HP Leaps Ahead of the Competition by Indemnifying Linux

By Bill Claybrook

September 25, 2003

Hewlett-Packard announced on Wednesday that it will indemnify its Linux customers against potential legal actions by SCO Group.

In the past week, I have written two pieces about software indemnification and software warranties with a focus, more or less on Linux. To repeat some words from one of the other pieces, "indemnify means to compensate for loss, damage, or expense incurred; to give security against future damage or loss."

HP's Linux indemnification policy says that HP will indemnify Linux users from lawsuits (i.e., defend them from lawsuits) by SCO based on the following:

  1. The Linux distribution must be purchased from HP.
  2. The Linux distribution must run on HP hardware.
  3. The user must purchase one of HP's standard Linux support contracts (there is no bump in the support contract price for indemnification).
  4. The indemnification coverage applies only to the binary shipped by HP. If the user modifies the source of Linux or any open source package shipped with the Linux distribution, this violates HP's indemnification policy.
  5. The Linux indemnification policy by HP pertains only to actions taken by SCO (and no one other than SCO) against end users.
  6. The indemnification policy includes not only the Linux kernel but also all open source packages in the Linux distribution.

The Linux indemnification policy by HP is a very strong because:

  1. Companies that deliver proprietary software generally indemnify some of their software to some of their users, but they do not necessarily indemnify all of their own software to all of their users.
  2. Proprietary software companies do not warranty, nor indemnify, Third Party software. Users are referred to the Third Party software license agreements.
The reason that the Linux indemnification policy by HP is so strong, even stronger than its proprietary policy as far as I can tell, is that HP is indemnifying software that was written by many "Third Party" open source organizations and individuals that they likely do not even know. Tomorrow, we will look at the marketing advantages that HP is likely to gain over IBM by this announcement.

10:34 ET

Copyright 2003