IBM's patent holder rhetoric against open source innovation

I previously wrote that IBM's reaction to the European Commission's antitrust investigation boiled down to diversionary tactics (some of them implausible, all of them irrelevant) and the usual rhetoric of patent holders. Now I'll comment a little more on the latter part, which is of a kind that's been annoying me ever since I became involved with patent policy years ago.

It's a problem that isn't unique to IBM: every time someone sues someone over a patent, you can hear similar things. But no other company has used that kind of rhetoric in such an obnoxious and hostile manner against free and open source software (at least not recently).

Likening an alleged patent infringement to piracy

This is how IBM's reaction to the announcement of TurboHercules's EU antitrust complaint in March 2010 began:

TurboHercules is an "emulation" company that seeks a free ride on IBM's massive investments in the mainframe by marketing systems that attempt to mimic the functionality of IBM mainframes.

Hercules is an independently-developed, 11-year-old open source project. If that amounts to free riding, then all of FOSS does in one way or another. Linux, OpenOffice, MySQL... you name it.

This is not really any different from those who seek to market cheap knock-offs of brand-name clothing or apparel.

That's just so wrong. What IBM describes there is called "trademark piracy" (although the use of the term "piracy" is debatable in that context). Someone who intentionally makes illegal use of a trademark such as Armani or Boss knows exactly what he's doing: infringing on someone's rights. But if software developers infringe a patent, it's inadvertent most of the time. Someone writes code and someone else obtained a patent that reads on it. No wrongdoing. That's why I commented negatively on the inclusion of patents in the Anti-Counterfeiting Trade Agreement (ACTA).

An Armani or Boss pirate will also try to fool customers, at least the credulous ones, with respect to the origin and quality of the product. TurboHercules doesn't do that. It clearly says that its software is the Hercules open source mainframe emulator, and every single person who downloads and installs the program knows that it's software -- not a mainframe. You can tell by the weight :-)

TurboHercules is a member of organizations founded and funded by IBM competitors such as Microsoft to attack the mainframe.

On the Microsoft conspiracy theory I commented in the previous posting. The notion that TurboHercules aims "to attack the mainframe" is so absurd. Those guys are fans of the mainframe, and by making mainframe software run on other platforms they certainly don't harm the mainframe.

TheRegister's mainframe expert Timothy Prickett Morgan pointed out that the mainframe ecosystem stands to benefit from TurboHercules, calling it "perfectly understandable to want the Hercules emulator to be available as a true alternative to IBM's mainframe iron running its mainframe software, and a perfect fool as well as a genius could readily see that having such an alternative would be a good thing for mainframe shops."

Innovation requires incentives for innovators as well as a functioning competitive environment

Still commenting on IBM's reaction to TurboHercules's March 2010 antitrust complaint:

Such an anti-trust accusation is not being driven by the interests of consumers and mainframe customers - who benefit from intellectual property laws and the innovation that they foster - but rather by entities that seek to use governmental intervention to advance their own commercial interests.

IBM, you can be sure that the European Commission is "driven by the interests of consumers and mainframe customers", which is why the EU competition authority even opened a second probe of IBM's behavior at its own initiative. Then the part on "intellectual property laws and the innovation that they foster" ignores that innovation takes two things: an economic incentive (and I agree that IP often plays a key role in that) and, equally importantly, undistorted competition.

On the last part about "entities that seek to use governmental intervention to advance their own commercial interests", TheRegister's mainframe expert Timothy Prickett Morgan accurately noted: "There isn't enough time in the day to list all the times Big Blue has benefited from the intervention of local, state, and federal governments around the globe."

And the final part of the March 2010 statement:

IBM is fully entitled to enforce our intellectual property rights and protect the investments that we have made in our technologies.

This again suggests that IPRs are an absolute thing, detached from all other considerations. They're not. There can be limits under competition law.

Let me make this very clear: I don't downplay the relevance of IPRs as a factor that results in investment (of time, money and energy). I've personally lived off IP for many years. I started writing articles for computer magazines when I was 15, computer books at age 16, then became involved with several commercial software projects (including three Blizzard games: Warcraft II, Diablo I, Starcraft I). I co-founded and managed a startup that depended on IPRs. MySQL was probably the most IPR-focused open source company, and I was involved with it as an adviser and shareholder. I defended some IPR-related strategic interests (broadcasting rights) of my favorite soccer club in an EU policy-making context. So I have a whole pro-IP biography, but I also value undistorted competition.

Let me quote TheRegister's Timothy Prickett Morgan again:
"As anyone who has watched the engineering done by Amdahl/Fujitsu and Hitachi [makers of mainframe products who effectively left the market] in the long and strange mainframe market knows full well, it was these companies that often innovated ahead of Big Blue [...]"

Patent validity and actual infringement are doubtful

Now that the European Commission launched its two parallel investigations of IBM's conduct, IBM radicalizes its patent holder rhetoric:

The accusations made against IBM by Turbo Hercules and T3 are being driven by some of IBM's largest competitors -- led by Microsoft -- who want to further cement the dominance of Wintel servers by attempting to mimic aspects of IBM mainframes without making the substantial investments IBM has made and continues to make. In doing so, they are violating IBM's intellectual property rights.

Those conspiracy theories are a distraction, especially in the IP context: should there be an infringement (which is at least doubtful), it would also be committed by the 11-year-old Hercules open source project. The TurboHercules product is Hercules as far as the software is concerned (alternatively available for GNU/Linux or Windows).

The part about "violating IBM's intellectual property rights" is very aggressive. Who knows whether the patents IBM believes are infringed are even valid? I talked in 2006 to a company that's pretty big in the smartphone business and they said a patent law firm had told them there's about a 75% or higher chance that a European patent someone asserts against an alleged "infringer" isn't even valid. So many patents get thrown out due to prior art, lack of inventive step, incomplete disclosure, or for other reasons.

Even if IBM asserts patents that survive an effort to bust them, there's still the question of whether they're actually infringed. Hercules is an emulator, so it isn't a CPU "clone": it has completely different inner workings. It takes the CPU instruction set as input in order to perform functions, just like a JavaScript interpreter takes commands in that programming language as input. What Hercules does internally may very well be so fundamentally different from what IBM's System z CPU does that the patents obtained on one don't read on the other.

The Supreme Court of the United States made a very appropriate statement in its 1966 ruling on the Brenner vs. Manson case: "A patent is not a hunting license." This meant to say that a patent isn't supposed to monopolize the right to solve a problem: it's supposed to relate to one particular solution. IBM's patents, if even valid, may protect its CPU. But they certainly can't prevent others from solving the same task -- the interpretation of a machine language instruction -- with different means.

The developers of Hercules haven't commmitted any wrongdoing by developing their solution independently. The investigation is all about whether IBM harms competition. I believe that's the case, and that's why I'm glad the competition probe was launched.

In the course of it, IBM may even learn that a patent is not a bullying license.

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NEON to lodge antitrust complaint against IBM with the European Commission

The Wall Street Journal was first to report today that NEON Enterprise Software, a maker of mainframe software, will lodge an antitrust complaint against IBM with the European Commission one of these days.

Meanwhile NEON has issued a press release confirming its intent to do so.

In December, NEON filed an antitrust lawsuit in the US against IBM over its practices in the mainframe market, which NEON calls "anticompetitive". In January, IBM then filed a countersuit against NEON, alleging an infringement of its intellectual property.

This SYS-CON Media article puts NEON's announcement into the context of other complaints against IBM and says that Allen & Overy, a law firm that previously helped such clients as Sun Microsystems with EU antitrust matters, is drawing up NEON's EU complaint.

French FOSS startup TurboHercules previously filed an EU antitrust complaint against IBM

Even though NEON's software is proprietary, I want to talk about the matter on this blog because there's a factual connection between NEON's complaint and the one previously lodged by TurboHercules, the French free and open source software startup that received a patent threat letter from IBM. NEON's press release also mentions TurboHercules.

By the way, after IBM's threat letter to TurboHercules became public, some IBM allies and apologists tried to muddy the water by claiming that IBM sent the threat letter only in reply to a question from TurboHercules, and others came up with the excuse that IBM was merely defending itself against an antitrust complaint. So if you heard any of those gross misrepresentations, you can easily verify that IBM asserted an infringement of "intellectual property" (as a synonym for patents) several months earlier. Apart from timing, an antitrust complaint could never have triggered the defense clause contained in IBM's patent pledge. IBM simply doesn't want to provide interoperability where its business interests collide with the concept of customer choice, even though IBM does a huge amount of lobbying to demand interoperability from others. Double standards. Open hypocrisy.

Differences and parallels between the problems NEON and TurboHercules have with IBM

NEON and TurboHercules are different companies that appear to have no connection whatsoever. NEON is a 15-year-old US company that sells proprietary, closed-source software. TurboHercules is a European FOSS startup.

NEON's founder, John Moores Sr., is a billionaire philanthropist and one of the founders of BMC Software, a major mainframe software company. TurboHercules' founder, Roger Bowler, is a mainframe fan and started the Hercules open source project about a decade before incorporating TurboHercules.

What NEON and TurboHercules have in common is that both are victims of IBM's bullying tactics.

Both just want to provide mainframe customers with much-needed cost-effective choice for their legacy software: hundreds of billions of lines of program code that are still in use, a very large part of it written in COBOL. NEON's zPrime software makes such legacy workloads eligible for execution on lower-cost (but fully functional) coprocessors. TurboHercules emulates the mainframe (System z) CPU on Intel servers.

But IBM wants to milk its locked-in mainframe customer base, hugely overcharging for everything that's needed to run legacy software.

NEON and TurboHercules are both very innovative in their way. IBM uses intellectual property, which should spur and protect innovation, as a destructive weapon against those companies. IBM told some mainframe customers using NEON's product that in IBM's opinion they're not allowed to do so and alleges that NEON wants to "induce" those customers to breach their license agreements with IBM. Many of you may be familiar with the Digital Millennium Copyright Act (DMCA), and IBM bases a part of its claims against NEON on that piece of legislation.

By the way, here's a YouTube video that NEON produced to explain why it believes mainframe customers have the right to use its zPrime product.

Procedural situation in the EU

Now NEON is about to file its EU antitrust complaint, and the European Commission is looking at TurboHercules' recent complaint. Previously, in January 2009, an EU antitrust complaint against IBM had been filed by T3 Technologies. The Commission still has to decide how to proceed with that one, too. If the regulator decides to lauch a full-blown investigation, IBM may have to defend itself against three complainants.

The European Commission isn't on any hard deadline for this but under its best practice guidelines a decision in the coming months is reasonably likely.

Some of the world's most critical data processing applications still run on mainframes. When any of us make a wire transfer, chances are that the bank will process it on a mainframe. Still today. Its demise was predicted a long time ago, but the mainframe isn't going away anytime soon. It's going strong. So it's an issue of major relevance to the worldwide (and European) economy to ensure that innovative solutions such as the ones provided by NEON and the Hercules open source project are available and that IBM doesn't bully anyone: neither customers nor solution providers. Enough is enough.

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IBM's defense clause that was never triggered

I had already explained in this post that there isn't any IBM defense clause that would ever have been triggered by TurboHercules. Hence, TurboHercules is still entitled to the benefits of the pledge.

But there's ongoing confusion. Just a few hours ago, someone commented on a previous post of mine and claimed that an "entity that has filed legal action against [IBM] is no longer protected [by the pledge]."

Another reader has, without posting a comment, challenged me to comment on the following quote from a senior IBM VP, a remark he made in a speech at a Linux event: "IBM has no intention of asserting its patent portfolio against the Linux kernel, unless of course we are forced to defend ourselves."

IBM may have said that, but it has nothing to do with TurboHercules. It's a statement about the Linux kernel. Hercules isn't the Linux kernel and IBM's patent pledge doesn't even mention the word Linux. IBM's comment has no effect on the scope of the patent pledge. The pledge stands on its own. It doesn't contain anything that would say: "You have to view this pledge in the context of whatever some IBM person said somewhere about something that is at best remotely related."

The pledge even encourages people to print it out and keep it like a contract. That underscores it's a document that stands on its own. The pledge defines one -- and only one -- defensive scenario in which IBM would not want to be constrained by the pledge. That clause exclusively pertains to "any party
who files a lawsuit asserting patents or other intellectual property rights against Open Source Software."

So IBM wanted to ensure that it could retaliate against a patent attack on open source even with pledged patents. But what TurboHercules did -- the lodging of an antitrust complaint with the European Commission -- is anything but filing a lawsuit asserting patents or other intellectual property rights against FOSS.

What TurboHercules did doesn't trigger the exception provided for in the pledge any more than reporting an illegally parked IBM car to the police would.

Antitrust and intellectual property are totally different areas of the law and the European Commission doesn't pursue patent infringement. (It doesn't adjudicate lawsuits of any kind.)

There are only three scenarios in which someone can claim that TurboHercules triggered the defense clause:

• that person hasn't ever bothered to read the actual pledge (which is only one page, plus a patent list) prior to commenting on this issue


• that person doesn't know that antitrust and intellectual property are disparate areas of the law, which I've now clarified


• that person intentionally wants to fool the community (and there are some out there who aim to do that)

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Roundup of coverage of yesterday's post

Many web media, and especially some very important ones, reported on yesterday's post to this blog (on IBM using patents against Free and Open Source Software).

Knowing that many will now want to find out what others are writing, I'd like to round up yesterday's coverage. I'll try to focus on just summarizing what those articles say rather than arguing the case again in this particular post.

Let me start with two sites contaning very useful additional material:

A file format conversion was provided by Benjamin Henrion (the president of the FFII): all pages of IBM's letter are available as PNG images on Benjamin Henrion's personal blog.

Roger Bowler, the founder of Hercules and TurboHercules, posted a new statement on IBM's patent attack to his blog. His statement doesn't contain any reference to my post. It's recommended reading because it explains TurboHercules' constructive, solution-focused approach to this matter. They want to serve users/customers. They're disappointed that IBM doesn't allow that, so far.

A positive surprise early in the day: An activist website named BoycottNovell, which was previously skeptical of TurboHercules' antitrust complaint, now says "SHAME on IBM" and expresses concerns over the theoretical possibility of IBM acquiring Novell and its patent portfolio. The title: "Big Blue Patent Monster"

Glyn Moody's blog (on the ComputerworldUK site) makes a number of good points in this article. Glyn points out that "IBM loves [patents] - for years it has obtained more of them than anyone else - whereas open source hates them." He also points to "larger issues", starting with this one: "One is that IBM is either a friend of open source, or it's simply an opportunist, supporting some projects when it suits, and attacking others when it doesn't."

TheRegister was also pretty quick to report: "Turbo-charged accusations fly", says "ElReg".

H-Online wrote that "IBM uses pledged patents against open source mainframe emulator"

ars technica provided a very comprehensive, insightful article (relatively early in the day). For those of you who are looking for some basic information on what the Hercules project is about and on the characteristics of the mainframe business, this is particularly recommended reading.

Slashdot also linked from its news item to the aforementioned ars technica article.

Dana Blankenhorn, a ZDNet blogger/lyricist, holds this effort up to mockery. He's entitled to that. And I'm entitled to fight for legal certainty for the Hercules project and its users, and for an overall outcome that will hopefully be a good one for Free and Open Source Software.

Commercial Open Source, Roberto Galoppini's blog, reports and links to TheRegister and Dana Blankenhorn's blog.

Maureen O'Gara looks into this issue in great depth in her article entitled "IBM Reneges on its Open Source Patent Pledge". If you read this article (and I can recommend it), make sure you also see the part below the table-of-contents box in the middle. That's where you can read about some aspects of IBM's approach to patents in general -- aspects that the other articles didn't address to the same extent. Maureen had insisted on knowing me from me why I didn't trust IBM back in 2005 when the original pledge was made. In a current context (European Interoperability Strategy/European Interoperability Framework), I'm also quoted on IBM's hypocrisy concerning open standards.

v3.co.uk has an article entitled "IBM accused of mainframe monopoly" and describes how "the situation came to head" in recent weeks.

The IDG News Service has a story that is centered around me ("Open-source advocate enter IBM antitrust fray") rather than the issue, citing "[p]eople close to [IBM]". None of that actually changes a thing about the fact that IBM, which it doesn't deny, wrote the letter to TurboHercules that I published.

Matt Asay is a professional open source optimist and writes that IBM's "patent claims show open source has arrived", portraying it as just a normal thing in general. But he does agree with me on some aspects of this. He concurs that "using patents to defend old monopolies is ugly" and also wants to know from IBM why two of the patents it once pledged to the FOSS community were listed in the letter to TurboHercules.

OSnews understands very well that the mainframe monopoly is "lucrative" for IBM and concludes: "So, there you have it. It would indeed seem that IBM only caters to the open source crowd when it has nothing to lose - when push comes to shove, and money's to be had, IBM doesn't appear to be too keen on open source at all."

NetworkWorld blogger Alan Shimel asks whether IBM speaks open source "with a forked tongue". He arrives at the conclusion that "they are consistent and will always do what is best for IBM. Expecting them to do anything more or less is silly." While I want this to be mostly a roundup, I would like to stress here that I fully understand the obligation every company has to its shareholders. But whatever IBM says about open source and open standards has to be seen against the backdrop of what IBM is doing to Hercules. Right now the only thing that is really consistently open about IBM is its open hypocrisy.

LWN.net believes the IBM/TurboHercules issue is just a "proprietary software squabble" (because TurboHercules' initial request to IBM was all about allowing IBM's customers to run their rightfully purchased copies of z/OS on non-IBM computers). However, there can be no doubt when reading IBM's letter and looking at the patents that IBM listed that those patents are not z/OS-specific. If Hercules, as IBM suggests, infringes those patents, then it will do so even in a 100% FOSS / 0% proprietary software configuration, such as running z/Linux (the mainframe version of Linux) on top of Hercules, which in turn (because it also needs an underlying operating system) would run on top of Linux for Intel x86/x64. Those patents are about the CPU instruction set, address management, virtualization/emulation - not about z/OS functions. In a follow-up article, LWN.net is not quite enthusiastic about IBM's approach to its patent pledge, distinguishing between "qualified" companies and others.

techdirt uses a very explicit language and concludes that the threat letter "calls into question IBM's real commitment towards moving away from supporting patents as a bullying tool."

Australia's iTWire writes that IBM has broken its 2005 promise. In the discussion part below the article, a reader (Richard Chapman) gives a vivid description of the situation: "Having IBM at your side in the land of Open Source is sort of like having a large carnivore as a pet. They may play and cuddle with you but you never know if or when they will revert to their natural ways and have you for lunch."

eWeek was the first website to report on IBM's official response.

The Financial Times and the Wall Street Journal analyzed IBM's reply and independently (they're fierce competitors) discovered an inconsistency between what IBM says now about possible patent litigation even against open source versus what the language of the actual 2005 pledge said. IBM now (unlike back then) says that the pledge is only meant to benefit "qualified" companies. The Wall Street Journal is right to ask: "If TurboHercules doesn’t qualify, who does?" And the Financial Times finds that "[e]ven under a very generous reading of the case, IBM is stretching the definition considerably to defend its turf. There’s a clear message there for any other open source company rash enough to try to take on Big Blue with its own weapons."

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IBM breaks the taboo and betrays its promise to the FOSS community

After years of pretending to be a friend of Free and Open Source Software (FOSS), IBM now shows its true colors. IBM breaks the number one taboo of the FOSS community and shamelessly uses its patents against a well-respected FOSS project, the Hercules mainframe emulator.

A reliable source close to the Hercules project has provided me with this letter that Mark Anzani, IBM's mainframe CTO, recently sent to TurboHercules SAS, a French startup founded by Roger Bowler, who started the Hercules project 11 years back. The letter comes with a "non-exhaustive" list including 106 IBM patents plus 67 pending patent applications.

This is so appalling that I felt compelled to show to the FOSS community what IBM is doing: IBM is using patent warfare in order to protect its highly lucrative mainframe monopoly against Free and Open Source Software.

Patents against FOSS and customer choice

The Hercules project is anything but anti-IBM. Hercules just wants to provide customers with an interesting and much-needed choice. In order to do so, Hercules is simply seeking a way that its customers will be allowed to run IBM's z/OS mainframe operating system on Hercules. IBM generally does not allow its customers to run z/OS (hence also the application software those customers internally developed on top of it for trilions of dollars) on non-IBM hardware.

When Roger asked IBM for a solution, IBM turned him down and accused Hercules of infringement of intellectual property rights. You can read Roger's summary of the initial exchange of letters with IBM here. The IBM letter I just published is IBM's reply to TurboHercules' request (made four months earlier) to specify which of IBM's intellectual property Hercules is allegedly infringing.

This proves that IBM's love for free and open source software ends where its business interests begin. In market segments where IBM has nothing to lose, open source comes in handy and the developer community is courted and cherished. In an area in which IBM generates massive revenues (the mainframe software alone has an estimated size of $25 billion -- twice as big as the Linux software market --, around $10billion for IBM, and IBM has a monopoly on mainframe hardware), any weapon will be brought into position against open source. Even patents, which represent to open source what nuclear arms are in the physical world.

Two of the patents had actually been pledged to the community

To add insult to injury, the list of patents with which IBM tries to intimidate the Hercules project even includes two of the 500 patents IBM originally "pledged" to the open source community.

Patent numbers U.S. 5613086 and U.S. 5220669 appear on page 4 of IBM's 2005 "patent pledge", and also appear as patents #83 and #106 in the letter IBM sent to TurboHercules.

This betrayal of the promise is unbelievable, but I never believed that IBM was sincere about that pledge in the first place.

When IBM made that announcement in 2005, I immediately viewed it as a deceitful attempt to kill two birds with one stone: to appease the FOSS community and to alleviate concerns by many European lawmakers who were opposed to a legislative proposal to enshrine software patents in European law (for more background on that process, see my initial post to this blog).

ZDNet and other media quoted me calling IBM "just being hypocritical". I stand by it. Five years later, I still can't find a better word to describe IBM's approach to open source.

Make no mistake: this is not about a simple commercial dispute between IBM and some other vendor. The patents in question, the largest group of which covers the IBM mainframe CPU instruction set, are not specifically connected to what the TurboHercules company is doing beyond the Hercules code base. That mainframe instruction set is emulated by the Hercules open source project itself, which started 11 years ago and has thousands of users worldwide, even including a number of IBM people. Other patents that IBM brings into position here cover general address management and virtualization/emulation functionality that would affect many other open source projects as well.

This is an attack on Free and Open Source Software as a whole. Unless IBM is stopped, other vendors might do the same to protect their turf.

If you read how IBM tries to justify its outrageous behavior, claiming that the Hercules folks are seeking a free ride, you'll see that we as a community face a fundamental problem.

Regulatory intervention against IBM is needed

So how can the current problem be solved? The only short-term fix that I can see -- other than IBM changing its stance -- is through regulatory intervention. IBM's mainframe monopoly is a huge problem. Customers who have invested trillions of dollars in mainframe infrastructure suffer from a lock-in and IBM doesn't even allow them to run the software they rightfully own on a platform of their choice.

Even prior to receiving that patent threat letter, TurboHercules had lodged a complaint with the European Commission. A formal investigation of IBM's conduct in this space, including (among other things) the way it uses its patent arsenal against an innovative open source program to prevent interoperability and customer choice, could ultimately open up the market and deter other monopolists from using their patent arsenals against open source in a similar way.

With all that's at stake, I'm now taking a really strong interest in this matter and will be following it more closely in the weeks and months ahead.

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