SCO Group, which claims its blueprint for Unix software is embedded illegally in versions of the free Linux operating system, yesterday unveiled details of a controversial licensing plan for companies using Linux.
The plan, which will initially cost $699 for a computer with a single central processor running Linux, has irked advocates of the software operating system. Unlike Unix or Microsoft's Windows, Linux can be copied and modified freely.
SCO, based in Lindon, Utah, sent shock waves through the ranks of Linux users in March when it sued IBM for $1 billion, charging that the world's largest computer company had taken parts of the Unix code and introduced them into Linux, violating SCO's intellectual property rights.
Linux is supported by a far-flung network of programmers sharing software code. Because it can be obtained for free, Linux has caught on with companies seeking to lower technology costs. It competes with Microsoft in the market for server software for managing computer networks.
Many of those programmers are gathered in San Francisco this week for the LinuxWorld Conference and Expo, one of the industry's largest gatherings.
SCO said its Linux licensing plan is a one-time fee that customers can pay to avoid infringing on SCO's intellectual property rights. The price will double at the end of an introductory period that ends on 15 October.
Licensing terms for computers with multiple processors will be posted in detail on SCO's Web site, said Chris Sontag, SCO's senior VP in charge of its intellectual property and licensing efforts.
Shares in SCO have skyrocketed from their March level of around $3. The shares rose 41c, or 3.4%, to $12.49 in Nasdaq trading yesterday.
IBM, Red Hat fight back
IBM, which competes against Microsoft and Sun, has adopted Linux as a way to sell its computer hardware and support services.
IBM and Linux distributor Red Hat have disputed SCO's claims, saying they were baseless.
Red Hat, which makes money by distributing automated updates to Linux software, filed a formal complaint in federal court against SCO on Monday to stop SCO from making claims that would harm Red Hat's Linux business.
SCO CEO Darl McBride rejected the lawsuit, saying that IBM and Red Hat are responsible for illegally distributing software code that it owns and putting their customers at legal risk.
Since launching its campaign to collect fees for Linux, SCO has persuaded Microsoft to pay for a Unix licence. Microsoft said it paid for a licence since it develops software that works with Unix.
Sun Microsystems, which acquired a comprehensive licence to use Unix years ago, said SCO's legal actions would not affect its business or customers.
"We have the luxury of not having IBM or Red Hat's problem," said Jonathan Schwartz, who runs Sun's software group.
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