Open Source Company Alleges IBM Antitrust; IBM Requests Analysis

[Note: updated below]
Computer giant IBM is facing an antitrust claim before the European Commission brought by an open source software company alleging that IBM is preventing customers from using that software. Meanwhile, the open source community is worried that the use of intellectual property rights by IBM – a leading open source software maker – to block a competitor will endanger free and open source software and might uncap other IP rights claims from other players. IBM, for its part, is reaffirming its support to the open source community and has asked the competing company to explain how its software does not infringe on IBM IP rights.

In 1999, the Hercules open source project team created the Hercules “emulator.” This technology takes the IBM instructions set, translates and interprets them so that IBM customers’ programmes and applications can be run on non-IBM mainframe platforms, such as a Microsoft server built on Intel processing technology, according to Ted Henneberry, US attorney for TurboHercules SAS, the France-based commercial entity trying to market Hercules, and author of the antitrust claim.

TurboHercules was founded in 2009 by Hercules creator Roger Bowler. Shortly after the company was created, Bowler sent a July 2009 letter [pdf] to IBM explaining that the company was trying to “establish a commercial business that offers customers a choice in mainframe-compatible platforms, while contributing to the long-term health of the IBM mainframe ecosystem.” TurboHercules proposed to make available to IBM’s mainframe customers a licence for IBM operating systems on the TurboHercules platform, letting IBM set the pricing of such a licence “on reasonable and fair terms.”

A mainframe is a computer architecture particularly suited to handle large batches of data processing. A mainframe can be used to deal with bank credit card transactions or airline reservation systems.

IBM replied in November declining the offer, saying that “mimicking IBM’s proprietary” system required the company’s intellectual property. “You will understand that IBM could not reasonably be asked to consider licensing its operating system for use on infringing platforms,” IBM said in 4 November letter [pdf] posted on TurboHercules’ website.

According to its 18 November response [pdf] to IBM, TurboHercules expressed surprise at IBM’s mention of IP rights infringement and the lack of support for open source, saying that such a position breaks from the world leader’s previous position and 2005 pledge of non-assertion [pdf] of 500 of its patents against open source.

In March 2010, IBM finally answered [pdf] that it had “substantial concerns about infringement of patented IBM technology,” that the company had spend “many years and many billions of dollars developing” its technology, and that IBM was “widely known to have many intellectual property rights in this area.” In this letter, IBM provided a list of patents that might be infringed by Hercules. According to Bowler, at least two of those patents are part of IBM’s 2005 pledge.

“Hercules existed for over ten years without any claims from IBM that Hercules infringed any IBM intellectual property, and IBM devoted a chapter in one of its Redbooks to Hercules before quietly deleting that chapter several years ago,” Bowler said in a statement sent to Intellectual Property Watch.

Antitrust Charge against IBM

On 23 March, TurboHercules filed a formal complaint against IBM with the European Commission’s Directorate General for Competition in Brussels, according to a press release. The complaint said that IBM has a “100 percent monopoly in the market for mainframe operating systems,” and is trying to abuse this monopolistic position by denying customers the possibility to run IBM’s operating system on anything else than IBM mainframe hardware in what the complainant describes as “illegal tying.”

The Commission’s directorate will request a response from IBM and after analysing it in the context of previous claims of the same nature, will decide whether or not the claims warrant a formal proceeding, according to Henneberry.

Moreover, according to TurboHercules, IBM, which in the past had a policy of publishing interoperability information for its mainframe operating systems, has recently introduced new features relying on undocumented interfaces between IBM’s system z operating system (z/OS) and IBM’s mainframe. That prevents the open source community from “maintaining full compatibility between Hercules and IBM’s mainframe operating system,” according to the release.

The antitrust claim is asking the European Commission to request IBM to licence its mainframe operating systems independently from its mainframe hardware, and requests IBM to continue publishing the technical specifications for z/OS interfaces and protocols or licence those interfaces or protocols to TurboHercules.

In a 6 April press release, Bowler said that the decision to take action against IBM had been taken reluctantly. “We are not asking that IBM be subjected to punishing fines,” but we “simply want IBM to agree to allow legitimate paying customers of its z/OS mainframe operating system to deploy that software on the hardware platforms of their choice.”

Hercules is “not a fake Gucci handbag,” said Bowler, “it is a third-party, open source software-based emulator developed in good faith using IBM’s published documentation of its z/architecture.”

FOSS at Risk?

For Florian Mueller, software developer and founder of the NoSoftwarePatents campaign in 2004, the patents that IBM says Hercules infringe could potentially threaten other key free and open source software (FOSS) projects, such as MySQL, VirtualBox, and SQLite.

Mueller has listed on the FOSS website the list of patents that might be endangering open source projects. According to Mueller, “IBM’s attack on Hercules is an attack on interoperability and FOSS innovation in general.” Mueller is calling for a regulatory intervention.

IBM Reaffirms Open Source Pledge

IBM reaffirmed its pledge to the open source community in a statement sent to Intellectual Property Watch. The company said it has “invested billions of dollars over the years as part of its commitment to this community.”

“If TurboHercules is a qualified member of the open source community and complies with the provisions of the pledge, IBM would not assert any legal rights to the two pledged patents against TurboHercules,” said in the statement. “However, since very little is known about TurboHercules, it is up to that company to establish its qualifications to be part of the open source community.”

“Additionally,” IBM said, “there are numerous other patents, of which we’ve made TurboHercules aware, that the TurboHercules emulator may infringe upon. That was the entire point of our letter: to make TurboHercules aware of our intellectual property so they could do the appropriate analysis. We look forward to that analysis.”

According to Henneberry, TurboHercules would like the European Commission to revert to previous decrees, such as the European decree known as the “1984 Undertaking” [corrected] between the European Commission and IBM. It “was agreed to by IBM to settle an investigation by the Commission into the same practices which TurboHercules is complaining about. Under that agreement, IBM was required to publish interface protocols and other technical information which allowed non-IBM hardware platforms to be used by customers with the IBM operating system – in other words, it prevented IBM from tying its operating system to its own hardware platform.

IBM retained the right to pull out of the Undertaking upon notice, which it gave in the late 1990s. The Commission at the time said it would continue to monitor the market,” he told Intellectual Property Watch. “A similar court decree was also in effect in the US, but was terminated in 2001.”

[UPDATE: a debate has arisen within the free and open source community about the status of TurboHercules as an open source company. Examples of this discussion are here and here.]