Letter To SCO's Partners
Subject: SCO Suspends Linux Activities
Dear SCO Partner:
As a SCO Partner, we thank you for your support and continued business.
Because you are a valued partner, it is important that we make you aware
of important SCO business decisions and announcements as soon as possible.
As such, we wanted to make you aware of an important announcement made
This communication is about recent efforts SCO has made to license and
protect our patents, copyrights and intellectual property pertaining to
the UNIX® operating system. As you know, on March 7, 2003 SCO announced
that it filed legal action against IBM in the State Court of Utah, for
misappropriation of trade secrets, tortuous interference, unfair competition
and breach of contract. The complaint alleged that IBM made concentrated
efforts to improperly destroy the economic value of UNIX, particularly
UNIX on Intel, to benefit IBM's new Linux services business.
As we have progressed in our discovery related to this action, SCO has
found compelling evidence that the Linux operating system contains unauthorized
SCO UNIX intellectual property (IP). Due to this discovery, we are taking
three immediate courses of action.
1 - The first is to send a letter alerting commercial users to the fact
that legal liability for the use of Linux by businesses may extend to end
2 - The second action we are taking is to suspend all future sales of
the Linux operating system from SCO until the attendant risks with Linux
are better understood and properly resolved.
3 - Finally, although this action affects future development and sales
of SCO’s Linux offerings, SCO will continue to support our SCO Linux
and OpenLinux customers and partners who have previously implemented those
products and we will hold them harmless from any SCO intellectual property
issues regarding Linux. SCO will continue to honor all contractual obligations
with existing customers including product updates, service, and support.
As many of you are already aware, SCO UNIX systems continue to sell well – including
an increase in OpenServer sales over the previous quarter. Our UNIX products
continue to support many of the world’s largest businesses. In addition,
new customer sales indicate that there is still no better option for rock-solid,
dependable technology for their core businesses than our SCO UNIX solutions.
We are excited to be building on our SCO UNIX history as we roll out our
next generation UNIX operating system and SCOx framework this fall. SCOx
will allow small and medium business customers and branch offices to plug
their existing applications into a Web services environment. Details of
this strategy will be unveiled at SCO Forum in Las Vegas late this summer.
(For more details, see: www.sco.com/2003forum/.)
SCO remains committed to building new business opportunities for our partners
such as you. We recognize that you have depended on us to provide reliable,
solid technologies for your customers for over twenty years. We look forward
to helping you and your customers meet your business needs for the next
President and CEO
The SCO Group