The Five Types of 'Linux' Corporations

Right now there is a great amount of commentary flying about. The problem is that its getting very difficult to wade through the non-lawyers and the pro-community lawyer activists as well as the corporate and IP lawyers and get to the real, impartial lawyers who are unbiased (if there is such a lawyer).

As such, I'm not going to even attempt to break into the legal aspects of the commentary. But what I will do is -- as more of a "supplement" than anything -- is lay out the Five (5) types of 'Linux' corporations. Why? Because the way corporations make products, approach licensing and, most importantly, "make money" has everything to do with how they approach 'Linux' -- 'Linux' being the trademark solution of the greater conglomeration of "community developed" software.

The Five Types of Corporations include:

1. Commercial: We use community software to create proprietary and IP-laden solutions
2. Open Systems: We use community software to create proprietary software that supports open standards and interfaces
3. Open Source: We develop some open source software ourselves, but still value our proprietary software and, more importantly, assert our significant IP portfolio on corporations for much of our revenue
4. GPL Friendly: We develop GPL (or compatible) software ourselves, and we open all our patents under the GPL (or compatible) license, but we still have some proprietary software and IP portfolio when it does not conflict with common Linux
5. GPL Absolute: We not only develop GPL software ourselves, but we only patent or hold other IP to protect GPL software

1. Commercial

Commercial software is the traditional software profit model. It begins in the mid-'70s when Microsoft was founded on the basis of using educationally-developed, acquired or otherwise psuedo "public domain" software and, later, software acquired in licensing agreements and then creating proprietary derivatives of them that are not encumbered by further ownership or licensing (e.g., royalties) outside of Microsoft. In its early days, this meant 1 time payments (although Microsoft, sometimes via IBM, had to settle out-of-court for its direct piracy of a third party's copyright). In the '90s on-ward, this often meant direct purchase of companies.

The Commercial model thrives on a "leech" attitude towards community developed software. It favors public licenses that allow them to derive all they wish without having to return any code. E.g., BSD software. It also thrives on not adhering to open standards, even if the original public licensed software does. This is the commonly termed "embrace, extend, extinguish" model. Take a great open standard, adopt it, change it so it only works for Microsoft products, and it becomes "the standard" -- extinguishing the original.

2. Open Systems

Open Systems are the traditional, pre-Free Software Foundation (FSF) model of software, much of what the early Internet was built upon. Companies not only participate in open standards committees and, more importantly, their software actually implements those open standards so they inter-operate with other software.

A key detail to participation and adherence in any open standards process, and sometimes the "cost of membership/logo/certification" is the declaration that the corporation will not assert any IP (e.g., patents) on the standard. This was the attitude of many developers of the early Internet -- from pre-breakup AT&T Bell/UNIX System Laboratories (USL) to various educational institutions to later commercial startups like the Sun Microsystems (named after the Standard University Network) and even established vendors like Digital [Equipment Corporation (DEC)] and Hewlett-Packard (HP). Again, this was the mainstay before the late '80s, and the revolution of the "GNU Public License (GPL)."

In addition to creating proprietary software adhering to open standards, these corporations still had proprietary software with asserted, proprietary IP as a mainstay of their revenue. So even today, while Sun and HP have moved to more GPL-centric models, there are still "Open Systems-based" corporations that thrive on BSD-like public domain software for proprietary code and proprietary solutions/IP. E.g., modern Apple Computer would fit in this category.

3. Open Source

Open Source is the newer-fangled term that is still sweeping the Internet almost a decade after it was coined. Terms like Free and Open Source Software (FOSS) or Free[dom]/Libre Open Source Software (FLOSS -- some not liking the term "Freedom" on its own for politically correct reasons) include Open Source and GPL (or compatible) software, but my categorization focuses on Open Source that is not regularly GPL-centric (or regularly GPL compatible).

It is extremely difficult to find any software or consulting corporation that is not at least an "Open System" if not "Open Source" corporation today. That is the result of the Internet. Only corporations that have control over distribution channels (e.g., Microsoft) or "killer apps" that force vendors to work with them (e.g., Apple) can avoid having to GPL or patent-unrestricted software. Especially when it comes to major hardware or system developers/integrators. Non-commodity hardware vendors (i.e., non-superstore/cheap/limited hardware) have to deal with GPL in some capacity. System developers/integrators have to base their systems on GPL-licensed code. As such, anything built with GPL code has to be released.

Which is where the difference between an "Open Source" corporation, one that merely deals with the GPL when required, and the following #4 and #5 begin.

An "Open Source" corporation is in the business of value-adding to GPL it distributes. This value-add is rarely GPL, but does not violate the GPL by merely distributing it with non-GPL compatible software. They strictly adhere to the GPL when they must modify GPL, but they avoid it at all costs. The majority of their software and solutions is proprietary or under a non-GPL license when it suits their needs to open the code -- especially if they have a very large patent portfolio which they extract a great amount of revenue from in licensing.

IBM is a perfect example of an "Open Source" company, and has been the overwhelming majority of its $1 billion dollar Linux investment integrating its hardware with Linux. It only more recently opened 500 patents that were threatening to keep various hardware support from being maintained in the Linux kernel (and many Linux developers are asking for more donation). The few donations (Eclipse being the only, major project release to date) have not been GPL, and most of IBM's donations to the community have been to partnerships and non-development related efforts. It's more recent $100 million dollar Linux investment in porting Lotus solutions has been entirely proprietary like most of the original $1 billion dollar investment.

But should IBM donate more patents to the Linux community, or more importantly, leverage those patents to defend Linux, it could be considered the following type.

4. GPL Friendly

GPL friendly is where many "established" Linux vendors and more and more solution providers, integrators and, even more so, developers have been moving as of late. GPL friend goes beyond just releasing GPL software, but aggressively donating all related IP to GPL software under an "open patent" license as well as using that IP to defend Linux. It includes corporations changing their existing product lines to use GPL and other community-developed software at the core of their software solutions, and not merely hardware (which is little beyond the Linux kernel).

These vendors still have proprietary solutions and their patent portfolios, but they only assert them outside of Linux, while using them to defend Linux when the software is released under the GPL. Quite often, they will release their older, established or just plain "this should be a standard piece of Linux" software as GPL without restriction and with no patent assertion on a regular basis. They feel that releasing software, at least the "basic capabilities," as GPL is crucial to adoption by the community -- even if the software is dual-licensed (with additional patent/IP licenses for non-GPL) so commercial software vendors can utilize it.

Hewlett-Packard, by far, the largest system integrator and consulting firm that is GPL friendly. Unlike IBM, a sizable chunk of their enterprise development and management software has adopted GPL and GPL compatible software at their core, which they have aggressive developed further. Sun Microsystems moved from merely a long-time Open Systems proponent to a GPL friend vendor when it bought StarDivision and GPL'd OpenOffice.org, which was the largest, major GPL donation until Red Hat bought JBoss which Sun has more recently trumped with its current GPL'ing of Java implemention into the OpenJDK. Sun has also become more entrenched with core kernel and Linux subsystem developments in the past 5 years, and is currently considering GPL'ing OpenSolaris (which would move it into the last category). In the hardware world, AMD and Intel (except when it comes to its software-based cache/memory coherency code for AGP/PCIe, which affects ATI and nVidia kernel modules) are heavily GPL friendly, because x86/x86-64 platforms thrive on the GPL.

Caldera was a GPL friendly corporation, even after their SCO acquisition. Despite their 2003 May (and on-ward) stance, Caldera had GPL'd much of its core, proprietary solutions and opened countless patents, and was doing the same with a great number of SCO components. Much of the original 2003 March (not to be confused with the 2003 May addendum and "Linux IP" FUD) was based on IBM withholding the Monterey source code from SCO and pulling out of the Monterey agreement 20 days after Caldera's acquisition (which is a long and involved debate over SCO's notification of the acquisition, IBM's response if any that would void any obligations upon the acquisition, etc...) because IBM feared that some of its core IP would be GPL'd (and not because of IBM GPL'ing SCO's IP, which is completely the opposite and grand-standing by SCO 2003 May on-ward).

And, last but not least -- despite all the recent rhetoric (to be addressed in another article) -- Novell is a very GPL friendly corporation. SuSE was largely an "open source" corporation before the Novell acquisition, and the great majority of its own developments were proprietary -- making SuSE more of a GPL distributor than a developer. That has radically changed since the Novell purchase, along with Novell acquisitions of Ximian and other, GPL absolute entities. In fact, much like the greatly demonized Microsoft-Sun broad licensing agreement that actually focused more on .NET/C#-Java and network service interoperability (even though there were partnership/channel aspects), the Microsoft-Novell agreement also has much to do with .NET/C#-Mono/C# and network service interoperability (in addition to partnership/channel aspects). But, again, more on that in a follow-up article.

5. GPL Absolute

GPL absolute companies are rare, but they exist. The first GPL absolute company was Cygnus, although it had changed into a GPL friend corporation and was bought by Red Hat. In fact, many GPL absolute companies that reinvent themselves into dual-licensing, GPL Friendly or even Open Source corporation that start closing up key Linux components are often bought by Red Hat. Because in the Linux world, there is only one major corporation that releases everything GPL (or GPL friendly if the original license was not GPL and they were not the originator -- e.g., BSD-licensed PostgreSQL) and then charges for it in a subscription model for those that want Service Level Agreements (SLA). And that company is Red Hat.

Except for its trademark, which has far more to do with US Common Law and loss of branding (long, related story on Cobalt-Sun and the end of freely redistributable/modifiable Red Hat(R) Linux, now released as the greater Fedora(TM) Project), Red Hat has absolutely no IP to protect and it uses every single patent and other right to protect GPL software. It is the official maintainer for numerous, core GNU projects that make up Linux (and even non-Linux systems), and employs a great number of maintainers who do nothing but work on GPL software.

When Red Hat wanted an enterprise directory service, it looked at improving OpenLDAP, but finally just secured the rights to GPL Netscape Directory Server (NsDS). When Sistina closed up the Logical Volume Manager (LVM) 2 code, Red Hat bought them out and GPL'd it. When Cygnus started closing up select projects (no longer just dual-licensing them) after it became the official developer/maintainer for GCC 3, Red Hat acquired them. Every single patent and virtually all copyright produced by Red Hat is under an open license and offered with and under the GPL, and they go out of their way to avoid any required license or agreement that asserts any IP or control over any software they

Yes, Red Hat will sign exclusive deals with partners and the distribution channel. Red Hat will be overly-anal on what it will and won't support when it comes to its Service Level Agreements (SLA) on Red Hat Enterprise Linux (RHEL) and related subscriptions/services -- far more limiting compared to Novell on their SuSE Linux Enterprise Server/Desktop (SLES/SLED) products. Red Hat is a corporation that makes money on those types of agreements -- but at no time and in no capacity does Red Hat place any limitation or license restriction on any code or assert any patent against anyone with its GPL absolute attitude.

If Sun continues to release more and more implementations and software as GPL, it may approach almost a GPL absolutist attitude. Unfortunately, it is unlikely the will ever be a "pure" GPL absolutist, as they still have the Java Community Program (JCP) and exert other control over select standards. But they are very close, including their long-standing lack of enforcement of various IP with countless open standards participation and leadership (which is why they were the backbone of the Internet until the last 10 years).

Summary

This article was written not to explain what companies are "good" or "bad" for Linux, but to explain how some companies garner their revenue. Companies that have IP which they license have to limit their exposure to GPL code, as GPL v2 and, even more so, GPL v3 will make increasingly difficult to assert even outside of Linux. There is also still the "real world" of licensing and patent assertion to protect Linux as much as defend against competitors, and short of Red Hat, that includes corporations having to liberally enforce patents outside of GPL software.

Much of this will be expanded upon, using these Five Types of 'Linux' Corporations, as a reference in future blog articles.