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Open Sources | Rodrigues & Urlocker » Why is Indemnity a Customer Concern?

September 12, 2007 | Comments: (0)

Why is Indemnity a Customer Concern?

Shaun Connolly at JBoss has a post about "What's in a Subscription". Shaun states:

"Put simply, a Subscription is comprised of: 1. Software bits 2. Patches and updates to the bits 3. Support in the use of the bits 4. Legal assurance"

The fact that OSS vendors have to use legal assurance/indemnity as a method for driving subscription purchases is due to the general FUD around OSS licensing, patents and copyrights. Things like copyrights & patents are vendor issues and should not be made customer issues.

Do any of us care that the Blackberry of iPod we use may have patent infringing technology inside? Or that these devices may include some copyrighted material (a la the software) inside? No, we expect that the vendors who sell us these products have taken care of that for us. Staying on the right side of the IP law line is another cost of doing business for RIM & Apple in this example. As a customer I may pay for this cost in the total cost of the product, but IP assurance is not used as a customer benefit, just as "we didn't pollute more than government guidelines allowed when building this product" is not used as a customer benefit. Again, isn't IP assurance a vendor cost and issue? Why have we [updated](the overall software industry)[updated] made this a concern for customers?

What am I missing?

PS: I should state: "The postings on this site are my own and don’t necessarily represent IBM’s positions, strategies or opinions."

Posted by Savio Rodrigues on September 12, 2007 05:35 AM


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Good point, Savio. I think you were implying this, but it's not 100% clear from your post, but "we" created this problem long ago. It predates open source. In fact, Red Hat didn't offer indemnification for a long time, until nudged to do so by Microsoft's and Oracle's actions in this direction around Linux.

Proprietary vendors have been doing this for some time, and I agree that it's silly and bogus (as patents relate to customers). Customers buy products, not IP insurance.

What's frustrating is that we have conditioned customers to demand this in their contracts, even when it provides them virtually no real gurantee. What good is indemnity from JasperSoft, for example? The cost of filing a lawsuit probably outweighs the cost of buying the software. It's ridiculous that the industry has fetished IP (and IP protection) to the point that we even have to have this conversation....

Posted by: Matt Asay at September 12, 2007 06:38 AM

Matt, I agree, this is a problem caused by FUD.

And I agree that these assurances provide minimal protection when considering the costs of a lawsuit or trial.

Oh wow - I agreed with Matt twice in a day...phew, the pigs are still sans wings. I think the magic number must be 3 ;-)

Posted by: Savio Rodrigues at September 12, 2007 06:53 AM

I find myself agreeing with both of you (Matt/Savio) on your points. To expand on Matt's point and address yours, however.... No one cares about RIM/Apple, since they're lower-priced buys, as Matt references JasperSoft. However, when we're talking RHEL + JBoss, we're not talking $300, either, so legal assurance is likely needed to counter-balance the FUD in the buyer's mind.

Of course, this post is ironic, and I will take the opportunity to point out that if I had a nickel for every line of FUD IBM has thrown at JBoss, well... ;-)

Posted by: Roy Russo at September 12, 2007 07:00 AM

Roy,

>if I had a nickel for every line of FUD IBM has thrown at JBoss,

You'd have $0.1? ;-)

I cannot speak for "IBM". I can tell you that in the 2+ years that I was product manager for WAS CE we never said anything about legal FUD and JBoss.

As far as I was concerned, we had no competitive reason to talk about IP assurance, because it was a moot point. I didn't think it was a customer value point, so why talk about it? Maybe because we're larger, we can get by without addressing IP assurance. But in my books, no vendor should talk about it. (NOTE: IBM doesn't talk about it with WAS CE or with any other IBM product).

The main thing we've said about JBoss is around the openness of the community behind JBoss vs. Apache Geronimo (which we build WAS CE from). I believe that this isn't a huge deal with customers, so you'll notice we don't talk about it much. We still believe it's a benefit, but if customers don't assign a lot of value to it, then why waste the airwaves? Especially when we can spend the time asking customers "if JBoss was so great why did Roy leave?!?!" ;-)

Posted by: Savio Rodrigues at September 12, 2007 08:26 AM

While some of the posters seem to enjoy taking shots at IBM, Microsoft, and Novell, I disagree that they are the prime culprits.

It seems to me that the activities of SCO are a far greater threat to customers, and the FOSS community at large. As far as I know, they are the only ones to directly threaten specific customers. As far as I know, SCO is the only company to offer "indemnity licenses" to specific organizations.

No, you say, SCO's recent legal losses have neutralized that threat. Maybe it was never that big a threat in the first place. Well, they were making threats, and very publically too. Lots of actual or potential customers heard about them.

Seems to me that SCO has causes big problems in this industry. That's why indemnity is on customer's radar screens. Even if SCO as a specific source of these threats has vanished, the concern remains in the eyes of the customers.

And, in the unlikely event you'd forgotten, it was IBM who spanked SCO in the courts system.

Posted by: Brian at September 12, 2007 08:39 AM

Savio,

I'll agree with you, that in my time at JBoss, I didn't see IBM promote any "Legal FUD" attacks on JBoss. (Not in the open, anyway)... most likely due to the IBM/SCO issues going on at the time.

[Maybe because we're larger, we can get by without addressing IP assurance.]

An interesting point, as smaller/newer players do present more risk to buyers. Legal assurance is certainly one way to mitigate that risk.

[Especially when we can spend the time asking customers "if JBoss was so great why did Roy leave?!?!" ;-]

*JBoss* is *still* great, and I'm better for being part of it.

Posted by: Roy Russo at September 12, 2007 09:15 AM

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