2004-10-28 DE Ballmer: Linux Customers Migrating Back to MS due to Patent Risks

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Englsich version of the Executive E-Mail

http://www.microsoft.com/mscorp/execmail/2004/10-27platformvalue-print.asp

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In a round-robin letter which was apparently sent out to millions of Microsoft customers on 2004-10-28 after gaining media publicity a day earlier, Microsoft's CEO Steve Ballmer warns of the dangers of migrating to the GNU/Linux platform and points to great efforts that Microsoft is making to prevent this trend. Ballmer mainly highlights two kinds of efforts:

• financing of various studies that compare both systems by all kinds of metrics, so as to make it easier for customers to decide
• indemnification of customers against risks of patent litigation, which, Ballmer stresses, can cost a customer millions of dollars

As a case example of a company that was convinced specifically by the indemnification program to switch back from Linux to Microsoft, Ballmer cites the Regal Entertainment Group and quotes their CIO J.E. Henry as saying that his company was, due to its size, prominently exposed to the "intellectual property risks" associated with Linux and that, thanks to the new indemnification contract with Microsoft, he feels greatly relieved now.

Quote from the Mail:

• It was certainly a factor for Regal Entertainment Group, the largest movie theatre chain in the world. In 2001, they moved to Red Hat Linux. After evaluating Linux in their business for several months, however, they migrated to the Microsoft platform – not only because of lower TCO, stronger support and services, and greater reliability and manageability, but because they were more fully indemnified on IP. J.E. Henry, CIO of Regal Entertainment, told me that "reduced risk was a decision factor in selecting Windows over Linux. We needed to minimize our exposure to the distraction of potential IP infringement claims, and we had a big enough open source presence to be concerned. With the way that Microsoft stands behind its products, it's one less thing that I have to worry about."

The German version has more details.

For a critical appraisal of Microsoft's comparison metrics, see The Register: Linux vs Windows Security Report.

The FFII conference of Nov 9-10 in Brussels has two panels about the questions of patent risks with participation of prominent insurance offerers from the USA and EU, where patent insurance in general and specifically in the context of open-source software, has become a major subject of political controversy and various new proposed business models.