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Novell sheds (a little) more light on its patent access deal
May 24, 2007

In early May I noted that a new explanation had emerged as to why Novell entered into the patent agreement with Microsoft. According to an Olliance Group summary of a Q&A with Sam Ramji, director of open source technical strategy at Microsoft, and Justin Steinman, director of marketing for Linux and open platforms at Novell:

“The cross-licensing agreement that Novell signed with Microsoft, according to both Justin and Sam, was necessary as Novell required sanctioned access to Microsoft’s code in order to develop open source interoperability without violating MSFT's IP.”

That didn’t seem to fit with earlier explanations of what the patent covenant was for, so I asked Novell for an explanation. Unfortunately, that just raised more questions.

I just received answers to some of those questions from Novell, which provide a little more information about Novell’s access to Microsoft patents and how that relates to the overall patent covenant deal.

Q. How does Microsoft promising not sue Novell customers gives Novell engineers sanctioned access to Microsoft code?

A. The covenants Microsoft makes to Novell customers do not provide Novell with access to Microsoft code. The terms of those covenants are publicly available on the Web sites of both Novell and Microsoft. As announced in November 2006, Novell and Microsoft have entered into a Technical Collaboration Agreement under which the companies work to achieve interoperability between Novell and Microsoft offerings. When ISVs enter such agreements, the terms customarily provide for exchanging relevant technical information. Novell has no intention to distribute the code of Microsoft or any third party in an unauthorized manner, and employs customary measures to comply with our license obligations.

Q. Is there another part to this agreement (ie a patent license between Microsoft and Novell) that has not been previously made public? If so, what are the terms?

A. While Novell and Microsoft have publicly disclosed many aspects of the agreements announced in November 2006, the agreements themselves remain confidential. As previously stated by Novell, additional terms will be made public in future SEC filings. With that said, Novell has publicly stated that its agreement with Microsoft does not include a broad patent cross license or cross covenant not to sue between the companies.

Q. Has Novell become a WSPP or MCPP licensee as part of this agreement?

A. As a general policy, licensing deals to which we're a party aren't made public by Novell.

Aside form the point that this final answer is a non-denial denial, the answers do explain how Novell got “sanctioned access” to Microsoft’s code, but to my mind, also undermine the suggestion that the patent covenant agreement was somehow necessary for the technical collaboration.

In fact, I would suggest that the answer to the first question makes it clear that the patent access granted by the technical collaboration agreement and the patent covenant not to sue customers are completely unrelated.

It certainly appears to be at odds with Steinman’s earlier statement: “the intellectual property agreement provided a foundation for the interoperability between Windows and SUSE Linux Enterprise”.

Anyway, Novell’s internal accounting investigation has now come to an end which means the additional terms of the deal with Microsoft should be published before the end of the month along with Novell’s quarterly and annual reports. Don’t get too excited, however, as some of the details will remain confidential.