How to Settle Your Differences With Microsoft

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Editor's note: Contrary to reporting in a previous version of this article, TomTom is a public company traded on the Euronext exchange. The Fool regrets the error.

GPS navigation specialist TomTom can breathe a sigh of relief today and wipe the beads of cold sweat off its anthropomorphic forehead. The company has settled the patent infringement claims Microsoft (Nasdaq: MSFT  ) brought against it last month.

In what looks like a total victory for Microsoft, TomTom will send license fees to the software giant and stop using a couple of vital file system patents. "When addressing IP infringement issues, there are two possible paths: securing patent coverage or not using the technology at issue," said Microsoft's licensing head Horacio Gutierrez in a written statement. "Through this agreement, TomTom is choosing a combination of both paths."

TomTom couldn't simply pay the balance and go fully licensed, because much of its core software was written under the open-source GPL license. The GPL "copyleft" license doesn't mesh well with proprietary licenses like the ones covering Microsoft's FAT file management technology. Now TomTom gets two years to design a workaround of some sort.

Several public companies lean heavily on GPL-licensed software, including Linux vendors like Red Hat (NYSE: RHT  ) and Novell (Nasdaq: NOVL  ) . Sun Microsystems (Nasdaq: JAVA  ) has acquired several GPL proponents such as the MySQL database team and the virtual server experts of Innotek, and seems to generally like the GPL a lot.

Other friends of open software include IBM (NYSE: IBM  ) , Adobe Systems (Nasdaq: ADBE  ) , and Google (Nasdaq: GOOG  ) . The license has yet to see a serious test in court, but it certainly behooves TomTom to work within the license rather than taking its chances as a licensing maverick. The benefits of GPL and other open-source licenses are many, including cost savings and a free flow of ideas from one project to the next. And as the companies above show, you can still make money from selling and supporting software under the GPL.

The TomTom agreement sets a precedent for others to follow if Microsoft or some other giant with a fat patent portfolio goes after their open-sourced applications. One day, maybe Microsoft Office will be published under the GPL. In the meantime, don't be afraid to invest in open-source specialists.

Further Foolishness:

Microsoft is a Motley Fool Inside Value recommendation and Google is a Motley Fool Rule Breakers selection. Try any of our Foolish newsletters today, free for 30 days.

Fool contributor Anders Bylund owns shares in Google, but he holds no other position in any of the companies discussed here. You can check out Anders' holdings or a concise bio if you like, and The Motley Fool is investors writing for investors.

Read/Post Comments (1) | Recommend This Article (4)

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On March 31, 2009, at 7:06 AM, prginww wrote:

    "The license has yet to see a serious test in court,"...

    Do the sco lawsuits not qalify as a serious test, and validation of the GPL?

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