Sun and Microsoft reach $20 million court settlement

After three years of fighting it out in the US courts, Sun and Microsoft have settled their dispute, stemming from a Java technology licensing agreement between the two companies.

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By  Greg Wilson Published  January 27, 2001

After three years of fighting it out in the US courts, Sun Microsystems and Microsoft have settled their dispute, stemming from a Java technology licensing agreement between the two companies. The distribution and licensing agreement, which was due to expire in March 2001, is immediately terminated.

Under the terms of the settlement, Microsoft will pay $20 million to Sun, for the right to continue shipping all current products containing Sun’s technology for a period of seven years. The settlement also prevents Microsoft from using the Java trademark in any new products.

"Microsoft is unwilling to accept the rules of the Web," said Patricia Sueltz, executive vice president of Sun's software group. "When faced with compatibility or termination, it chose termination."

Not surprisingly Microsoft put a different spin on the ending of courtroom hostilities. "Microsoft is very pleased with the successful conclusion of this litigation," Tom Burt, deputy general counsel for litigation at Microsoft, said in a statement.

"This settlement will not impact our customers or current products in any way and will allow us to focus our time and resources on what we do best: developing great software."

Sueltz added the settlement effectively ends the possibility that Microsoft can build Java into its .Net platform. "They can distribute an outdated version of the technology, but can't use it for .Net," said Sueltz.

Sun executives also said that even though Microsoft can't build Java into future versions of its Internet Explorer browser, it would not hurt the spread of client-side Java in the industry, citing a boom in Java on multiple devices such as PDAs and cell phones.

To some degree the .NET strategy along with XML has taken the fire out of the confrontation between Microsoft and Java. “As this has occurred, Microsoft has recognised that continuing as an overt and legal antagonist to Java has had diminishing returns for the past few years,” stated a Gartner Group report on the settlement. “Because Java has gained enough momentum to ensure its place as a primary language and platform for business applications, Microsoft has increasingly been cast as an outsider in the quest for enterprise platform solutions.”

With the court case out of the way, Microsoft is now free to either license Java outright or to continue in its effort to create a Java-like environment within its .NET that supports the syntax without using Sun licensed property, says the report. Whether Sun will allow Microsoft to take out another license remains to be seen.

“The settlement also makes it easier for Microsoft to claim that the .NET platform will support the more popular programming languages, a claim that was made hollow without support for Java and with Microsoft at odds with Java's primary promoter, Sun,” added the report.

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