U.S.-based open source advocacy body the Open Source Initiative (OSI) has said it was informed that the German Federal Cartel Office was "open to receive comments from the public" about the acquisition, and it has written to the office to air its concerns.
"The fact that Microsoft is leading the takeover of Novell’s patents is itself alarming to the open source community, but when it was revealed that Microsoft has recruited Oracle, Apple and EMC to be co-owners of the patents, the OSI Board felt compelled to request that competition authorities take a closer look at the proposed transaction," said Michael Tiemann, the president of the OSI.
Novell is being acquired by Attachmate, and the transaction involves the separate sale of Novell's patent portfolio to CPTN, a consortium lead by none other than Microsoft. Novell has agreed to sell up to 882 patents to CPTN for a sum of about $450 million.
Novell had previously acquired SuSE, a commercial open source software distributor. Patents involved in that deal make claims over open source software but have never been used against open source developers, the OSI said.
In its letter to the German authorities, OSI said that it is concerned because the deal with CPTN puts patents with claims on some elements of some open source and Linux software in the hands of companies that compete with that open source software, and Microsoft being the prime contender.
"The founders and leaders of CPTN have a long history of opposing and misrepresenting the value of open source software, which is at the heart of the Internet infrastructure and of many of the most widely used software products and services," it said. "The sole or leading competition for several products from the CPTN principals are open source."
"Principals have long acknowledged that Linux and Open Source software is a major threat to their businesses and have made hostile statements towards open source for the past ten years or so. Microsoft and Oracle both call out open source as a competitive threat in their most recent regulatory filings. The Linux and open source community needs to act swiftly and with great solidarity in the face of CPTN's hostile retaliation," the letter added.
The letter warns of "potential collusion" between Microsoft and the competing proprietary software companies and said that competition would be well served by an investigation by the German authority.
"The Open Source Initiative is concerned that the proposed recipient of Novell’s patent portfolio, CPTN, represents a serious threat to the growing use of open source software throughout business, government, academia, and non-profit organizations globally," it said. "We urge the regulatory authorities to recognize the significance of open source software as they consider the CPTN deal and ask them to investigate it further."
Although the software patents at issue are the same, the OSI said that the use of them by CPTN might be quite different and risky, compared to the use made of them by Novell, a company which have always fully supported Linux and the open source community.
"CPTN has absolutely no incentive in supporting open source as a competitive alternative to proprietary software. CPTN creates a cover to launch patent attacks against open source while creating for each principal a measure of plausible deniability that the patent attack was not their idea," it said.
"A lot more transparency is needed in this debate and we are urging German authorities to make this a top priority by blocking this acquisition and preventing it from happening," the letter concludes.
On Nov. 22, 2010, Novell announced that it has agreed to be acquired by application security firm Attachmate for US $2.2 billion.
The acquisition, which brings the Novell and SUSE brands to Attachmate, clears up Novell’s future after many years of speculation as to whom might be acquiring it.
Novell has also agreed to sell a few of its intellectual property assets for about $450 million to CPTN Holdings LLC, a Microsoft Corp.-led technology consortium formed eighteen months ago.
Attachmate develops enterprise application security software to help businesses deal with legacy applications, including a variety of terminal emulation and interoperability tools.
The company also sells application security monitoring tools under its NetIQ brand, a division it acquired in 2006 for $495 million.
The Seattle-based company plans to run the Novell and SUSE brands separately. Microsoft also gets in on the action, as it receives $450 million of unspecified Novell intellectual property. More details will follow in the next few days.
Jeff Hawn, chairman and CEO of Attachmate, said the acquisition of the Novell and SUSE brands will add significant assets to its current portfolio of Linux and open source applications, as well as to its proprietary software tools.
“We have a great deal of respect for Novell’s business, all its employees and its strong commitment to its many enterprise customers. We look forward to maintaining and further strengthening Novell and SUSE solutions to meet today's market demands," said Hawn.
After announcing Novell's acquisition, Attachmate’s website was unavailable.
The Novell and SUSE brands will be run as two separate business units alongside the Attachmate and NetIQ divisions, Hawn asserted.
The acquisition is expected to close in the first quarter of next year, pending the usual SEC regulatory clearance and Novell's shareholder approval.
Over the past year-and-a-half, there's been a lot of talk of Novell being acquired. Up until today, the most often-named company that could have acquired it was VMware.
There's been others as well, but VMware was the most often quoted as a potential suitor.