If you evaluate this unprecedented attack aginst Linux as a publicity exercise, well it has to be called a resounding success. It's short term value for SCO's business is questionable, and it's impact on SCO's popularity has been very negative. I find it difficult but not impossible to believe that SCO's executive suite could not or did not see much of this coming.
So if the executives saw the downside to their actions, there must have been some positive outcome(s) that were compelling enough to risk the near universal opposition to the lawsuit. What could those positive outcomes have been?
From SCO's strategic point of view, these outcomes are positive and significant. SCO's critical need is to maintain its current customers and upgrade them while adding new customers. Along with this, they need to reestablish a leading technical position to justify the cost of the product over 'free' alternatives. What the lawsuit does is buy them time and reduce the loss of sales while they ramp up new products.
The net direct income from lawsuits will probably be negative, even including the $10 million boost given them by Microsoft. Microsoft would never miss taking a shot at Linux, and that amount is far less than they have already lost from Linux replacing MS servers. Microsoft may have other help for SCO as this process continues, as they have much to gain from SCO's delay of Linux SMP expertise.
IBM, by contrast, has much to lose. IBM was an early and strong supporter of Linux, not just for competitive sales reasons. In an earlier article, I wrote about IBM's motivation for supporting Linux. In short, IBM currently has seven operating systems to support, each with 2 to 4 active versions, and for each, a set of support tools and utilities. Even IBM doesn't want to keep on spending that much money.
Gradually they will encourage customers to move to Linux as new applications are developed. Over an extended time, IBM will phase out operating systems as Linux can replace them. The reduction of development and support costs will be significant for IBM's bottom line. The cross platform commonality of Linux with reduced development and maintenence costs will win customer acceptance.
IBM has also established that they can profit directly on Linux installs by supplying customized Linux distributions with the X-Server series of hardware, and by supporting Linux across the whole range of IBM hardware. IBM also contributes code and innovations back to Linux.
SCO badly needs to see this stopped. IBM with Linux is a formidable competitive team, even though SCO does not directly sell hardware. In addition, HPC and Dell are also supplying systems with Linux. SCO's competitive position deteriorates daily.
Given the competitive position that SCO is in, the pressures on it from all sides, and the relatively low cost of their initial lawsuit actions, it should not be surprising that SCO followed this route. No clear alternatives exist for SCO's survival.
Based on my analysis, SCO's next steps will be to accelerate the threats and FUD while delaying as much as possible any real legal test of their position. A real test will strain their financial resources, distract the entire staff with worries about the outcome, preoccupy the executives with legal issues to the detriment of business, and generally hamper SCO. SCO wants to hamper its competitors, not itself.
SCO needs to put a permanent crimp in Linux's ability to compete. The legal attack on CopyLeft is a direct strike at that objective. If SCO can establish that there is even a small legal risk in using CopyLeft software, then every company looking at Linux will have to take that risk into account as a cost. For SCO, this could level the playing field, possibly even turning it in their favor.
SCO needs time to upgrade SCO Unix to include features now found in high end Linux server distributions, such as those from RedHat and SUsIE. How much time? My estimate is at least another six months, preferably a year from when this is written. So they need to have the first version ready by roughly April 2004. They need to follow this up with upgrades at approximately six month intervals, and make more versions of SCO Unix available over a wider price range to regain price and performance equality.
If they get the time, can they accomplish those goals? If they started the lawsuits with these goals in mind, I believe they can upgrade SCO Unix in time to regain a competitive product. If they are starting now, the six month date will be tough to meet unless great care is taken in selecting which technical aspects to upgrade. The one year date is feasible unless they get overambitious.
The above analysis implicitly assumes that SCO's plan will drive along with no major detours or bridge failures. They may have looked at various scenarios, but it is impossible to plan for everything. Remember the old military maxim: "No plan survives contact with the enemy."
The enemy in this case includes dominant competitors in the IT industry, almost the whole of the free software world, and a host of companies who use Linux servers in their company. On SCO's side is Microsoft, other OS vendors who are being hit by Linux, SCO's partners and many SCO customers, SCO employees and consultants.
At first glance, it doesn't look too encouraging for SCO. While there are no published results or surveys that I know of, I would be surprised if their lawsuits have not slowed the uptake of Linux as companies evaluate their exposure.
I expect that a trickle of very quiet license purchases will take place with no publicity. This is in fact a reasonable alternative for small businesses who compare the cost and disruption of litigation or changing their OS. I expect some companies will purchase SCO's Unix to replace Linux as another inexpensive alternative.
Both of these actions should come as no surprise to analysts, nor to SCO. I believe they were expecting the risk to become unacceptable to conservative businesses, with resulting replacement of Linux. I would not criticize any small business who made this decision as a prudent precaution.
The cost of a SCO license for Linux, or for replacement with SCO's Unix, is small in comparison to litigation or an OS conversion, even without including the costs of business disruption. Some businesses will gamble that SCO will fail against a prepared opponent, and ignore the risk. Some will delay use of Linux and look to alternatives.
Another group will find (to their surprise) that 'free' software isn't really free when you include the installation, support and learning costs. Some of them will compare loaded costs and switch to SCO or other supported OS.
Based on these issues, I think SCO has already had some measure of success, and is waiting for a good time to announce them. I suspect this time will come when the first upgrade of SCO's Unix is ready.
My preliminary conclusion is that SCO is doing better than popular impressions, many of which are based on emotional responses. If they have any legal victories at all, I wouldn't count them out. SCO could make this work, and come back pretty strong.
There is one weakness in SCO's attack that I have not seen discussed. Quite a few Linux users could escape the SCO lawsuit by switching to FreeBSD, which has a very effective Linux ABI, an Application Binary Interface. This means you can run Linux binaries without recompilation. The ABI is currently at the level of RedHat 7.3. In addition FreeBSD has ABIs for SysVR4, and OSF/1.
However, this 'escape' from SCO carries a smaller part (10 to 25 percent) of the cost of changing the OS, while making it possible to run current applications that meet the RedHat ABI. Because of the general compatibility of FreeBSD with Linux (both use similar design concepts), it is a viable alternative for companies who are determined to avoid both the Linux risk and the SCO alternative.
The existence of this escape will be selected by some, but it does not change the conclusions that I have drawn here. It is the risks and costs confronting the businesses that will cause them to examine the alternatives carfully. Some of those companies will select an option from SCO's menu, giving SCO their opportunity.
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