Open-Source Vendors Deal With Intellectual-Property Challenge

Red Hat, the biggest advocate of open-source software, concedes on its Web site that it keeps a patent portfolio as a backup, illustrating how far the intellectual-property issue is from being resolved.
Red Hat Inc. in its annual reports and routine filings with the Securities and Exchange Commission cites the need for third-party apps, competition from proprietary vendors, and open-source's lack of a track record as primary challenges to the widespread adoption of open source by big companies. Missing, however, is what's emerged as the greatest challenge to open-source adoption among large companies: intellectual-property rights.

Even as Red Hat promotes the position that software patents generally impede innovation in software development and that they're inconsistent with open-source software, the company acknowledges on its Web site that it does maintain a "portfolio of software patents for defensive purposes."

The fact that the biggest advocate of open-source software has to acknowledge it's keeping a patent portfolio illustrates just how far the intellectual-property issue is from being resolved.

Mistrust is the greatest impediment to open source's growth within large companies, says Patrick McGovern, net director for, an online repository for open-source programs., which is operated by VA Software Corp. subsidiary Open Source Technology Group Inc., requires only that programmers write their code in an open-source license for that code to be posted to the site. "We create a fertile ground for development and then just let people go," McGovern says. No attempt is made to check the software for intellectual-property violations or analyze the quality of the code--that's left to the vendor community and for users, respectively.

The antidote to mistrust is time, McGovern says. Four years ago, the LinuxWorld conference was attended primarily by programmers; this week's edition was full of IT people looking to get more comfortable with the technology. "Until you get that comfort level, it's very foreign and the trust has to be there," he says.

Despite the open questions, activity on's site provides evidence of open-source software's popularity. The site sees 700 new registered users and 70 new open-source software projects daily to go along with 10 million page views, McGovern says. "Still, open-source adoption won't be an avalanche; it'll be a gradual thing."

That patience is likely to pay off as companies slowly infuse open-source into their IT operations. Although construction and engineering company Fluor Corp. has begun to use open-source MySQL database and Apache Web server software in different areas, it will continue to run its SAP apps on IBM's AIX Unix operating system for its stability, says Robert Taylor, senior director of IT. Procurement systems and design software are much better candidates for Linux because they're not as critical to the company's central operations, he says, adding that copyright concerns surrounding open source will keep Fluor from doing its own open-source development for now.

Likewise, although E.&J. Gallo Winery uses Linux to run a handful of applications--including its grower-management system and some shop-floor systems in its glass factory--the winery remains committed to its Microsoft desktops and servers as well as its IBM AS/400, which runs a proprietary IBM operating system. "We look very hard at the implications of adding a new technology," Gallo VP and CIO Kent Kushar says.

Kushar has watched many major tech vendors embrace open source, but the outcome of this trend isn't yet clear. "We'll spend $10 million on something if we can see the ROI before we'll spend $1 million on something where we can't see the ROI," he says.

Advocates insist that open source is fundamentally changing the way companies buy software. "With proprietary software, you're carried along by your supplier's roadmap, and changing horses is very risky business," says Bill Weinberg, architecture specialist for Open Source Development Labs, a consortium of businesses, academics, and government whose goal is to develop Linux standards and promote usage. "Open source gives you the option of looking at new choices for your business." At the very least, he adds, the possibility of a customer's defection to open source gives the customer more leverage in dealing with a proprietary vendor.

This is not a pendulum swing away from proprietary software, Weinberg says. "It's a door opening, and I don't see how it will close."

To emphasize this, Weinberg points out that major open-source contributions from the likes of HP, IBM, and other prominent vendors means it's not in the interest of those companies to file lawsuits that would hinder the open-source market's progress. Time will tell.

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