Nokia Acquires Trolltech, Continuing the Trend of Greater Involvment of Traditional Software Companies in Open Source

Nokia announced that it will be acquiring Trolltech. This acquisition continues a trend of traditional software companies becoming active in using open source software and business models. For example, Citrix acquired Xensource and Yahoo acquired Zimbra. Consistant with this trend, Nokia provided the following explanation:

"The technology landscape evolves and, for Nokia, software plays a major role in our growth strategy for devices, PCs and the integration with the Internet. We continue to focus on areas where we can differentiate and add more value. Common cross-platform layers on top of our software platforms attract innovation and enable Web 2.0 technologies in the mobile space," said Kai Oistamo, Executive Vice President, Devices, Nokia. "Trolltech's deep understanding of open source software and its strong technology assets will enable both Nokia and others to innovate on our device platforms while reducing time-to-market. This acquisition will also further increase the competitiveness of S60 and Series 40."

http://money.cnn.com/news/newsfeeds/articles/prnewswire/UKM00728012008-1.htm


Traditional software companies understand that open source is a very powerful force in the software industry, a view confirmed by several recent reports on the penetration of open source software. Dennis Byron, the anaylst, summarized these reports very effectively in his post http://www.ebizq.net/topics/open_source/features/8842.html?page=1. He notes that according IDC open source software revenue in 2006 was $1.8 billion (about 1% of all software revenue), but has a growth rate three times the growth rate of traditional software. He also provides a very useful discussion of the difficulty of measuring the growth of open source software.

These reports are consistant with Gartner's report last year: Gartner declared open-source software "the biggest disruptor the software industry [Gartner] has ever seen and [Gartner] postulated it will eventually result in cheaper software and new business models." They stated that open-source products accounted for a 13 percent share of the $92.7 billion software market in 2006, but should account for 27 percent of the market in 2011 when revenue is expected to be $169.2 billion, according to Gartner research. http://lawandlifesiliconvalley.blogspot.com/2007/09/open-source-paradigm-shift.html. IDC has estimated that open source revenues will increase to $5.8 billion in 2011, which represents an annual growth rate of 26 percent from 2006 to 2011.

Byron's conclusion is that open source and closed source models are converging and that over time software users will be more concerned about functionality and price rather than "open source" or proprietary. http://www.ebizq.net/topics/open_source/features/8842.html?page=5. This conclusion is consistent with the results from our 2007 Open Source Think Tank http://thinktank.olliancegroup.com/index.php?option=com_content&task=view&id=34&Itemid=61 (We will be holding our Third Annual Open Source Think Tank next week and you may find out more about this invitation only event athttp://lawandlifesiliconvalley.blogspot.com/2008/01/thinking-forward-on-commercial-open.html)

Open source has entered the mainstream and needs to be part of the strategy of all software companies.

Free Software Foundation Announces Final Affero General Public License

One of the most contentious issues during the drafting of the General Public License Version 3 was whether to add an obligation to make source code available for software licensed under GPLv3 if it was provided over a network. The GPLv2 only required source code to be provided upon the "distribution" of the program (although the Affero project, with the permission of the Free Software Foundation, developed a version of GPLv2 which included a requirement to make the source code available to any user of a network, rather than just upon distribution). With the rise of service providers such as Google, open source software was being modified and used, but the modifications were not being made available to the community.

Ultimately, the FSF decided not to include such a requirement in GPLv3 but provide this option through an alternative license, the Affero GPL. It also made the GPLv3 "compatible" with the Affero GPL in Section 13 of the GPLv3. This compatability is "hardwired" rather than a natural result of changes to the GPLv3 which permitted compatability with Apache. And the compatability is "one way": GPLv3 licensed code can be linked with or combined with works licensed under the Affero GPL, but works licensed under the Affero GPL cannot be licensed under the GPLv3.

The final version of the Affero GPL is not surprising. It includes the "network use" language which requires that the Corresponding Source of the Affero GPL licensed code (as well as any GPLv3 licensed code which is incorporated into it) be made available to any network user. The critical provision is as follows:


13. Remote Network Interaction; Use with the GNU General Public License.
Notwithstanding any other provision of this License, if you modify the
Program, your modified version must prominently offer all users
interacting with it remotely through a computer network (if your version
supports such interaction) an opportunity to receive the Corresponding
Source of your version by providing access to the Corresponding Source
from a network server at no charge, through some standard or customary
means of facilitating copying of software. This Corresponding Source
shall include the Corresponding Source for any work covered by version 3
of the GNU General Public License that is incorporated pursuant to the
following paragraph.

Notwithstanding any other provision of this License, you have permission
to link or combine any covered work with a work licensed under version 3
of the GNU General Public License into a single combined work, and to
convey the resulting work. The terms of this License will continue to
apply to the part which is the covered work, but the work with which it is
combined will remain governed by version 3 of the GNU General Public
License.


The Affero GPL is an important option for companies or projects that are concerned that they will be used to provide services, but the service providers will not provide their modifications to the community. This issue can be important for a company: I worked with Socialtext to develop the Common Public Attribution License which included a network use provision and a very explicit attribution provision. This option may become more popular as more software is provided as a service. I still believe that the GPLv3 will continue to be much more widely used than the Affero GPL. In fact, I have a small bet with Fabrizio Capobianco, CEO of Funambol, that GPLv3 will continue to beat out Affero GPL over the next five years, so keep adopting GPLv3!

The Software Freedom Law Center Files First Enforcement Action for General Public License

On September 20, the Software Freedom Law Center has filed the first lawsuit to enforce the General Public License version 2 in the United States ("GPLv2"). The GPLv2 continues to be the most widely used open source license: more than 65% of the projects on SourceForge use it.

The plaintiffs, Erik Andersen and Rob Landley, sued Monsoon Multimedia, Inc. for copyright infringement of the BusyBox software in the Southern District of New York. The complaint can be found at http://www.softwarefreedom.org/news/2007/sep/20/busybox/complaint.pdf. The plaintiffs allege that Monsoon Multimedia distributed their program as part of their firmware, but did not make the source code available.

This case is very important because it will establish what type of remedies (either contract or copyright) are available to licensors for breach of the GPLv2. The Free Software Foundation has consistantly taken the position that the GPLv2 is a copyright license rather than a contract and that the failure to comply with its terms results in copyright infringement.

I don't agree with the view that the GPLv2 is not a contract (see below for the significance of this distinction), because the GPLv2 includes many provisions such as a disclaimer of warranty which are characteristic of "contracts" for the sale of goods under Article 2 of the Uniform Commercial Code. This distinction could be important as illustrated in the recent decision in Jacobsen (see above) which provided that the remedy for the breach of the Artistic License was in contract (i.e. monetary damages) and not copyright infringement. The major difference in remedies is that contract remedies are generally monetary damages, but copyright remedies are generally injunctive relief (the court orders a party to do something) as well as monetary damages. Clearly, open source licensors would prefer to obtain injunctive relief to require the licensee to comply with the terms of the license.

However, the court's decision on remedies will not turn solely on whether the GPLv2 is a copyright license or a contract: even if the court finds that the GPLv2 is a "contract", it could also find that the breach of the GPLv2 results in copyright infringement (see the Jacobsen case blog for an explanation of this issue). The GPLv2 is very different from the Artistic License so the reasoning in the Jacobsen case may not apply. However, courts are very influenced by the decisions of other courts in new areas which is why the wrong decision in the Jacobsen case is so important.

Stay tuned, this case will be very important for the future of open source software.

New Open Source License: Common Public Attribution License

I am proud to announce that the Socialtext Common Public Attribution License was approved by the OSI board on Wednesday morning. It will be the only OSI approved license that includes a provision enabling attribution and "filling" the ASP hole. The license is designed as a template for use by other companies and Socialtext and I believe that this license will fill an important need for open source companies.

The attribution provision was quite controversial and the license went through many drafts in order to satisfy those concerns. Many open source application companies have felt the need for an attribution notice: more than fifteen have adopted the MPL + attribution first used by SugarCRM, so the approval of this license is quite important to them. The participants on License Discuss at OSI were very opposed to the initial proposal on attribution. However, we and Socialtext worked with the members of License Discuss, the OSI Board as well as other members of the community to modify the provisions to meet these concerns. The real hero of the story is Ross Mayfield, CEO of Socialtext, whose patience and persistence during the eight month process were critical to its success. http://www.socialtext.com/node/267.


The license is based on the Mozilla Public License Version 1.1 but Sections 14 and 15 have been added to provide for limited attribution for the Original Developer and cover use of software over a computer network. The attribution provision in Section 14 permits an attribution notice with the following information: copyright notice, short phrase (10 words), graphic image and URL. The network use provision in Section 15 is based on the "external deployment" approach (rather than the Affero approach) and requires that a company that makes the software available over a network (such as providing service as an ASP) provide the source code to persons who use such application over the network.

I realize that I may be biased, but I encourage companies to consider using the CPAL.

Adoption of General Public License Version 3: Keeping Track

One of the major questions in the open source community is whether projects will adopt the General Public License Version 3. Although I have stated in my previous post that the GPLv3 has significant advantages over GPLv2, inertia is tough to overcome. We have no prior history on this question because, in the past, projects did not have a choice between different versions of the General Public License. One challenge in answering this question is tracking these conversions because the information is very dispersed. Fortunately, Palamida, the software management firm, is now tracking these conversions on their website: http://gpl3.palamida.com/.



They count 116 conversions in the first week after the release of GPLv3. However, because this first week included July 4th, it may not be representative. Thanks to Palamida for making it easier to track these changes.

General Public License Version 3: A Legal View

The final version of the General Public License Version 3 (“GPLv3) published on June 29th is a significant improvement over General Public License Version 2 (“GPLv2”) and deserves to have broad acceptance. In fairness to GPLv2, the GPLv2 was drafted in 1991: both the law relating to software and the manner in which software is developed and distributed has changed significantly since 1991. I was actively involved in the process as the Chair of Committee C, the committee representing users, and it is very satisfying that the hard work of the Free Software Foundation, Committee C and the other committees has reached such a successful conclusion (even though not all of our suggestions were accepted).

The process of drafting the GPLv3 has been a remarkably open one: the Free Software Foundation used four committees representing different constituencies from vendors to users to developers to focus comments while at the same time permitting anyone to comment on the drafts through their website. I have been practicing for over 25 years and in my experience this approach is unique. The result has been a significant improvement from the initial drafts and the FSF deserves credit for listening to constituencies beyond the free software community.

My perspective is formed by my legal practice: as noted in my biography, I work primarily with corporate clients from global corporations to Silicon Valley startups. I believe that the option of using the GPLv3 will be valuable to both corporations and developers. Because corporations are the largest users of software, their understanding and comfort with the terms of free and open source software (“FOSS”) licenses is important to the continuing success of FOSS.

The final version includes clarifications of existing issues in the GPLv2 as well as provisions dealing with new issues. The major differences between GPLv2 and GPLv3 are as follows:

1. Clarifying the Scope of GPLv3. The scope of the GPL license is one of the most critical issues for both vendor and users. The GPLv2 relied on United States copyright law for many of its critical definitions. Although the GPLv3 continues to use copyright as the basis for defining the scope of the license it is no longer based solely on United States copyright law. The GPLv3 has also clarified several important issues: for example, does “making the software available” (such as through an ASP) trigger the “copyleft” obligations of the GPLv3 (which include making source code available to licensees)? The GPLv3 clearly states no. Similarly, running the program and making modifications that licensee does not share do not trigger these obligations. Another important change is the deletion of the use of “collective work” in GPLv2: this term is defined in US copyright law as “a work, such as a periodical issue, anthology, or encyclopedia, in which a number of contributions, constituting separate and independent works in themselves, are assembled into a collective whole.” This definition is difficult to apply to software and this ambiguity was a major source of concern about the interpretation of GPLv2.

2. Patents. The GPLv2 did not deal directly with patent licenses because software patents were very rare when it was drafted in 1991. However, software patents have become very common in the software industry in the United States and, thus, the lack of a patent license in GPLv2 created serious ambiguities about its scope. Although the FSF had taken a position that the GPLv2 provided an “implied” patent license, the position was controversial. The GPLv3 grants a direct patent license by companies who contribute (rather than merely distribute) the work. The GPLv3 also includes other provisions relating to patents to prevent another transaction similar to the Microsoft/Novell deal.

3. Expanded Compatibility. The inability to use FOSS programs together which are licensed under different FOSS licenses remains one of the major challenges to the success of FOSS. One of the major disadvantages of GPLv2 is that the software licensed under GPLv2 cannot be used with software licensed under most other major FOSS licenses. GPLv3 is specifically designed to broaden the number of licenses with which it is compatible. Most importantly, works licensed under the Apache Public License (“APL”) can be licensed under GPLv3 (although GPLv3 licensed software may not be licensed under the APL). GPLv3 licensed software can also be used with software licensed under the Affero General Public License which closes the “ASP hole” (see Section 9).

4. Broadened Scope of Works. The GPLv2 was limited to only programs. Although Sun Microsystems, Inc. was able to use the GPLv2 to license the RTL code for its SPARC chip, the GPLv2 was not designed for use with other types of works. The GPLv3 is much broader: it applies to any “copyrightable work” which ranges from software to documentation to music. It also expressly applies to “mask works” (which are the legal protection for the three dimensional design of semiconductors).

5. Termination. The GPLv2 terminated automatically upon failure to comply with its terms and continued use of the program was copyright infringement. GPLv2 did not address how to reinstate the rights under the license after coming back into compliance. This provision was particularly troubling as GPLv2 licensed software was used in consumer products such as television sets and computers which are sold in millions of units: even an inadvertent breach could result in massive liability for copyright infringement. The GPLv3 directly addresses this issue in Section 8. Although it continues to provide for automatic termination, it now includes a procedure for reinstatement.

6. Modification of Software for Consumer Products. This provision has received little comment, but could have an enormous impact. It requires that any consumer product which uses software licensed under the GPLv3 must “open up” the software. Frequently referred to as the “anti-Tivo” provision, it applies to products which are normally used for personal, family or household purposes as well as anything designed or sold for incorporation into a dwelling. Such consumer products range from the expected, such as televisions and stereos, to the surprising such as automobiles and home security systems. Section 6 requires that the vendor provide the source code as well as “Installation Information” for such software. Installation Information includes methods, procedures, authorization keys and other information required to install and execute modified versions of the software. The only exception is for software for which neither the vendor nor a third party can install modified software. This exception is likely to be very limited. The provision also provides the vendor with options relating to warranties and connection to a network in dealing with such modified software.

7. Limitations on Digital Rights Management. The GPLv3 reflects the FSF’s hostility to DRM. Section 5 prohibits the use of software licensed under the GPLv3 to implement DRM (referred to as “effective technological measures” to conform to the provisions of the relevant WIPO treaty). In addition, it requires a user of GPLv3 licensed software to waive his rights under the Digital Millennium Copyright Act and similar laws arising from the WIPO treaty to protect such works by using “anti-circumvention” technology.

8. Use of Contractors. One of the major changes in the software business since 1991 has been the increase in outsourcing of software development, either by independent contractors or outsourcing firms. Under the GPLv2 the transfer of a copy of the software to the independent consultant or outsourcing firm was a “distribution” and, thus, theoretically could permit the independent contractor or outsourcing firm to further distribute the software in both source code and object code form. GPLv3 resolves this issue in Section 2 by permitting a company to provide copies of the work to a third party to make modifications solely for the company.

9. Application Service Provider (“ASP). One of the significant issues in drafting the GPLv3 was the treatment of a new method of making software functions available: companies that do not “distribute” software, but rather make it available as a service (called an Application Service Provider). Since no distribution occurs, these companies do not have to comply with the “copyleft” provisions of the GPL such as making their source code available to their licensees. This problem was referred to as the “ASP hole.” This issue was not addressed in GPLv2 because this method of distribution did not exist in 1991. After considering several approaches, the FSF chose to provide an alternative license for those who wished to address this issue: the Affero General Public License (“AGPL”). The AGPL includes a provision requiring that companies providing services over a network make the source code available to users of the services (just as if the companies had distributed a copy of the software under the GPLv3) based on the well known “Affero” modification to the GPLv2. The GPLv3 also permits AGPL licensed software to “link” to GPLv3 licensed software, but does not permit the AGPL licensed software to be distributed under the GPLv3.

10. Additional Terms. The GPLv2 did not permit any modification of its terms which led to incompatibility with other FOSS licenses and potential problems in countries other than the United States where the wording of disclaimers and limitation of liability required to eliminate warranties and limit liability may differ from the United States. In Section 7, the GPLv3 permits limited modifications in these terms which will help solve these problems. In addition to making the GPLv3 compatible with the APL and permitting modified disclaimers of warranties and limitations, the provision permits adding limited attribution information (an approach which is being used by about twenty companies but using the Mozilla Public License as the basis) and various provisions to protect the use of trademarks and personal names.

I believe that the GPLv3 is a very valuable addition to FOSS licenses and solves many of the challenges faced by GPLv2. Companies distributing FOSS should consider it and companies using FOSS should be prepared, in most cases, to accept it.