Strategic CIO // Executive Insights & Innovation
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9/5/2007
06:41 PM
Chris Murphy
Chris Murphy
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The SCO Syndrome: To Litigate Without Annoying Would-Be Customers

Do CIOs worry when their key IT vendors are knee-deep in patent lawsuits? Dave Hitz doesn't think so, but the NetApp founder is concerned enough that he blogged about the topic when suing Sun this week. His pitch: Hey, c'mon, we're not being SCO here.

Do CIOs worry when their key IT vendors are knee-deep in patent lawsuits? Dave Hitz doesn't think so, but the NetApp founder is concerned enough that he blogged about the topic when suing Sun this week. His pitch: Hey, c'mon, we're not being SCO here.I talked with Hitz about why he took that approach when storage vendor NetApp sued Sun this week. "My goal was to bring up the worst case possible," Hitz says. He says SCO did a lot of things wrong, including being extremely vague for a long time about exactly what was allegedly infringing. Hitz says NetApp's complaint (PDF here) is more detailed than most intellectual property cases in spelling out why it believes Sun's ZFS storage software infringes. He also described SCO's approach as "scorched earth" in suing multiple companies, including software end users at one point. NetApp is focused on Sun, he says.

"My fantasy is people look at this, see what we've done, say 'NetApp isn't SCO,' and forget about it," he says. (For SCO's view of its case see our interview with CEO Darl McBride.)

Sun in a statement Wednesday described the lawsuit as a "direct attack on the open source community," and it's more than happy to try to draw NetApp customers into the discussion:

ZFS is the fastest growing storage virtualization technology in the marketplace, and NetApp's attempt to use patent litigation to inhibit the meteoric rise of open source technologies like ZFS is tantamount to being unhappy with gravity. As Sun knows well, and NetApps' customers obviously recognize, innovation works better than litigation.

Do customers care? Hitz wrote his blog because patent litigation, particularly related to IT, is so controversial. But he thinks most business customers have a very short worry list when it comes to such suits. One is that the company is dying, and patent suits are a last-gasp attempt at revenue. NetApp's sales are up 11% last quarter from a year ago, so Hitz isn't worried about that perception.

The other is that it'll keep companies from working together where they should, such as in support where products work together. Hitz doesn't expect problems, saying companies can litigate, cooperate where needed, and compete at the same time. He likens business customers' most likely reaction to how they felt about the Hewlett Packard board mess; it's something the companies must take care of, but that they don't expect to affect them.

Count on Sun to keep the heat on NetApp, reminding as it did in its statement that NetApp is the one that brought this to court:

It is unfortunate that NetApp has now resorted to resolving its business issues in a legal jurisdiction (East Texas) long favored by 'patent trolls.'

There are other patent cases cooking in areas where CIOs must make critical vendor decisions--Motorola filed suit just last week against Aruba, clouding the wireless infrastructure market.

My sense is Hitz is right --that such cases are more annoyance to IT decision makers than deterrents to buying from a certain vendor. But chime in if you've had different experiences with tech companies wrapped up in patent disputes.

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