Beyond Binary

Microsoft has halted distribution of its Windows 7 USB/DVD Download tool after questions were raised as to whether the software utility makes improper use of open-source code. The tool is designed to help owners of Windows XP-based Netbooks get Windows 7 onto their machines.

(Credit: Microsoft)

Microsoft has halted distribution of a tool aimed at making it easier to put Windows 7 on Netbooks amid allegations that the utility makes improper use of open-source code.

The software maker said on Tuesday that it has pulled down the Windows USB/DVD Tool while it investigates the issue, which was raised last week by Windows blogger Rafael Rivera on his Within Windows blog.

In his blog post, Rivera said Microsoft appears to use code from a tool called ImageMaster that is licensed under the GPLv2 open-source license. The General Public License, like other open-source licenses, allows code to be freely used by others, but has its own set of terms and conditions, such as sharing any modifications made to the code.

Microsoft confirmed it has launched a review of the matter and taken the utility off its online Microsoft Store until that inquiry has been completed.

"Microsoft is looking into this issue and is taking down the (Windows 7 updating) tool from the Microsoft Store site until its review is complete," the company said in a statement. "We apologize to our customers for any inconvenience."

Though somewhat arcane, the utility is important because it solves a technical challenge in upgrading the operating system on Netbooks and other PCs without an optical drive.

Microsoft had been exploring for months different ways of trying to help users of Windows XP-based Netbooks move to Windows 7. The tool, which was released last month alongside Windows 7, allows users to take a downloadable copy of the operating system and create a bootable drive.

The issue is also a thorn in Microsoft's efforts to show that it can play nice with the open-source community. As ZDNet blogger Mary Jo Foley notes, this isn't the first time Microsoft has been accused of misusing GPL code.

The latest dust-up comes as Microsoft is celebrating the third anniversary of its deal with Novell, one of Microsoft's biggest--and most controversial--efforts to blend its world with the open-source world.

Under that deal, Microsoft agreed not to sue Novell customers for their use of its Linux distributions.

Microsoft has also released a number of products under various open-source licenses itself, though typically not under the GPL, which it sees as one of the more restrictive licenses. Redmond has been particularly critical of terms in version 3 of the GPL.

The software maker did release a few Linux drivers under GPLv2, although it appears its hand may have been forced there. Some have suggested the drivers contained GPL code, meaning that they would have necessarily needed to be released back under the GPL.

Microsoft has taken a number of different approaches to open-source software, particularly Linux. The software maker has at times accepted the notion of a heterogeneous world where Linux and Windows co-exist, pledging to do better to make sure IT administrators can manage mixed environments.

At other times, Microsoft executives have lashed out, painting open-source software as violating hundreds of Microsoft patents. In its lawsuit against TomTom earlier this year, Microsoft for the first time made those accusations in court, alleging that TomTom's implementation of Linux in its GPS systems infringed on Microsoft patents. The two companies quickly settled the matter, although terms were not disclosed.

It was only a matter of time, but the T-Mobile Sidekick issue has now spilled over to the courthouse.

A number of lawsuits have been filed, including two filed in federal court in Northern California on Wednesday that allege both negligence and false claims on the part of Microsoft and T-Mobile.

T-Mobile Sidekick LX

(Credit: CNET)

The suits come amid a massive outage of the service that powers the Sidekick, which has hampered data service since early this month and left many users without access to their calendars, address books, and other information. At one point, Microsoft and T-Mobile indicated that any data not yet recovered was probably lost permanently, however the companies said Monday that they were more optimistic about being able to bring back users' information.

One suit, filed on behalf of a Bakersfield, Calif., man "and all others similarly situated" charges that, among other things, Microsoft and Danger failed to use reasonable care in handling Sidekick owners data and that the Sidekick was falsely advertised. That suit seeks monetary damages as well as an order requiring the companies to fix the Sidekicks and service or offer a full refund.

"T-Mobile and its service providers ought to have been more careful the use of backup technology and policies to prevent such data loss" said Ira P. Rothken, an attorney working on that case. "We are hopeful that T-Mobile and the rest of the defendants will do the right thing, use this as an opportunity to redesign the system as a new standard for cloud computing storage, and provide full compensation for the data loss."

Another suit, filed on behalf of Maureen Thompson "and all others similarly situated" seeks unspecified damages for Thompson and others who have lost data as a result of the recent Sidekick problems.

According to her lawyer, Thompson owns a Sidekick used primarily by her daughter, an aspiring model, singer, and songwriter who used her Sidekick to store personal and business contacts, appointments, and even irreplaceable song lyrics not stored anywhere else. The lawyer said that Thompson bought the device "primarily because T-Mobile promised that any data would be protected and available no matter what happened to the phone."

"T-Mobile's initial efforts to reimburse Sidekick users are a step in the right direction, but fail to sufficiently compensate Sidekick users for this disastrous loss of data," Thompson attorney Jay Edelson said in a statement. "T-Mobile and Microsoft promised to safeguard the most important data their customers possess and then apparently failed to follow even the most basic data protection principles. What they did is unthinkable in this day and age."

In that lawsuit, Thompson's lawyers argue why the outage of the Sidekick was particularly devastating, noting the device's cloud-based architecture in which the primary copy of the data is stored, not on the devices, but on servers operated by Microsoft's Danger unit.

"Further complicating the data loss is the fact that Sidekicks, unlike iPhones, BlackBerrys and other smartphones, are not designed to sync locally with a user's personal computer without additional software and hardware," the suit states. "This means that most users were not able to backup their data locally, but were encouraged and required to rely on Microsoft/Danger."

Microsoft declined to comment on the lawsuit, but, a representative said on Wednesday that the company is "obviously very sorry for the inconvenience that this situation has caused Sidekick users, and we are working around the clock in an effort to recover and restore the data for any affected users. While it is still too early to say for sure, we announced on Monday that our engineering teams were increasingly optimistic."

For its part, T-Mobile said in a statement that it "does not comment on pending litigation."

"We are focused on helping our Sidekick customers recover from this recent service disruption and are continuing to support Microsoft's ongoing efforts to address and resolve the Danger platform issues," the company said.

T-Mobile has halted sales of the Sidekick amid the ongoing issues.

Microsoft's top lawyer said that a tentative agreement with Brussels announced earlier Wednesday could potentially allow the software maker to move out of the regulatory crosshairs, perhaps paving the way for regulators to shift their attention elsewhere.

"It's important for us to get closure in Europe on issues that have obviously been controversial for over a decade," General Counsel Brad Smith said in an interview. "Today's decision takes us an important step closer to doing that."

Smith

(Credit: Microsoft)

Microsoft initially took a much different approach to the European Commission's assertion that the inclusion of a browser in Windows violated antitrust law. The company had initially proposed just stripping out the browser from Windows 7 entirely, leaving users the prospect of trying to get a browser on their own. The software maker eventually backed down after indications that that approach was unlikely to fly.

While not final, Microsoft's moves would appear to resolve all of its outstanding regulatory issues with the Commission and were greeted warmly by regulators on Wednesday.

Although most of the early attention focused on the agreement around a browser "ballot screen," Microsoft also announced on Wednesday an agreement around product interoperability. Under that deal, a 10-year commitment by Microsoft, the software maker agrees to publish communication protocols and adopt certain standards as part of Windows, Windows Server, Office and other high market share products. Companies could also purchase for 5,000 euros a warranty that would subject Microsoft to court oversight and monetary penalties if it doesn't live up to its commitments.

Smith said that the approach Microsoft took with regard to interoperability was designed to adopt methods that Nellie Kroes, commissioner for competition, had outlined in a speech last year for how companies with high market share products should behave.

"I actually think this in effect implements the model that the Commission has been advocating," Smith said. Moreover, he said it is a model that other software companies should pay attention to, he said, noting that there are lots of companies that have high market share. He noted that Google has 78 percent of the paid search market and IBM has 100 percent of the mainframe market, while Adobe also has dominant positions in certain areas, such as Photoshop.

"It is important we believe to create a level legal and regulatory playing field," Smith said. "Everyone that has a high market share needs to respect the same set of rules. I think a number of these rules are likely to be applicable to other companies and other products."

Settling now with Brussels also could help Microsoft in its effort to win approval for its search deal with Yahoo, Smith said.

"This certainly isn't going to hurt when it comes to the Yahoo-Microsoft agreement," he said. "It's not necessarily going to make a huge difference. We didn't feel a particular step was needed to help it along."

Microsoft is in the process of trying to ascertain whether the deal needs approval from Brussels or from individual European antitrust authorities. It also needs approval from U.S. regulators, who have asked for more information on the deal.

European Union regulators said Wednesday that Microsoft can go ahead and start using its latest proposed "ballot screen," which will let new users of Windows choose which browser--or browsers--they wish to use.

The decision to let Microsoft "market test" the latest version would seem to mark the wrapping up of the latest antitrust skirmish with Brussels.

More than a decade after Microsoft first started including a browser with Windows, regulators said earlier this year that they had reached the preliminary view that such an inclusion violated European antitrust law.

In response, Microsoft initially said it would ship Windows 7 in Europe without a browser at all, seemingly challenging the logic of the decision by the European Commission, the executive arm of the EU. However, amid indications that such a move would not fly, Microsoft in July offered a proposal that more closely matched what regulators and competitors wanted--a ballot screen that lets users choose which browser or browsers they wish to install.

Since then Microsoft, regulators, and competitors have been going back and forth about how that screen would look and operate.

"The improvements that Microsoft has made to its proposal since July would ensure that consumers could make a free and fully informed choice of web browser," Europe's antitrust authority said in a statement. Among the changes since Microsoft's July proposal is the agreement by Microsoft to add more information before users select a browser. Microsoft will now first present users with a screen explaining what a browser is and will then offer "Tell me more" buttons for each browser.

Under the revised proposal, Microsoft would, through Windows Update, make available for five years in the European Economic Area a screen allowing users of Windows XP, Windows Vista, and Windows 7 to choose which Web browsers they want to install. PC makers will also be able to install competing Web browsers and, if they choose, set those as the default browser and disable Microsoft's Internet Explorer.

"The Commission's preliminary view is that Microsoft's commitments would address these competition concerns and is market testing Microsoft's proposal in light of these requirements," The EC said in its statement.

For its part, Microsoft said it welcomed the European Commission's decision.

"For Microsoft, today's decision is a significant step toward closing a decade-long chapter of competition law concerns in Europe," general counsel Brad Smith said in a statement.

Update: Smith also spoke to CNET about the deal and its potential impact on others in the industry. Click here to read that interview.

A federal court on Tuesday reversed an earlier ruling that Microsoft's product activation technology infringed on another company's patent, overturning a $388 million verdict in the case.

In a ruling on Tuesday, the court vacated the earlier decision and decided the case in Microsoft's favor.

"We are pleased that the court has vacated the jury verdict and entered judgment in favor of Microsoft," Microsoft spokesman Kevin Kutz said in a statement.

Tuesday's ruling is the latest twist in a case that has had plenty of them. Microsoft initially won a summary judgment ruling, which would have ended the case in its favor, but Uniloc appealed that ruling and a federal appeals court last year ruled that the case needed to go to trial with regard to two counts.

The victory in the Uniloc case comes as Microsoft is awaiting the result of an appeal in another patent case in which the custom XML feature in recent versions of Word was found to infringe on patents held by Canada's I4i. If it fails in its appeal bid, Microsoft faces damages of more than $200 million in that case as well as an injunction that would halt sales of word with the infringing feature.

A federal appeals court on Wednesday heard arguments over whether to uphold an injunction that would ban sales of Microsoft Word in its current form.

Microsoft is appealing a jury's ruling that a custom XML feature in recent versions of Word infringes on a patent held by I4i, a Canadian software company. The jury ordered Microsoft to pay $200 million, while a judge raised that amount and also issued the injunction, although it has been temporarily put on hold while Microsoft's appeal is being heard.

The hearing before a three-judge panel in Washington, D.C., lasted about 90 minutes, with lawyers from both sides making their case.

"At today's hearing we emphasized three points for why a reverse judgment or retrial is warranted: courts need to construct claims properly, the patent is not valid and we do not infringe it, and common sense can't be abandoned when it comes to damages calculation," Microsoft spokesman Kevin Kutz said in an e-mailed statement. "We are pleased with how the hearing proceeded and we look forward to the Court's ruling.

For its part, I4i said Microsoft's arguments are the same ones that have been unsuccessful in prior hearings.

"The good thing is there was nothing surprising," I4i Chairman Loudon Owen said in a telephone interview on Wednesday. "It was the same thing that failed at trial."

A ruling from the appeals court is expected soon, but no specific time frame was given by the court on Wednesday. I4i executives expressed hope that the ruling will come soon, but such decisions can often take two to four months, or even longer in some cases.

Should Microsoft lose its appeal, the software maker could also pursue a technical workaround that allows the custom XML function to work in a different way that doesn't infringe on I4i's patent, remove that feature from Word, or pursue a settlement.

Although XML technology may seem arcane, Owen said it is important technology and he said I4i is suffering each day that there is no injunction because the market is growing so quickly.

"It's not a 'would-like-to-have' (technology)," Owen said. "We believe it is a must-have going forward. This is infrastructure so that commerce and government can function and solves some of the problems that are seemingly insurmountable in managing data today."

Microsoft's board on Friday voted to give shareholders more say in how the software maker pays its executives.

The board of directors approved a plan that calls for a vote on the company's executive compensation every three years. However, under the board's plan, the vote will be advisory in nature.

The first of the advisory measures is set to be a part of this year's shareholder meeting, which takes place November 19.

"Given the interest in executive pay, we think it makes sense to encourage more dialogue with our shareholders on our compensation approach," Microsoft general counsel and board secretary Brad Smith said in a statement.

In theory, of course, shareholders could propose such votes more often, or submit other measures related to executive pay.

Unions, shareholder groups, and others have begun pressuring a number of large companies for greater say in how the companies pay their workers and executives. Microsoft said it worked with a number of its shareholders in developing its approach, including several entities that had submitted proposals related to this issue, such as Walden Asset Management, Calvert Investments, and the United Brotherhood of Carpenters.

"We believe that establishing an advisory vote on compensation is a significant step in providing shareholders a voice on this important issue," Calvert Group sustainability analyst Aditi Mohapatra said in a statement.

In 2008, Apple shareholders approved a non-binding resolution asking the board to give them greater input on executive compensation matters.

Aiming to crack down on a growing problem, Microsoft said it filed five lawsuits Thursday against parties it suspects of posting online advertisements laden with malicious code.

Microsoft has tried to work with ad networks to thwart such "malvertising" in the past, but this is the first time it has gone to court.

"Our filings in King County Superior Court in Seattle outline how we believe the defendants operated, but in general, malvertising works by camouflaging malicious code as harmless online advertisements," Microsoft Associate General Counsel Tim Cranton said in a blog posting.

In each case, Microsoft is suing the unknown parties responsible for the ads.

"Although we don't yet know the names of the specific individuals behind these acts, we are filing these cases to help uncover the people responsible and prevent them from continuing their exploits," Cranton said.

In the past week, The New York Times' Web site was hit with a rogue advertisement that told readers that their computer may be infected with a virus and redirected them to a site that purports to offer antivirus software.

"Scareware is often distributed among criminals, which therefore results in many of the animations a user may see utilizing a common design and interface," a Microsoft told CNET News. "However, without additional information and specific details about the attacks, we cannot be certain that any of today's filings directly relate to the attacks on The New York Times' Web site."

Microsoft likened the latest lawsuits to prior legal action that it has taken against those suspected of click fraud or instant messaging spam.

"This work is vitally important because online advertising helps keep the Internet up and running," Cranton said. "It's the fuel that drives search technologies. It pays for free online services like Windows Live, Facebook, Yahoo, and MSN. Fraud and malicious abuse of online ad platforms are therefore a serious threat to the industry and for all consumers and businesses that rely on these free services."

A pro-open-source group said on Tuesday that it has acquired 22 patents recently sold by Microsoft--patents that the group said could have been used against Linux.

The Open Invention Network said that the patents were purchased from Microsoft by an entity known as the Allied Security Trust. OIN said it has now acquired the patents from AST, although it wouldn't say how much it paid.

"Today's announcement evidences OIN's continued commitment to acquire patents that may be relevant to Linux," OIN CEO Keith Bergelt said in a statement. "The prospect of these patents being placed in the hands of non-practicing entities was a threat that has been averted with these purchases, irrespective of patent quality and whether or not the patents truly read on Linux."

Allied Security Trust said it was pleased that OIN had bought the patents. "OIN's purchase ensures that these important patents will not be used by patent trolls or others seeking to disrupt Linux and the many companies and individuals advancing this important technology," AST Chief Executive Dan McCurdy said in a statement.

The Wall Street Journal reported on Monday that OIN was close to acquiring the former Microsoft patents.

In an interview, Bergelt said that his organization was not invited by Microsoft to directly participate in the bidding for the patents, raising the specter that Microsoft was more interested in selling to someone that might have targeted Linux as opposed to just maximizing the sales price for the patents.

"We were not offered an opportunity to participate in the bidding for this portfolio that Microsoft was selling," Bergelt said.

For its part, Microsoft confirmed that it sold the patents to AST in July, but declined to comment on the terms of the deal. Microsoft said that the patents were indeed ones that it had acquired several years ago in a deal with SGI.

"These patents were deemed to be non-core to our business and non-essential for our IP portfolio," Microsoft spokesman Michael Marinello said in a statement. "When an interested buyer for this technology was identified, after discussing it both internally and with the potential buyer, we felt this was the right direction to go in relating to these specific patents."

OIN began in 2005 and includes IBM, Sony, Red Hat and Google among its members. TomTom joined OIN earlier this year, during its now-settled patent spat with Microsoft.

Microsoft has long asserted that various implementations of Linux infringe on a number of its patents, however, until its suit against TomTom, Microsoft had never litigated any of those contentions. Linux-related claims were part of Microsoft's suit against TomTom.

Bergelt said OIN acquired the patents to try to help Linux-based companies avoid becoming targets for more legal action. "In this case it's not that we saw these patents as so fundamental that Linux was at risk," Bergelt said. "Our goal is to reduce the potential challenges that are associated with patents."