Monday, April 30, 2007

Trademarks and Open Source

More news on the open source / trademark front. eWeek reports on Ubuntu's trademark policy.

Trademarks have recently become something of an issue in open-source circles. Debian, for example, recently took exception to Mozilla's Firefox trademark rules and called its version of the popular browser, IceWeasel. So, Ubuntu has decided to address possible trademark issues by creating its own trademark policy.
As many of you know, open source licenses generally grant the licensee the right to freely modify and distribute the subject software's source code. In essence, open source takes away the copyright restrictions that so many proprietary software companies use to protect their code.

However, open source licenses do not grant the licensee rights to use the licensor's trademarks. In fact, trademarks rights are enforced strictly by companies that distribute branded open source software.

As Mark Webbink, Red Hat's deputy general counsel and secretary, said in 2004, Red Hat has no problems with anyone using its source code. But Red Hat does have problems with anyone using its name or its trademark "shadowman." That, Webbink said, Red Hat guards zealously. "In the open-source economy, it's the Red Hat brand, as well as its service, that carry value."

Thus, as eWeek points out, while CentOS' operating system is derived from Red Hat's code, it can't use the Red Hat trademark to identify its code. And so CentOS says that "CentOS is an Enterprise-class Linux Distribution derived from sources freely provided to the public by a prominent North American Enterprise Linux vendor."

So open source companies such as Red Hat and Ubuntu sell commodities and build their value by building brands that customers prefer. If the value of these companies exist solely in the brand, then you'd expect them to vigourously protect their trademarks. See excerpt from Open Sources: Voices from the Open Source Revolution talking about Red Hat:

If we do not own intellectual property the way almost all of today's software companies do, and if those companies insist that their most valuable asset is the intellectual property represented by the source code to the software they own, then it is safe to say that Red Hat is not in the Software Business. Red Hat is not licensing intellectual property over which it has ownership. That's not the economic model that will support our customers, staff, and shareholders. So the question became: What business are we in?

The answer was to look around at other industries and try and find one that matched. We wanted an industry where the basic ingredients were free, or at least freely available. ...

We looked at the commodity industries and began to recognize some ideas. All leading companies selling commodity products, including bottled water (Perrier or Evian), the soap business (Tide), or the tomato paste business (Heinz), base their marketing strategies on building strong brands. These brands must stand for quality, consistency, and reliability. We saw something in the brand management of these commodity products that we thought we could emulate. ...

This was Red Hat's opportunity: to offer convenience, to offer quality, and most importantly to help define, in the minds of our customers, what an operating system can be. At Red Hat, if we do a good job of supplying and supporting a consistently high-quality product, we have a great opportunity to establish a brand that Linux OS customers simply prefer. ...

The power of brands translate very effectively into the technology business. We have evidence of this in the Venture Capital investors who have recently invested in several Open Source software companies. The one common denominator between all of the investments to date have been that the companies or their products have great name recognition, and are recognized as being quality products. In other words, they have successfully established a brand.

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