Open Software Initiative Submitted Complaint About Novell/CPTN Patent Deal with German Antitrust Authority ("Bundeskartellamt")

The Open Software Initiative (OSI) is a non-profit organisation whose mission is to "educate about and advocate for the benefits of open source" that is particularly concerned about 822 Novell patents that are confirmed to be sold to CPTN Holdings LLC for $450 million in cash, in the course of Novell's merger into Seattle-based software company Attachmate Corporation (see press release). CPTN Holdings LLC, which has first been described as a "consortium organized by Microsoft", turned out to be a joint venture of the four software heavyweights Microsoft, Apple, EMC, and Oracle from a "notified merger project" (Ref no. B5-148/10 of 06.12.2010; product market: "patents") announced by the German "Bundeskartellamt" (Federal Cartel Office, FCO), as reported on FOSS Patents. Like every patent issue involving names like Microsoft, Apple, or Oracle, also this deal receives much attention from the IT community. For instance, John Paczkowski of the All Things Digital blog found it "intriguing" and CPTN an "unusual alliance", while speculating that the - up to now undisclosed - patents relate to networking, virtualization and data center technologies. Apparently, a source inside one of the four companies told him that "it was essentially an alliance of convenience" and "it’s cheap defensive insurance". As to the deal itself, Glyn Moody, an influential technology journalist and Linux/open source advocate, analysed that "if the sale itself is no surprise, the buyer is", since "many had expected VMware to pick up the company" and referred to Steven J. Vaughan-Nichols unproven speculations that Microsoft might play a role not only in the patent part of that deal: The last thing Microsoft wanted was for VMware [...] to have a major operating system to offer to its customers. [...] Instead Microsoft used Attachmate as a proxy to take Novell off the operating system chess board as an independent Linux company. At the same time, it retains enough direct and in-direct control of Novell and its intellectual property to put them into play if needed to put trouble into Red Hat, Android, or Ubuntu's paths. Now, reports occurred (e.g. here) that OSI has lodged a complaint with the Bundeskartellamt to "urge the FCO to investigate the CPTN transaction thoroughly and consider appropriate remedies to address the concerns raised" (see press release). This request is essentially substantiated by the following argumentation: The proposed CPTN transaction represents a potentially new, and unprecedented threat against open source software: CPTN Principals have acknowledged that Linux and Open Source is a major threat to their business and have made hostile statements towards open source. Microsoft and Oracle both call out open source as a competitive threat in their most recent 10-K filings. CPTN principals have substantial market power in operating systems (Microsoft, Apple, Oracle), middleware (Microsoft, Oracle), and virtualization and cloud (Micr…