I’ve asked a few times why IP assurance is a customer concern. But I’m not a lawyer, or one in training. Lucky for you, Luis Villa (a lawyer in training and OSS guy) jumped in to correct me. “…make what appears to be the same error: comparing IP t…

I wasn’t saying that there is *no* risk but rather that the risk is minimal AND (I didn’t make this point on my blog, but I’ll make it now) there are sufficient guarantees in every standard contract to mitigate what risk there is. Namely, that the vendor will rewrite, replace, defend, and/or refund. Given this, there is little or no reason for IP indemnification. It’s a mostly useless safety blanket that frankly isn’t worth much even if it’s unlimited. (How many vendors could actually stand behind a $100M damages claim? I can count them on one or two hands – does that mean these are the only ones from whom customers should buy? Of course not.)

IP indemnification is a farce foisted on the industry by big and small patent trolls (Microsoft included). As the GC of the Very Large Software Company I referenced noted, and which I repeat here, a few years ago no one asked about this. In Europe they still don’t. It’s a recent American fetish, and an unhealthy one.

Unfortunately, this is much harder to offer for open source companies/products. If someone finds, say, GNOME is infringing on their patent, there isn’t much profit in suing the GNOME Foundation or random developers. The profit would come from suing some large corporation that uses GNOME. (Most likely one that has publicly trumpeted their mass switch to Linux/GNOME.)

There have been several risk averse corporations I have worked with who refused to allow any type of open source software in their organization, even ones from large commercial backers like Sun or IBM, as they considered the risk too high.