Newsmaker: Cyberpeace--of sorts--in our time

At first blush, they make a most unlikely pair: Novell's unassuming Ron Hovsepian and his opposite number at Microsoft, Steve Ballmer, who is Mr. Bluster personified.

But for now--and for the foreseeable future--these two chief executives are joined at the hip. Last week, Microsoft and Novell announced a broad marketing and patent pact that they said would smooth interoperability between the heretofore warring worlds of Windows and Linux.

When the two companies, which began their negotiations in April, sprang the surprise announcement, the industry reacted with a collective double take. Microsoft and Linux? But the agreement does not signal an end to the competition between Microsoft and Novell. Rather, the two companies say they negotiated the arrangement in response to pleas from software customers to make their lives easier. Increasingly, customers were telling both companies they wanted to run both Windows and Linux-based systems without technical hassles or the threat of being vulnerable to legal liability from intellectual property infringement claims.

Shortly after the two men appeared together to announce the deal at a San Francisco hotel, CNET News.com sat down with Ballmer and Hovsepian for an extended joint conversation.

What's the extent of the kumbaya that we saw on stage between the two of you?
Ballmer: Let me give you a way of thinking about it. Whatever you think the relationship has been between us and Unix, essentially we're able now to embrace a framework that is much more similar...It's a framework of competition: Windows competes with Unix, Windows competes with Linux. Linux is the popular form of Unix on Intel machines. We compete. And in a sense, that's the dominant theme for both of us.

In order to get a framework for interoperability, you need an intellectual property framework. An intellectual property framework with anything licensed under the GPL (General Public License), particularly, and anything that is not owned by anybody--there's nobody to "negotiate with" as the owner of the intellectual property. That presents new set of complexities. So in order to do interoperability, we needed some kind of IP framework.

The dream is that with interoperability, it's going to be easy for me to get his customers--and he's thinking the same thing.

--Steve Ballmer

What pushed you to find a way for Windows and Linux to interoperate?
Ballmer: Customers want (us) to. The dream is that with interoperability, it's going to be easy for me to get his customers--and he's thinking the same thing. Interoperability is both about the customer and it's also about a dream of increased market share on both sides.

The GPL is particularly unique, and the fact that nobody can negotiate on behalf of the creators of the intellectual property. As we've been soliciting customers' feedback and talking about our intellectual property concerns, they have steered us consistently to try to get this worked through with the distributor (of Linux).

Customers wanted somebody to speak on their behalf to bridge proprietary and open-source creation. We had thought a lot about the issue, but didn't know quite how to get there. When Ron came into his position, this was a great opportunity. Now we get intellectual property, which lets us get interoperability. It's like the next phase in the competitive landscape. It doesn't end the competitive landscape, but it does put it on what I call a less emotional, more traditional basis of who's got the better offering.

So does this mean you're really accepting open source?
Ballmer: What I am going say is that we're going to compete with a number of products, some of which come from commercial competitors and some of which come from the open-source community. The open-source community is also doing great innovations on top of Windows, which I'm very excited to see in a variety of different ways. But we compete with Linux. That doesn't change as a result.

I know our customers have Linux. It's not my job to accept or not accept. I'm going to try to tell them every day why Windows is a better choice, but when they make the choice to have Linux, I want it to interoperate with Windows. I want to provide that value, I want to use that interoperability as a source over time of other opportunities. But I need to do that in the framework in which the incredible investment we're making in patented intellectual property is protected.

You could have done this deal a year ago. Does this say anything about the depth of customer frustration?
Ballmer: This is a world in which you'd better be IT-compliant. Sarbanes-Oxley says, "You'd better be intellectual property-compliant, or you'll have an undisclosed liability." Nobody wants to have an undisclosed liability. Everybody wants to have peace of mind that they have proper rights to whatever it is they own. That's very important. This is a world in which compliance in all forms, not just in this form, is of greater importance.

One of the Linux community organizations has talked about the potential patent issues. And it's not like it's not out there. Customers are asking, "What am I doing about it? Microsoft, I consider this is as much your problem as it is Linux's problem. Fix it." That's the environment in which we live. Now, the fact that more and more people are moving off Linux onto Intel architecture, yeah, we are winning our fair share. But a lot of those customers are moving onto Linux on Intel architecture.

Hovsepian: We've seen that trend. I presented this scenario to our board more than a full year ago, as to this is where we see the market going. My elevation to this new role afforded me to have this conversation, and accelerate from where we started. If you just listen to the customers, they'll guide you. We've put a mechanism in place to bridge that. That's all that we're doing.

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