May 22, 2006 12:09 PM PDT

Collision course for Symantec and Microsoft

Symantec's trade secret lawsuit against Microsoft is a sign of heightened competition between the two companies, but it's not a declaration of war, analysts said.

Last week, Symantec sued Microsoft, accusing it of misappropriating intellectual property related to data storage technology. It is the first time that the Cupertino, Calif.-based security specialist and the software giant have been on opposite sides in a legal case. In the past, the companies have teamed up to take software pirates to court.

"The relationship has definitely shifted from collaboration to 'coopetition' and, in some cases, to outright competition," said Andrew Jaquith, an analyst at Yankee Group Research. (Coopetition is a mixture of cooperation and competition.)

Symantec is asking a court to bar Microsoft from further developing, selling or distributing software, including Windows Vista and Windows Server "Longhorn," until all of Symantec's intellectual property is removed. Microsoft has described Vista as one of the most important Windows releases in its history.

"Symantec has everything to gain by any potential delay in Microsoft shipping Vista," Gartner analyst John Pescatore said. Vista, slated to be broadly available in January, includes spyware protection, a much-improved firewall and new backup tools--areas in which Symantec sells products, especially to consumers.

The waters between the companies have been muddied ever since Microsoft announced three years ago that it was entering the security space. But Symantec CEO John Thompson has repeatedly said his company won't compete by going to court or complaining to antitrust regulators. Thompson said it would instead rely on its security wits and reputation to beat Microsoft.

That hasn't changed, said Michael Cherry, an analyst at research firm Directions on Microsoft. The lawsuit is over a contract dispute that Symantec inherited when it acquired Veritas Software, he noted.

"Symantec owes it to its shareholders to vigorously protect its intellectual property. I don't think there is a wider significance to this," Cherry said.

The complaint involves Symantec's Volume Manager product, which allows operating systems to store and manipulate large amounts of data. Microsoft licensed a "light" version of Volume Manager from Veritas in 1996. In its lawsuit, Symantec accuses Microsoft of violating the license.

Symantec is conservative, legally speaking, Jaquith said. "In the areas where they compete, such as anti-spyware, Symantec won't be afraid to pull the legal trigger if they feel they need to," he said. "But Symantec will never be confused with SCO. Legal maneuvers will supplement their strategy, not substitute for one."

SCO Group has been involved over the past few years in a legal campaign targeting Linux customers and vendors. The company has claimed that some Linux software includes source code from Unix, which it controls. In June 2003, for example, it launched a related intellectual-property suit against IBM, seeking $3 billion in damages.

The analysts agreed that Symantec would not have brought this action if it had not felt sure that it had a case and there was no other way to resolve the dispute. "I don't believe Symantec is the type of company that tries to compete via litigation," Pescatore said.

The courtroom opponents say they continue to have great relations, Jaquith said. As Symantec put it last week, the companies "agreed to disagree" and take the Volume Manager dispute to court for a resolution.

But with Microsoft branching out into security products and continuing its push into the data center, there are bound to be more collisions between the world's biggest software vendor and smaller players, Cherry said.

"This is probably not the first, nor is it the last, of the lawsuits we're going to see, as the lines of the utility vendors and the operating-system vendors keep butting up against each other," he said.

See more CNET content tagged:
Symantec Corp., intellectual property, SCO Group Inc., VERITAS Software Corp., lawsuit

26 comments

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Not an all out declaration of war!!??
If its not an "all out declaration of war"? Why is this story labelled
high impact??

Truth is Microsoft has been facing these battle for years with other
companies. Whats so significant about it?
Posted by ServedUp (413 comments )
Reply Link Flag
Vista might be delayed... again
I think the most important fact in this article is that if Symantec wins, Vista will be delayed again.
Posted by alexy.la (2 comments )
Link Flag
Not an all out declaration of war!!??
If its not an "all out declaration of war"? Why is this story labelled
high impact??

Truth is Microsoft has been facing these battle for years with other
companies. Whats so significant about it?
Posted by ServedUp (413 comments )
Reply Link Flag
Vista might be delayed... again
I think the most important fact in this article is that if Symantec wins, Vista will be delayed again.
Posted by alexy.la (2 comments )
Link Flag
Symantec
If Symantec wins, and gets some money, I hope they use it to hire some decent programmers and architects. Their current software offerings are atrocious. AVG is free and actually works.
Posted by als (154 comments )
Reply Link Flag
Avast! is even better...
... and has automatic updates even in the free version... (www.avast.com)
Posted by aemarques (162 comments )
Link Flag
Symantec
If Symantec wins, and gets some money, I hope they use it to hire some decent programmers and architects. Their current software offerings are atrocious. AVG is free and actually works.
Posted by als (154 comments )
Reply Link Flag
Avast! is even better...
... and has automatic updates even in the free version... (www.avast.com)
Posted by aemarques (162 comments )
Link Flag
Beware the term "shareholders"
Shareholders, NOT customers, are the primary focus of all public companies these days. By putting the breaks on Vista, the shareholders have everything to gain and Microsoft and consumers have everything to lose. Granted, Vista is not at all what it was promised to be and not a very compelling reason for most people to upgrade but anything would be an improvement over what most consumers have today. Most consumers have no clue what AntiVirus and AntiSpyware software is and even if they do, the majority of those software packages sit unused with definitions so out of date that they are pretty much useless. The integrated security in Vista is not perfect but it will be better than nothing for clueless consumers.

Companies have truly lost their focus on the customer. The only thing that matters anymore is the shareholder's opinion. Which, usually, are so far removed from reality that they couldn't be more wrong. We as customers must start hitting the companies where it hurts to be recognized. Screw the shareholders, they are morons. Customers are the life blood of all companies. It is time for companies to start recognizing that.
Posted by thenet411 (415 comments )
Reply Link Flag
I agree
Dell is a good example, and that is why they find themselves in trouble today. Outsourcing support, to squeeze out every last penny possible, has apparently compacted their once loyal customer base.

<a class="jive-link-external" href="http://www.ihatedell.net/forum/phpBB2/index.php?sid=0293e540a038c740cac3d51304c5d189" target="_newWindow">http://www.ihatedell.net/forum/phpBB2/index.php?sid=0293e540a038c740cac3d51304c5d189</a>

The customer should always come first, if you want to be successful.
Posted by als (154 comments )
Link Flag
Tyco is reminate to these still waters of who can price earnings.
Consumers play little stake in an actively (GNP) productive market at all levels. More in the past ten years do the ever reducing ratio of providers vs. consumers.

As in the Microsoft experience however nothing is any different than their regular course of doing business as ussual; based on their price per earnings on the exchange, also, the gigantic vested executive interior holding the companies wealth.

Satellite partners are always welcome to put a stake in the lanscape in cyberspace.(???!)
Posted by Stalin Hornsby (60 comments )
Link Flag
Beware the term "shareholders"
Shareholders, NOT customers, are the primary focus of all public companies these days. By putting the breaks on Vista, the shareholders have everything to gain and Microsoft and consumers have everything to lose. Granted, Vista is not at all what it was promised to be and not a very compelling reason for most people to upgrade but anything would be an improvement over what most consumers have today. Most consumers have no clue what AntiVirus and AntiSpyware software is and even if they do, the majority of those software packages sit unused with definitions so out of date that they are pretty much useless. The integrated security in Vista is not perfect but it will be better than nothing for clueless consumers.

Companies have truly lost their focus on the customer. The only thing that matters anymore is the shareholder's opinion. Which, usually, are so far removed from reality that they couldn't be more wrong. We as customers must start hitting the companies where it hurts to be recognized. Screw the shareholders, they are morons. Customers are the life blood of all companies. It is time for companies to start recognizing that.
Posted by thenet411 (415 comments )
Reply Link Flag
I agree
Dell is a good example, and that is why they find themselves in trouble today. Outsourcing support, to squeeze out every last penny possible, has apparently compacted their once loyal customer base.

<a class="jive-link-external" href="http://www.ihatedell.net/forum/phpBB2/index.php?sid=0293e540a038c740cac3d51304c5d189" target="_newWindow">http://www.ihatedell.net/forum/phpBB2/index.php?sid=0293e540a038c740cac3d51304c5d189</a>

The customer should always come first, if you want to be successful.
Posted by als (154 comments )
Link Flag
Tyco is reminate to these still waters of who can price earnings.
Consumers play little stake in an actively (GNP) productive market at all levels. More in the past ten years do the ever reducing ratio of providers vs. consumers.

As in the Microsoft experience however nothing is any different than their regular course of doing business as ussual; based on their price per earnings on the exchange, also, the gigantic vested executive interior holding the companies wealth.

Satellite partners are always welcome to put a stake in the lanscape in cyberspace.(???!)
Posted by Stalin Hornsby (60 comments )
Link Flag
Symantec doesn't care about customers, only stock price
Don't take my word for it; simply attempt to install a Norton 2006 product over a Norton 2005 product. There is a very high probability that your attempt will be unsuccessful, and Norton 2006 will not work. (Great, another call to tech support!) And this is straight out of the box, no special configuration.

There is a similarly high likelihood that after the failed install, Norton 2005 won't work either. It appears that there are teams of people at Symantec who are dead set on making customers' lives miserable.

Symantec's number 1 priority is raising its stock price to avoid another shareholder revolt (harkening back to the 25% share price decrease last year). If the company needs to put innovation on the back burner and sue everyone in the country in order to raise the stock price, that is what they will do. Norton customers be damned.
Posted by The Harper (41 comments )
Reply Link Flag
Symantec doesn't care about customers, only stock price
Don't take my word for it; simply attempt to install a Norton 2006 product over a Norton 2005 product. There is a very high probability that your attempt will be unsuccessful, and Norton 2006 will not work. (Great, another call to tech support!) And this is straight out of the box, no special configuration.

There is a similarly high likelihood that after the failed install, Norton 2005 won't work either. It appears that there are teams of people at Symantec who are dead set on making customers' lives miserable.

Symantec's number 1 priority is raising its stock price to avoid another shareholder revolt (harkening back to the 25% share price decrease last year). If the company needs to put innovation on the back burner and sue everyone in the country in order to raise the stock price, that is what they will do. Norton customers be damned.
Posted by The Harper (41 comments )
Reply Link Flag
Typical Press Hype
Even though the article explicitly states that this lawsuit is about code which Symantec acquited from Veritas, the article hypes it, making it look like Symantec is suing Microsoft because of all the security-related stuff in Vista. Typical editorial stupidity.
Posted by JohnWSaundersIII (15 comments )
Reply Link Flag
Typical Press Hype
Even though the article explicitly states that this lawsuit is about code which Symantec acquited from Veritas, the article hypes it, making it look like Symantec is suing Microsoft because of all the security-related stuff in Vista. Typical editorial stupidity.
Posted by JohnWSaundersIII (15 comments )
Reply Link Flag
In this case I have to side with...
Microsoft! I mean when you think about it the OS should ship with all the security features on and activated for all of those novices who have no idea what a firewall or spyware is. Now for the current dispute over volume manager, what does symantec honestly have to gain?!?! You guessed it, they get to delay the security features in vista, and keep selling their overpriced virus and spyware softare.
Posted by andya (10 comments )
Reply Link Flag
In this case I have to side with...
Microsoft! I mean when you think about it the OS should ship with all the security features on and activated for all of those novices who have no idea what a firewall or spyware is. Now for the current dispute over volume manager, what does symantec honestly have to gain?!?! You guessed it, they get to delay the security features in vista, and keep selling their overpriced virus and spyware softare.
Posted by andya (10 comments )
Reply Link Flag
Symantec its own worst enemy
Symantec's time might be better spent resolving conflicts in its Live Update procedures between its corporate and single-user products. I've found it impossible to add my own single-user tools after installing its corporate anti-virus editions. Symantec is deaf to its users, so I suppose they are still in the dark about this....
Posted by aldiviva (3 comments )
Reply Link Flag
Symantec its own worst enemy
Symantec's time might be better spent resolving conflicts in its Live Update procedures between its corporate and single-user products. I've found it impossible to add my own single-user tools after installing its corporate anti-virus editions. Symantec is deaf to its users, so I suppose they are still in the dark about this....
Posted by aldiviva (3 comments )
Reply Link Flag
Better of two evils... (* GRIN *)
It's hard to tell the difference between good and evil, but what's difficult is finding the lesser of two evils.

But in this case... as much as I dislike Symantec's CPU Hogging programs, I wish them luck as they are easily the lesser of two evils.

FWIW
Posted by wbenton (522 comments )
Reply Link Flag
Better of two evils... (* GRIN *)
It's hard to tell the difference between good and evil, but what's difficult is finding the lesser of two evils.

But in this case... as much as I dislike Symantec's CPU Hogging programs, I wish them luck as they are easily the lesser of two evils.

FWIW
Posted by wbenton (522 comments )
Reply Link Flag
 

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