Leaked Memo Says Microsoft Raised $86 million for SCO

badzilla and numerous others wrote in with this: "Eric S. Raymond's Open Source site has a new Halloween memo. The Halloween X memo, which ESR says he received by email from an anonymous whistleblower inside SCO, appears to confirm Microsoft's alleged funding of SCO's anti-Linux initiative. And the actual dollar amounts are much larger than previously rumored!" The consultant is discussing his fee for bringing in this business, in the first few lines of the email.

I am a gud speller

[Liselle (684663)]

It's funny how the typos and bad grammar in the email lends credence to it. Looks like something I'd get from an exec at work! Well, minus the shady dealing with Microsoft, anyway. :P

Re:I am a gud speller

[EFGearman (245715)]

Hmmm... I have to agree. I can't recall (or find) an email that I have received from an exec, save for the tech exec I used to work for, that did not have spelling errors.

The tech exec knew where the spell checker was and he used it.

Re:This is a forgery.

[by Anonymous Coward]

So we're supposed to trust one anonymous source (you) over another anonymous source?

Re:This is a forgery.

[orthogonal (588627)]

I work inside SCO. Mike Anderer hasn't had anything to do with the company since June 2003. This is a clear and simple forgery. I lend it no credence. I'd suggest ignoring it.

Yeess, Darl. When you wave your hands like that I realize these are not the droids I'm looking for.

Re:This is a forgery.

[bcolflesh (710514)]

According to the Register article [theregister.co.uk], Mike Anderer is from S2 Strategic Consulting.

Can't... type... reply...

[The I Shing (700142)]

Can't... type... reply... too... much... outrage... head... exploding...

How can they get away with this?

[bc90021 (43730)]

Assuming this is an accurate and actual letter, how is it that a company can continue to do business in this manner? This company is not in the softwrae business anymore - it's in the lawsuit business. After all the happenings with Enron and WorldCom, how is it that this company, which has no real business plan (that's evident even outside the letter) attract customers or money?

We should attach a motor to Adam Smith's grave. I'm guessing we're at about 100K RPM and climbing.

legislating stupidity

[kardar (636122)]

My favorite Jesse Venture quote, or one of them: "You can't legislate stupidity".

He was talking about people riding snowmobiles on thin ice, ignoring warnings from the weatherman, and then dying from falling into freezing water.

But in this case, it would have to be the stupidity of the people who involve themselves in these meaningless pursuits of trying to immerse themselves in power.

It seems to me, anyway, that these guys corresponding are fascinated with power, not with anything else. Just power. Probably because they don't think they have enough money in their bank accounts.

Hopefully, they are in a minority - well, at least - this is not the way to be successful, and participating in this type of nonsense will only bring you and your family great misery - in the long run. Despite how successful these folks are in their own minds, their plan is just doomed to fail anyway - leak or no leak. Which means one thing... they are wasting their time, hence they are stupid. If they really cared about power and prestige and wealth, they wouldn't be wasting their time attacking Linux, which is innocent.

Paging the DoJ...

[Zocalo (252965)]

If this turns out to be genuine (and I'm sure ESR would have gone to great lengths to validate the document before going public), I can't think of better grounds for another anti-trust case. It's already on the Register [theregister.co.uk] too, and Groklaw can't be far behind. Let's draw attention to this smoking gun, shall we?

Re:Paging the DoJ...

[base3 (539820)]

Don't hold your breath. Remember that the current DoJ is the one that administered the slap on the wrist for the convicted monopolist's most recent infractions. Even if Kerry wins, I'm sure his administration can be bought, as well.

Re:Paging the DoJ...

[nuffle (540687)]

I'm sure ESR would have gone to great lengths to validate the document before going public

Don't be so sure. According to ESR's statement: I cannot certify its authenticity, but I presume that IBM's, Red Hat's, Novell's, AutoZone's, and Daimler-Chryler's lawyers can subpoena the original.

So take it with a grain of salt. I'm sure ESR thinks it's authentic, but until someone can confirm its authenticity, don't believe it. In the end, it's better to be skeptical of surprising evidence than to instantly accept false claims.

Re:Paging the DoJ...

[Jerk City Troll (661616)]

and I'm sure ESR would have gone to great lengths to validate the document before going public

Wait, are you being sarcastic? I can't tell.

And if you're not, exactly how would ESR go about doing that, hmm? If he knows the identity of whoever leaked it, he would have to reveal that in court. As far as I know, the source is anonymous. Is it possible to go to the investors and get the numbers on how much was contributed? Is that knowledge even public yet?

It makes good sense for Microsoft

[HMA2000 (728266)]

For $86 million Microsoft has created an enourmous amount of chaos. There is little doubt they will make their $86M back on additional because of the FUD the SCO crap has caused.

That doesn't make it any less sneaky, underhanded and evil though.

Re:It makes good sense for Microsoft

[The One KEA (707661)]

I will concede that there has been some upheaval and surprise in the business world due to this lawsuit, but I don't call it "enormous chaos." Despite the FUD and the lawsuits and the dupe of the media, Linux is still being enhanced and improved. And most importantly, it's still being adopted.

Now, if SCO were to win, THAT would be chaos indeed.

Re:It makes good sense for Microsoft

[FatRatBastard (7583)]

Despite the FUD and the lawsuits and the dupe of the media, Linux is still being enhanced and improved. And most importantly, it's still being adopted.

Not only that, but the memo is 5 months old and as far as I can tell SCO hasn't gotten any more significant money from Microsoft (maybe, just maybe EV1 was somehow tied into MS "you pay SCO a licensing fee, we'll discout your W2K server licenses by the same amount" but that's a bit too much tin-foil-hat thinking). This is telling me MS probably knows their cash to SCO isn't getting the kind of 'returns' it was looking for and has cut off the supply.

The lawsuits kind of point in this direction as well. SCO had gone a year "threatning" to sue, without actually doing it. If their threats actually worked MS would probably still be funneling cash to them one way or another and there would be no need to spend any money actually suing someone. Assuming the e-mail is real it looks like the gravy train stopped and now they actually have to find money on their own.

It may not...

[Chordonblue (585047)]

...now that the cat's out of the bag. The FTC should be informed, IBM and Novell should demand memos, etc. Microsoft may end up wishing they'd never done this.

I wonder if anything will be done based on this leaked memo - I mean legally can anything be done?

Does this really matter?

[dartmouth05 (540493)]

While this might have an effect in the court of public opinion, and I certainly think that it should (big bad Microsoft, trying to kill off its competitors using SCO as a weapon), I don't see its bearing in the legal arena. Regardless of whether or not Microsoft is bankrolling this lawsuit to stiffle competition from Linux, SCO either owns or doesn't own the code that they are trying to claim as theirs. If they own it, they'll win their lawsuits, regardless of who is paying for them.

Smoking gun? Well, maybe, if you're looking at a Microsoft violation of their anti-trust agreement, but it really has not bearing on the court cases.

"Rich"

[mordicus (677405)]

...is probably Richard Emerson [microsoft.com].

Accounting error

[Realistic_Dragon (655151)]

They have so much money that no one noticed the cheque for $8.6m was actually for $86m due to a missing decimal place.

The person responsible has been promoted to strategy and vision director.

Not an open source

[Knetzar (698216)]

I find it amusing that the people one /., the same people who believe that one should be able to go to the source and verify the code on voting machines, seem to believe what ESR is telling them about MS and SCO w/o having access to his source.
Does anyone else see the irony in this?

Too good to be true

[nonmaskable (452595)]

I don't think these guys are _quite_ dumb enough to admit to this stuff in email. Much less on company email that is all under subpoena in the IBM litigation.

I smell a setup.

Clearly you work for smarter people than I'm used

[doublem (118724)]

First off, I'm not addressing the authenticity of this specific e-mail, just the idea that such dealings would be sent by e-mail.

They are.

It's a common communication form, and I've had people where I work now think that by deleting an e-mail from their inbox, they erase if from exitance.

One of the shadiest people I met in my entire life was having problems with his computer, so the (then) network admin emptied the trash on the desktop and in Outlook as part of his cleanup. Said sales jackass was standing over his shoulder demanding an explanation of everything he was doing, and refused to believe that three years of e-mail were still readily available after he hit the "DEL" key.

"I deleted them, they're gone."

After much explanation, including my input, he finally said "It doesn't matter if only geeks can get at them."

Total idiot.

And then there was the day he found out about the backups we were doing of the mail server, and the fact that the "deleted items" were kept in our archives for 30 days.

He was not a happy man.

BTW: This is the same guy who was later fired when one of his business partners called up threatening to show up with a baseball bat and take out kneecaps.

I'm not saying the MS execs are anywhere near that level, I'm just saying that just because YOU and I wouldn't put something that incriminating into a system that could be tracked and recovered, doesn't mean other people would.

Besides, they probably never suspected the document would be leaked.

So what happens now?

[IamTheRealMike (537420)]

OK, so it seems to a non-lawyer that they've been caught red handed.

My question then, is what happens now? Is it possible to use this as evidence in a lawsuit? Is it possible to get it confirmed by subpoenia-ing (?) the original, and if so how quick?

What exact crime has been committed here, if any, and what are the possible punishments, again if Microsoft are actually doing anything illegal.

It might be admissable....

[doublem (118724)]

I distinctly remember being very surprised by some information I got in my Michigan law class.

The examples were "based on real cases."

A thief broke into a home and found a meth lab, and reported it to the police.

Another thief robbed a home, and later found what turned out to be murder evidence among his stollen goods. He reported it to the police.

In both cases, the evidence obtained by the thief was admitted into the trial.

I know this holds true in Michigan, and at the time the book stated that this was true in "Most US states." No clue about Federal court.

It was even mentioned that sometimes cops will make a deal with a known burglar to break in and retrieve evidence for them. So long as it never becomes known that the thief was asked or told to do this by the cops, then all is well. If it comes out that an officer of the law encouraged the activity, then the evidence will not be admissible. (The law course didn't tell us what would happen to a cop who encouraged such activity)

Microsoft's strategy could backfire

[RoLi (141856)]

It's pretty logic that Microsoft is behind all that. Otherwise the anti-Linux FUD spread by SCO just doesn't make any sense.

However, Microsoft's efforts could backfire badly:

If people actually start to think (I said "if" okay?) and realize that it's proprietary software that got people into legal trouble:

• IBM was sued because of their agreements around project Monterey and their licensing of proprietary SCO IP.
• Autozone was sued because they used the proprietary SCO Unix and SCO claims that they continued to use it after their contract expired.
• The suit against DaimlerChrysler is similar, they dumped SCO and SCO claims they continue using it

If any of those firms would have used 100% open source software from the start neither would have been sued.

Isn't the whole SCO-mess the biggest pro-OSS argument imaginable?

If you look at SCO: First you buy software from a seemingly honest Unix-vendor, a couple of years later their management changes and you get sued for it! SCO proves how dangerous proprietary sofware can become.

Who does this?

[Doesn't_Comment_Code (692510)]

"Well I've thoroughly enjoyed this clandestined discussion. I feel so devious and evil. But for my own records, could you write down everything we've just said (especially all the bad stuff we're doing) and distribute it to all the company employees? Make sure all the new guys get it too, especially the one in cubicle 4-B that doesn't like his job. Oh, and if this gets out it could ruin our public image, so try to keep it a secret, thank you." Microsoft VIP

The memo looks bogus

[Theovon (109752)]

I can believe that Microsoft gave $100 million to SCO. I think both Microsoft and SCO should burn in hell.

But I don't buy the memo. There are just too many "carefully placed" typos. It looks like someone engineered typos to make it LOOK authentic, but something about it's just a bit too intentional and obvious looking.

The document is a troll?

[Jerk City Troll (661616)]

Either the author of the leaked document in question was in extreme haste, or he has lackluster grammar skills. The document is full of errors like: "The will help us a lot", "componients", "shoudl", "wjich", and so on. That isn't exactly the kind of document you send out when you are trying to convince people to do something shady. You'd think the author would at least had the initiative to spell check the thing before sending it out. Perhaps it should be taken with a grain of salt, and by that, I mean deer salt licks [saltlicks.co.uk].

Re:The document is a troll?

[by Anonymous Coward]

Have you ever actually gotten a message from higher-ups? Or sales people, or lawyers??

That message reads about like all of them.

You're thinking too geeky. "I'm doing something subversive. Make it clean, neat, nice... blah blah." These people don't think like that. It's just another day at the fast paced office.

I'll hold my horses

[Underholdning (758194)]

There's nothing indicating that this is real. "An anonymous whistleblower"? What does that mean? He got it from [e-mail] from a public library IP?
I'd like to see the headers of the email. If the email originates from SCO then I believe it's authentic (judging from Received: lines rather than the From: field). If it's from a dial-up or public IP, I'm pretty sure it's fake. Of course, there's another posibility. OSI know who the whistleblower is, but they claim they don't so they can't be forced to reveal his identity in court. After all, they're the good guys.

They know no shame

[krygny (473134)]

I'd be ashamed to send an email that was that poorly written to a business associate at any level. And I'd have less regard for anyone who wood. :-)

Re:Wow

[the_consumer (547060)]

Sure it makes sense. It also makes sense that if you have a car I like, I should just take it, right?

If they want they want to maintain the greatest market share, maybe they should compete in the market, not in the courts. I suppose you like getting screwed, though, Fishbu.

Re:Wow

[gobbo (567674)]

Sure it's not honorable, but it's something any large business would do.

Look, stop saying things like that, people. You're giving away the MBA secret that big business is not honourable.

OK, it's not really a secret, just a taboo topic unless you're the so-called left-loonie fringe trying to change it. The amazing thing is, so many accept this kind of underlying failure of democracy and free markets without so much as a shrug! So is MS a success story or a travesty to you?

Re:Wow

[nial-in-a-box (588883)]

Yea, but this is blatant dishonesty and essentially cheating. I just read an article that says that ethical corporations do better in the long run, and this isn't a simple karma question. Be good to people and they'll be good to you. They're not just "customers" or "consumers," but people. This stuff is real, it's not a game. There aren't just rules, there are laws and morals and values. If you're an asshole now, as a person or a corporation, it will come back to get you one way or another. Microsoft and SCO may be getting what they want now, but they'll be hurting for this later.

Why not buy SCO then?

[b0r0din (304712)]

That figure doesn't seem right. Why would you give SCO 86M? Right now their Market cap is only like 170M or so, according to Yahoo Finance. If you had 86M you could just BUY a majority share in them.

Well I'm guessing it's pretty obvious. Windows doesn't want to be seen as an active participant in this lawsuit, but it's fairly apparent that they're trying to influence the court's decision. This is probably legal but highly unethical. Also, whose pocket is this 86M coming out of? The shareholders, probably.

The whole thing stinks, but I'm not completely sure this is correct information. 86M is a lot of money to be giving (and not investing) in a company. Maybe the reason they aren't investing is that they know SCO's lawsuit isn't sound?

Re:Wow

[Guy Innagorillasuit (249136)]

Yeah, but they're not funneling money to Yugo to sue GM and it's consumers.

Re:Wow

[TheLinuxSRC (683475)]

Absolutely. But Ford is not backing lawsuits against GM by a third party. And doing it under cover of darkness. The Baystar deal was a front for what would (will) probably be anti-trust violations on Microsoft's part. If Microsoft wanted to support SCO, there are legal ways to do it. Not by using other companies (Baystar> as cover-ups.

This could have been big! -Final version

[LibrePensador (668335)]

If the discovery process yields the original email, Microsoft is fucked.

ESR wasn't very smart. He shouldn't have published this YET.

Give IT to IBM lawyers so they know what to look for and when they are fairly certain that they have it among their discovery material, THEN publish it.

SCO's going to be shredding and I hear their email server *just* crashed and its hard drives are going to have to be replaced. All of the archive tapes have suddenly gone bad too.

This *could* have been the bomb but ESR probably blew it by speaking a little too soon.

Mods: Please mod the previous comment down and let this one replace it.

Re:Welcome to the real world folks.

[FortKnox (169099)]

Is it really 'unfair'? One company says they have a valid and legal way to take out the competition... why not fork over some cash to help them out?

Honestly, if Red Hat says they have proof that MS was using copyright code from one of its properitary dlls, and IBM gave them a boatload of cash to help out, would it be 'unfair'?

Always reverse the situation before you guys go foaming at the mouth!

Anti-trust fear is real also...

[Chordonblue (585047)]

The question is - where is this money coming from? What department at Microsoft authorized it, and do the shareholders/gov't know?

Squashing the competition is one thing, doing it in secret is another. This was clearly done this way to avoid more scrutiny by the DOJ. THAT'S what the problem here is.

If Microsoft wants to support SCO, they should just be honest about their intentions. If this memo is true, however, it's going to look fishy to anyone with half a brain at the FTC/DOJ.

Because it's illegal?

[Royster (16042)]

Read up on Maintenance and Champerty. These are legal torts involving funding lawsuits, especially frivilous lawsuits.

I don't happen to believe that the email is genuine, emails are too easy to forge, but no one should be so sanguine about this being in any way appropriate.

Re:Welcome to the real world folks.

[curtisk (191737)]

Although this does smack of "unfair" business practices it is a look at how *some* business alliances are formed.

Now, if you are going to condemn it in this case you also need to condemn it when one of "the big guys" comes to the rescue of something that *you* like.

Well said!

This is business for good or bad, it all depends on what side of the line you are on in the situation at at hand

Re:Welcome to the real world folks.

[Zocalo (252965)]

I'd say spending the best part of $100m on what is basically a smear campagin, by a company already convicted of, and facing additional convictions for, anti-competetive business practices goes above and beyond "unfair". Just because this is the way that things are done in some sectors of the business world does not mean it should be excused at all. Give them an inch and all that...

But you do have a valid point about the "them and us" aspect. If someone condemns Microsoft for this, then by rights they should also condemn IBM if they were to, say invest $100m in an anti-MS smear campaign. Not that that would ever happen - IBM still has a policy of never smearing a competitor as far as I am aware... ;)

Re:Welcome to the real world folks.

[DrSkwid (118965)]

> IBM still has a policy of never smearing a competitor as far as I am aware... ;)

lol, you make them sound so fluffy

IBM's founder spent time in prison for his string arm dealings in the cash register business (smashing up stuff, dumping, threatening).

He was awarded Nazi Germany's highest honour for a foriegner for leasing Holleriths and programmers to the Third Riech (they didn't run 10million+ slave workers with pencil & paper).

The story [ibmandtheholocaust.com] is an interesting read. Especially with regard to personal data & the unseen hand.

I wonder what a happened in this lawsuit [wired.com].

Re:Welcome to the real world folks.

[strider (3069)]

Now, if you are going to condemn it in this case you also need to condemn it when one of "the big guys" comes to the rescue of something that *you* like.

I don't even understand why you would think this. What we have here (regardless of the truth of the memo) is a classic case of a monpolist using its cash, market power and the legal system to maitain control of the market in order to continue its monopolistic practices. I can damned well condem this and be happy when a different company (say IBM) spends money to try to back a new product that threatens them, not because I think an IBM monopoly would be better but because I want no monopoly at all. That's consistent.

Re:HAH!

[dubious9 (580994)]

Yes, and if, in fact, this e-mail is real, then it will be real interesting to see what happens to SCO's revenue stream. I'm sure that MS doesn't like to be played the fool, and that about what these guys are saying here. I mean, christ...

but there are other ways to get money from them, their partners,investment bank referrals, etc..

and

This Microsoft deal is the Ante to the poker game...We should get this done and go after several $2-3 Million deals from the expense side of their company.

...sure makes it seems like they think MS is an easy, endless source of money. Well, let's just wait and see what'll happen.

Also, ~$100 mil isn't chump change, shouldn't there be some sort of public record of MS explaining this transaction, or can you "creatively account" for it?

Re:An order of magnitude?

[BerntB (584621)]

Round 7.8 to 8.

It's an order of magnitude since humanity's natural number base is octal.

No, it's not 10. Look at your hand -- the thumb is there for carry-bits when adding.

(Old PDP10 joke from before my time.)

Re:Right...

[PickyH3D (680158)]

It's also convienent that the whole letter just keeps reiterating how much money they have gotten from MS. I think after the second time it would be understood.

I realize most people are going to disagree, but of all the memos leaked before this does not look real. I could care less about the spelling, but the point of the e-mail is just sad ESPECIALLY if we are considering someone leaked the memo must have been a recipient. That's not exactly a business wide e-mail. No one that high up would go try to shoot themselves in the foot at this point.

Re:The Wizard of SCOz

[EvilTwinSkippy (112490)]

And at the end, Linus wakes up and is surrounded by Dennis Ritchie, Ken Thompson, Richard Stallman.

Linus: Uncle Ken, Uncle Ken, there's no place like /home!

Looks like a duck.

[eddy (18759)]

I see myself as a sceptic, but on the other hand...

>Patenting IPX? give me a break.

Would you categorize this as more or less preposterous compared to the statements "There are millions of literal lines of System V copied into linux" and "We own the UNIX operating system"?