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Microsoft Lauded For Indemnification Program

As Linuxphiles descend on Boston for the big LinuxWorld convention scheduled to begin next week, Microsoft has issued a press release touting a pair of recent independent analyst reports that praise its indemnification initiatives.

The reports from IDC and Forrester Research highlight the improvements made to Microsoft's indemnification program last November when the company extended protection to end users of a long list of current and past versions of its software.

Microsoft's indemnification program covers the Windows operating system, Office and Windows Server System, as well as intellectual property disputes that could arise from patent, copyright, trade secret and trademark disputes. As part of the program, Microsoft has stated that it would pay any resulting damage awards or settlements relating to its software and defend any covered claim.

IDC's report, "Microsoft Augments Intellectual Property Indemnification," examines the indemnification and its market implications. According to Stephen Graham, group vice president of the IDC software business strategies group and one of the report authors, end user intellectual support really does matter for end users.

"It's important to remember the potential disruption a customer can face from the threat of litigation alone," Graham told internetnews.com. "And it's also important to point out that there are a number of issues that underlie the need for end users to take a rational approach to understand and assess their risk."

There are a number of noteworthy aspects to Microsoft's indemnification initiatives, though their relative importance and what makes it "better" ultimately depend on the needs of an individual company, according to Graham.

"One aspect that does set it apart from other programs/policies is how a customer engages the coverage in that there are no contract addendums, etc., required," Graham explained. "This is something we've noted as important for customers to clarify -- how does this actually work and when am I covered?"

Forrester Research's report, "Microsoft: Protecting Its Customers," notes the initiative would offer greater protection to Microsoft's customers.

"By expanding protection to average consumers, Microsoft has set a precedent that should help protect the investments of its customers -- protection not currently offered by other vendors," Julie Giera, a vice president of Forrester Research, said in a statement.

Customer indemnification has been a big issue for many on the Linux side of the IT industry owing to the ongoing intellectual property dispute with SCO.

Linux vendors, including Red Hat and Novell, as well as resellers like HP and IBM have all taken moves to indemnify their customers.

Microsoft is aware of its competitors' indemnification initiatives and isn't worried about users making a comparison between them.

"We recognize that some people are now comparing the indemnification offers IBM, Sun, HP, Novell, RedHat and Microsoft are making for their products, and we encourage them to do so," Martin Taylor, general manager of the platform strategy group at Microsoft, told internetnews.com. "The level of protection offered by each company varies, and we think customers benefit from having the broadest protection available. Our goal is to provide the fullest coverage possible for our customers.

"This is an important industry issue and vendors owe it to their customers to stand behind their software," he added.



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