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Open Sources | Rodrigues & Urlocker » A closer look at Oracle's indemnification offerings for Linux

November 16, 2006 | Comments: (0)

A closer look at Oracle's indemnification offerings for Linux

I had a few minutes to burn today, so I did what I'm sure you were doing: I read the Oracle Enterprise Linux Services Agreement. It's funny what you find when you start digging around in the legalese that governs the Big Announcement that Oracle made. It makes "Unbreakable Linux" look, well, a little flimsy.

First off, what do you think Oracle is covering with its BIG Linux announcement? Not much:

"Covered programs" is defined as the set of software products (limited to the kernel package) for which you have ordered Enterprise Linux support services, including any related program documentation and patches and bug fixes acquired through Enterprise Linux Support Services. [Emphasis mine.]
Hmmm...last time I checked, Red Hat Enterprise Linux is a wee bit more than the kernel. In fact, it includes 1,000+ individual packages [PDF], of which the Linux kernel is only one. If Oracle is only providing indemnification for the Linux kernel, it clearly is not providing indemnification for Red Hat Enterprise Linux, whatever Larry's fetish with Red Hat.

In fact, Red Hat Enterprise Linux contains nearly 2 million files of which only about 17,000 are related to the kernel. I was an English major, so my Math ability is not so great, but a little subtraction yields roughly 1,983,000 files in RHEL that Oracle will not be indemnifying.

Lest you start spluttering that at least its indemnification is unlimited, you might want to try reading the license. [You can find it here, assuming I uploaded it correctly.] If you just listen to Oracle's PR (in the form of its Oracle Unbreakable Linux FAQ), this is what you hear:

The indemnification is not in any way limited to the amount of money a customer has paid Oracle.
Apparently, Oracle's legal department missed the memo on this one. If you read Section J of the agreement (Limitation of Liability), you'll note that while Oracle offers unlimited indemnification for consequential damages related to an infringement claim (and that only for the one package, the Linux kernel), it caps all other damages at the amount you pay to Oracle:
EXCEPT WITH RESPECT TO THE EXCLUSIVE INFRINGEMENT INDEMNIFICATION ABOVE [which only relates to the kernel], NEITHER PARTY SHALL BE LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES, OR ANY LOSS OF PROFITS, REVENUE, DATA, OR DATA USE. ORACLE'S MAXIMUM LIABILITY FOR ANY DAMAGES ARISING OUT OF OR RELATED TO THIS AGREEMENT OR YOUR ORDER, WHETHER IN CONTRACT OR TORT, OR OTHERWISE, SHALL BE LIMITED TO THE AMOUNT OF THE FEES YOU PAID ORACLE UNDER THIS AGREEMENT, AND IF SUCH DAMAGES RESULT FROM DEFICIENT SERVICES, SUCH LIABILITY SHALL BE LIMITED TO THE FEES YOU PAID ORACLE FOR THE DEFICIENT SERVICES GIVING RISE TO THE LIABILITY. [Emphasis mine.]
I don't think there's much to worry about around indemnification of RHEL (whatever Microsoft may think), but it's interesting just how weak Oracle's indemnity really is.

I have no problem with Oracle providing real support and real indemnification. That's just competition. But I have a strong aversion to duplicitous, deceitful posturing to hurt a competitor without engaging it on your own merits. Oracle does a lot of things really well - why not compete with Red Hat on those terms, rather than on Oracle's ability to FUD?

Posted by Matt Asay on November 16, 2006 06:38 PM


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Wait wait wait... Oracle screws up, Novell insuts the community, IBM's totally absent, and Sun Micro comes to the rescue? Who would've thought...

Posted by: Robert Prendet at November 16, 2006 08:54 PM

I can't find the quoted text anywhere online and I find no references on Oracles site to the document. This could just mean it's hidden away someplace but it would have been helpful to post a link to the source document. Next, the way I read the sentence from the FAQ it means that the limitation is the same regardless of what you paid for it. In other words, if I paid $50 or $5000 to Oracle it makes no difference. This is in contrast to many plans that can limit the indemnification to the amount paid (a common scam in extended service plans) and Oracle is stating that this is NOT the case. Lastly, what really bugs me about this article is the confusion over the meaning of 'emphasis.' To me, lacking the source document he's commenting on, it's not clear that he has emphasized or commented on the text. In the first use, it's ambiguous, though I would normally expect legal documents to use commas rather than parentheses. In the second case, the formatting and the language imply a comment rather than an emphasis.

Posted by: Neil Cornell at November 19, 2006 12:58 PM

"Unbreakable" = FUD

...implies RHEL can break.

Posted by: Roy Schestowitz at November 20, 2006 03:52 AM

Neil, the following words from the article above were emphasised (though it's difficult to see as they're in caps):

ORACLE'S MAXIMUM LIABILITY FOR ANY DAMAGES ARISING OUT OF OR RELATED TO THIS AGREEMENT OR YOUR ORDER, WHETHER IN CONTRACT OR TORT, OR OTHERWISE, SHALL BE LIMITED TO THE AMOUNT OF THE FEES YOU PAID ORACLE UNDER THIS AGREEMENT

Posted by: Mo at November 20, 2006 05:24 AM

You should find out what acronyms stand for before making statements that clearly show you do not.
FUD != lie or lies
FUD = Fear Uncertainty and Doubt

Posted by: Linux FUDsters at November 20, 2006 06:22 AM

Although I'm no fan of oracle, They are a dominant player in enterprise IT. Their embracing Linux can only help speed up the overall acceptance of Linux in enterprise IT.

Posted by: Reuven Cohen, CTO Enomaly at November 20, 2006 08:17 AM

"I can't find the quoted text anywhere online and I find no references on Oracles site to the document"

Neither can I. This isn't a good thing - it appears that (at least when buying online), you don't get to see the contract you're paying for until after you make the purchase. All the product documents I could find on the Oracle site specifically state that they are not intended to be part of any contractual agreement. If it's not there, then it's not Matt Asay's fault that he can't provide a link.

"Oracle is stating that this is NOT the case"

They are, in a document which says "NOTE: NO CONTRACTUAL OBLIGATIONS ARE FORMED EITHER DIRECTLY OR INDIRECTLY BY THIS DOCUMENT." If they state something different in a document which does describe the contractual obligations, then that's bad.

The fact that Oracle don't have the actual contract terms on their site makes me inclined to believe that the version quoted by Matt Asay is the real thing, and Oracle's FAQ is misleading. You would think it was in Oracle's interests to show people the details of what they are selling - apparently they don't think so.

Posted by: Michael at November 20, 2006 08:20 AM

Come on, you know why Oracle did this and it is not indemnification. They showed that there is no sustainable open source 'business' model, they subterfuged the whole thing in one fail swoop. There is no barrier to entry, period.

Posted by: Glenn at November 20, 2006 10:39 AM

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