H-P Offers to Take the Worry Out of Linux for Customers

Wall Street's reaction Wednesday to Hewlett-Packard's (HPQ Quote) plan to indemnify Linux users from legal challenges from SCO Group (SCOX Quote) supported the interpretation that H-P is giving little credence to SCO's suit over Linux open-source code.

Shares of SCO dove $1.69, or 9%, to $17.20 in recent trading. H-P shares were down 2.1% at $19.97 and shares of Red Hat(RHAT Quote), one of the major vendors of Linux software and services, declined 2.3% to $10.40 in recent trading Wednesday, when the company also held its analyst day.

H-P, the No. 1 platform for Linux, said this week that it would indemnify its Linux customers against any legal actions by SCO. SCO already has sued IBM(IBM Quote), charging Big Blue with a breach of contract for misappropriating SCO's code in IBM's Linux business. SCO has written letters to Linux users asking them to pay for a Linux license but also suggested the previous refusal by Linux vendors to indemnify customers leaves it little choice but to sue users next. ...