IBM, Daimler Chrysler, Autozone and Red Hat are some of the companies being sued by SCO for use of its Linux code constituent. The battle between free and proprietary software is intensifying, writes Jim Colgan

When Columbia law professor Dr Eben Moglen was co-writing the licence that gave rise to the Linux operating system 15 years ago, he worried about one thing: a big lawsuit his foundation could not afford to fight.

The backers of the open-source software, he thought, lacked the financial muscle of a corporate giant intent on stifling the free competitor in the future.

But, as that moment has come in the form of a case brought by SCO Group, a software provider in Utah, Dr Moglen considers Linux to be saved by the suit's very target.

SCO contends it owns the copyright to part of the code that makes up Linux and has started suing companies who use it. The case with the highest profile is against hardware giant IBM.

IBM has embraced Linux in recent years. It has shipped the free operating system on its servers and even improved on earlier versions.

In fact, IBM's apparent co-opting of Linux as a brand was epitomised when it ran a TV ad during this year's Superbowl (America's most-expensive air time) with the slogan "Linux is shaking things up".

Dr Moglen recognised that IBM might play the role of a saviour in some form, should the one thing keeping Linux free - the GNU General Public Licence (or GPL) - come under attack.

"I schemed for years about various ways that, when the crunch came, there could be some way of begging, stealing or borrowing from the IBM chequebook," Dr Moglen says.

He never imagined the people suing would involve IBM themselves.

SCO began its case against IBM early last year. Last month, it sued car-makers Daimler Chrysler and Autozone for using Linux.

SCO also has a case against another software-maker, Novell, while a suit involving Linux distributor Red Hat has just been put on hold.

As the list of players involved grows (along with the acronyms), the SCO/IBM saga is amounting to a showdown between free and proprietary software, according to industry analysts.

And, in the wake of the legal onslaught, conspiracy theories are flying among the open source community.

However, as an indirect Microsoft connection emerged in a leaked e-mail last month, the theories are gaining credence.

The suits seek a minimum of $5 billion (€4.2 billion) in damages, and SCO is demanding all commercial Linux-users to purchase a licence or face litigation. The company claims IBM improperly inserted code into Linux that belonged to the Utah company.

SCO initially sent warning letters to Fortune 500 companies it said were violating its copyright.

"We were helping them understand our stance on things... how US copyright law... protects code that SCO owns \ we're alleging is in Linux," said SCO spokesman Mr Blake Stowell.

So far, fewer than 50 companies purchased the licences and some say they would rather pay $20,000 licence fees than risk expensive court action.

Although SCO owns the licence for Unix - effectively Linux's proprietary counterpart - its ownership has changed hands several times. In fact, its previous owner, Novell, claims it still owns the rights.

Unix has held sway as the dominant server software over the past decade but Linux adoption has grown steadily in recent years.

A study last month by Forrester Research found 60 per cent of businesses it surveyed used Linux - primarily for cost reasons.

Analysts say high-profile Linux-users such as Google and Amazon.com also helped its spread.

"In my opinion, it's going mainstream now," says Forrester analyst Mr Ted Schadler.

He also cites earlier research that shows SCO litigation was failing to put a dent in companies' plans to roll out Linux.

Apart from its impact on Unix, Linux has also posed a looming threat to Microsoft's software empire. Linux - as a desktop operating system - has been around for years and has never stolen much ground from Windows.

But, as Microsoft readies its Windows' successor, Longhorn, open source devotees point to a clear motivation for involvement. Microsoft and recently announced partner Sun were the main buyers of SCO licences last year.

And a leaked e-mail from a SCO consultant showed a Microsoft executive encouraged an investment in the company.

Among the online open source community, talk of conspiracy theories and anger at the SCO Group has raged since the lawsuits began. Among this is Groklaw.org, a website run by Linux enthusiast and paralegal Ms Pamela Jones. Ms Jones has thoroughly documented the case and feels the lawsuits' target goes beyond the cited code.

"This is about killing the GPL. It interferes with profits," Ms Jones said in an e-mail interview about the licence Columbia's Dr Moglen co-created to develop software like Linux.

The licence ensures developers don't own the copyright of any modifications or combine it with proprietary software. This is because, Dr Moglen says, Microsoft sees the GPL as a threat.

He goes so far as to say the fight is really a proxy between IBM and Microsoft.

SCO's Mr Stowell says IBM's defence "caused us to go after the GPL". However, he believes it is fundamentally flawed anyway.

But Ms Jones says the open source community deems the GPL vital. "It's the core protective licence that defends against Attila-the-Hun companies wishing to raid the community's stockpile of software or shut the community down," she says.

SCO's core business, selling proprietary software, has brought declining revenues, but its stock price jumped in the wake of the suits.

Last year, it rose from $3 to more than $20 in six months. The share price is currently around the $10 level.

Mr Dion Cornett, an equity analyst with Decatur Jones, says the fall shows investor scepticism over SCO's chances.

And anyway, he adds, "it's not clear if the money they have in the bank today is sufficient to take them all the way through the litigation".

And since the IBM case isn't expected to reach jury stage until September 2005, it won't be over any time soon.

Indeed, SCO's Mr Stowell admits the future of the company critically depends on the outcome of the lawsuits.

But, as to relying on other businesses in the event the cases fail, Mr Stowell says: "We'll stick to our chances."