SCO Bankrupt. Files for chapter 11!

WANG? no.

This was SO unsurprising: I’m not going to comment as I don’t feel I have the authority. BUT, it seems like it was inevitable nevertheless. Read and follow this article on Groklaw.

Open Source Rules. O.K.

Novell: “We’re not even in the Unix business anymore.”

Novell start to discuss the implications of the legal victory they achieved against SCO on the 10th August.

In a decent summing up of opinion on infoworld by Elizabeth Montalbano, we get:

“We’re not interested in suing people over Unix,” Novell spokesman Bruce Lowry said. “We’re not even in the Unix business any more.”

And Novell’s own CMO John Dragoon gives a neat and concise diary of events that led to Friday’s momentous decision:

“This is a great outcome for Linux and the open source community. A big cloud has been lifted. Customers and developers can deploy and develop on Linux with increased confidence that SCO’s copyright allegations around Linux will be put to rest. “

Checking SCO’s stock quote tells us what the market really thinks: Down to just 37c when I looked. That’s a fall of over 75% since market close on Friday and a market capitalisation of about $8m (or approx. £4m in Sterling).

I can’t see how SCO can remain a viable business for much longer. As an anonymous commentator wrote on a mailing list – Novell could buy them with spare change and that would be the end of that. Although it’s a bit of a waste of $8m I guess. There are plenty of other companies out there with that sort of cash to burn…

  • Microsoft Corporation: $268.14B
  • International Business Machines Corp. : $151.90B
  • Hewlett-Packard Company: $122.69B
  • Red Hat, Inc. : $4.12B
  • Novell, Inc. : $2.26B
  • Sun Microsystems, Inc.: $16.74B
  • Oracle Corporation : $99.96B

SCO, Novell, IBM, Microsoft

“May we live in interesting times…”

On Friday last, the judge in the extraordinarily long court case brought by SCO (The SCO Group Inc. formerly the Santa Cruz Operation) against Novell gave his judgement. SCO lost.

The basics of the case, which is both complex and long-winded as only the American legal system can, was that SCO claimed they owned the copyright for UNIX and that Novell didn’t. The implications of this fairly simple claim went much deeper however. If SCO had won it could have opened the door for massive litigation against IBM and other vendors of UNIX and also had serious implications for Linux as they also claimed that Linux contained copyrighted UNIX code…

And more succinctly put by the Washington Post

Software company Novell owns the copyrights covering the Unix computer operating system, a federal judge ruled, deciding against the company that bought certain rights to Unix from Novell 12 years ago. “The bill of sale is clear: all copyrights were excluded from the transfer,” U.S. District Judge Dale A. Kimball wrote in his 102-page ruling. SCO Group Inc. is seeking billions of dollars in royalty payments from hundreds of companies that use the Linux computer operating system, which is modelled on Unix. The ruling means SCO probably cannot successfully sue Linux users for copyright violations.

The ruling given last week should now clear the way for the legally challenged/scared corporations of the US to use OSS/Linux with much less fear about potential law suits. This can only increase the pace of growth and adoption of these disruptive technologies.

Here’s my Recommended Reading list for this story.

Well – this looks like the main legal barriers for adoption of Linux (especially in the USA) have been removed, the SCO v IBM lawsuit is groundless and SCO will probably go bust as they will have some very BIG bills to pay.

Following note added 20:30pm (15:30 EDT) 13/08/2007:

Just before the USA markets closed I thought I’d see what the investors made of the judge’s decision. Not good. SCO (NASDAQ: SCOX) was down by a whopping 73% from $1.56 on the close Friday. It opened this morning at 0.45c and dipped during trading to a low of $0.35. Ouch….