Red Hat Indemnifies Enterprise Linux Buyers

The company said its Open Source Assurance program will include an "intellectual property warranty" that indemnifies customers against infringement claims and assures them that Red Hat will replace any code within its Linux software that is found to infringe on valid copyrights or patents.

"We have provided this guarantee to many of our large enterprise customers, and we are now extending this guarantee to all customers who use Red Hat Enterprise Linux," vice president of business development Bryan Sims said. "Enterprise platform deployments are key investments that should be protected."

Red Hat's move was announced as the LinuxWorld Expo kicked off. HP announced its own indemnification plan in November, and Novell said just last week that it would provide legal protection to customers who use its SuSE Linux products.

Confidence, Man

The legal defense shield is seen by analysts as both a way to reassure potentially skittish customers and a statement of defiance and confidence in the face of The SCO Group's multibillion-dollar legal campaign against Linux vendors and, inevitably, end users of the open-source platform.

Yankee Group senior analyst Dana Gardner told the E-Commerce Times that the vendors may have been waiting to evaluate the strength of SCO's case before extending indemnification to their customers. With the courts handing some early legal defeats to SCO by requiring it to detail how the Linux kernel is similar to code contained in its Unix patents, they may have been emboldened to step forward.

"It sends a powerful message to customers and end users," Gardner said. "It tells them they can buy this software, deploy it and not have to lose sleep at night worrying about the legal ramifications. Their vendors have their backs covered on that front."

Gardner said other actions, including last week's establishment of a Linux legal defense fund bankrolled by Intel (Nasdaq: INTC) , IBM (NYSE: IBM) and other tech heavyweights, have added to the confusion over Linux' future.

Going Strong

However, as evidenced by several developments -- strong sales reports from Red Hat, IBM's plans to hire more Linux-capable engineers and the intense attention focused on LinuxWorld this week -- potential buyers have not been scared off in large numbers yet.

"There is more caution among enterprises, especially those thinking about their first Linux deployments," Gartner (NYSE: IT) analyst George Weiss told the E-Commerce Times. However, he noted, "So far, the value proposition, the cost savings and the flexibility of the open-source option have been enough to overcome those concerns."

Monkey See

Weiss said competition is now driving the new indemnification programs. Novell's decision to indemnify customers of its newly acquired SuSE Linux product line likely helped prompt Red Hat to act quickly. Weiss noted that Red Hat already has filed a countersuit against SCO, another move designed to provide assurance to customers.

"Customers want the insurance of an actual policy as well as the assurance of knowing a company is prepared to fight," he added.