SCO gives Linux users more time

SAN FRANCISCO - The SCO Group Inc. has decided to give Linux users another two weeks before doubling the license fees it is demanding for its Intellectual Property License for Linux, and has backed off on earlier plans to begin sending invoices to commercial Linux users this month.

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The extension comes because SCO was late to market with its licensing plan, which was announced in August, according to Blake Stowell, a SCO spokesman. "We didn't actually get the license on our price list and make that available for distribution until early September," he said "It was our own fault that the license was getting out there a little later than we'd hoped."

SCO wanted to give Linux users more time to purchase the license at the lower license fee of US$699 per processor, Stowell said, so the company has extended its deadline until October 31. After that, pricing will jump to $1,399 per processor, he said.

At the same time, SCO has decided to hold off on its plans to begin sending invoices to Linux users. SCO is compiling a list of commercial Linux users, and, previously, it had stated that it expected to begin invoicing these companies by mid-October.

The invoicing plans have now been delayed indefinitely, said Stowell. "At this point we're pleased with the progress we've made on the licensing end, and we feel it's not something that we need to do at this time," he said.

Though they are not being invoiced, Linux users are still being contacted. They are being telephoned and being sent e-mail messages by SCO's sales force who offer to meet with them and explain the licensing plan, Stowell said. "Certainly if we don't have to send out the invoices that would be our preference. It's a more aggressive step," he added.

Sending out invoices may also force SCO into a course of action it is not yet prepared to take, said Gordon Haff, an analyst with research firm, Illuminata, Inc. in Nashua New Hampshire. "If they send out the invoices, they really have to follow that up with some action, if they're not paid. Otherwise it looks like their bluff has been called," he said.

Invoicing could also expose SCO to lawsuits, the analyst said. "It's one thing to file a lawsuit against a specific company, and it's another thing to present invoices to a large number of end-user companies, many of whom will regard them as fraudulent and take counter-action," Haff said.

SCO claims that the Linux source code violates its Unix intellectual property rights. In March, it launched a $1 billion lawsuit against IBM, saying that Big Blue had inappropriately contributed code to Linux. SCO has also threatened to sue individual Linux users on the basis of these claims. It introduced the Intellectual Property License for Linux as a way for Linux users to avoid litigation, even though SCO's claims have yet to be proven in court.