Microsoft: Market Shrugs Off Linux Patent Claims

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Microsoft (MSFT) says that open source Linux violates 235 of its patents. And, the world’s largest software company wants royalties. Perhaps the whole thing will end up in court.

The Linux OS is used in a number of servers used by companies around the world, so the patent problem is not just an egg-head issue for student law reviews.

But, the market does not appear to care much, at least no in the short term.

If there is any pure play proxy for Linux OS software sales, it is RedHat (RHT). And, its stock is flat on the news. At noon, it was at $22.75, flat on light volume of 675,000 shares. On a normal day the stock trades over 2 million shares. No running for the doors here.

The movement in RedHat is counterintuitive, unless Wall St. believes that Microsoft will not push its claims. And, that may be the case. With a number of huge companies around the world using Linux in their IT infrastructure, MSFT could alienate a lot of customers if it disrupts the intricate software systems that are vital to operating large enterprises.

The long and short of it is that no one seems to care

Douglas A. McIntyre