Sun, Microsoft Settle Differences

by David Worthington

Sun Microsystems and Microsoft have found peace - for price of 1.6 billion US dollars. Under the agreement Sun has agreed to settle all pending litigation against its once bitter rival, and the two industry giants will collaborate on ways to make their products work better in mixed environments.

As part of the agreement, Sun and Microsoft will enter into a 'covenant' not to sue each other over past patent violations, with a clause to extend that arrangement into the future. Tentatively, negotiations are set to sort out a sweeping patent cross-licensing agreement that would enable the companies to share technology by paying each other predetermined royalties.

Commenting on the agreement, Scott McNealy, chairman and chief executive officer of Sun Microsystems said, "This agreement launches a new relationship between Sun and Microsoft - a significant step forward that allows for cooperation while preserving customer choice."

McNealy, who once called Microsoft an "unrepentant monopolist" will accept US $700 million to resolve pending antitrust issues and an additional $900 million to resolve patent issues. Microsoft will pay US $350 million upfront once it dips into Sun's pool of patents. Coincidentally, Sun is expected to experience a quarterly loss beyond what was previously projected and is laying off 3,300 workers.

The technical collaboration between Sun and Microsoft will be initially focused on Windows client and server-based technology. Each company will open up portions of its server products with the end result being new products that work well together. Sun will also join Microsoft's Communication Protocol Program. Down the road, the cooperation will extend to email and database software.

In addition, Microsoft and Sun are working to provide customers who maintain heterogeneous computing environments with a system for seamless identity management. Once this initiative is fleshed out, identity information will be passed between Microsoft Active Directory and Sun's Java System Identity Server. Active Directory is used to authenticate Windows Rights Management.

It is unclear whether or not Microsoft will now join Sun's Liberty Alliance to arrive at a common set of standards in the identity management space.

The duo's collaboration on identity management also parlays into web services. To this end, Sun and Microsoft will work to improve integration between Java and .NET technologies. No specific information on how this will be accomplished has been released.

Another area of contention that was ironed out is in Microsoft's support for Java. Microsoft previously backed a disparate implementation of Java that was optimized for the Windows platform. This prompted Sun to take Microsoft to court, and ultimately, Microsoft's phase out of MSJVM from its products. Under the truce, Microsoft may continue to support customers who have already deployed MSJVM.

Although the settlement makes for strange bedfellows, the companies continue to compete with one another. "Our companies will continue to compete hard, but this agreement creates a new basis for cooperation that will benefit the customers of both companies," said Microsoft CEO Steve Ballmer.

Ballmer continued, "This agreement recognizes that cutting edge R&D and intellectual property protection are the foundation for the growth and success of our industry. This is a positive step forward for both Sun and Microsoft, but the real winners are the customers and developers who rely on our products and innovations."

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