to interoperate. It may end up in the courts."

Novell, a major software vendor that during the course of the antitrust case pushed for more technical disclosures from Microsoft, did not want to comment on Sun's claims. However, a spokesman agreed it may be too soon to measure technical compliance.

"There are still too many unknowns on the details of how this will all play out, for example, the specifics on interfaces, costs of royalties, etc.," said a spokesman for Novell. "All we could do is speculate at this stage, and we don't want to do that."

Brian Bergin, president of Terabyte Computers, Inc., a solution provider based in Hudson, N.C., said Sun and Linux backers will employ all means to force Microsoft to hand over its intellectual property and that Microsoft should not have to provide and publish these protocols at all.

"Sun is looking for money. Microsoft has never claimed to be an open-source company, and they've made it clear what their position on open source is," said Bergin. "If Microsoft owns the technology, they should not be forced to give it away. As soon as Ford gives me Explorers for free, I'll side with Sun."

Observers note that Microsoft has largely prevailed in the case and will have an edge given the government's reluctance to comment on product design.

While its case before the European Commission remains a major concern, Microsoft has defeated many rivals and state attorneys general that wanted the company to be broken up or forced to change its Windows product designs.

In addition to its victory against the nonsettling states late last week, the software giant beat another rival, AOL/Netscape, in another court skirmish when a Baltimore judge on Monday threw out a lawsuit AOL/Netscape filed against Microsoft.