Last week's pact between Microsoft and Novell has led to widespread speculation over the long-term impact on the adoption of open-source software. Under the deal, the companies will work on ways to enable Novell's Linux distribution, Suse, and Microsoft's Windows operating system to work better together. They also reached a patent truce in which users of the other's software can't be sued for infringement, and Microsoft agreed not to sue noncommercial open-source developers. On Monday, Microsoft's Bill Hilf, general manager for platform strategy, spoke further about the deal with Jeremy Kirk, addressing how Microsoft views its intellectual property relative to Linux.

How does Microsoft view open source?

Microsoft does not compete with open source. We compete with open-source products that people sell. When we did the deal with JBoss [an open-source middleware company now owned by Red Hat], we found a few interesting stats. Half of their users were running on Windows. We also found after we did the deal, we sold more Windows server licenses. That's just fundamental good business. So when we get into the competitive debate, JBoss helped our Windows server business grow.

There have been looming questions for years if Microsoft would file lawsuits over intellectual property contained in Linux. What is Microsoft's motivation with Novell?

This is an intellectual-property deal. There will be an overlap at some point between our intellectual property and open source that we have to resolve. We knew that. It was going to happen. It was just a question of when.

We said let's put in place something that allows us to a) establish a process for how we can work with an open-source company on our intellectual property, b) do it in such as way that it can still work within the [GNU] GPL [general public license] and c) how do we do this in a way where we can clearly draw the line between the community developer, the noncommercial open-source community guy writing code and the commercial developer who is using open-source code. Doing one of those is easy, doing two of them is actually hard but possible. Doing all three is very, very hard because one can contradict the other.

What is the overlap between what Microsoft does and what the open-source community does?

We have the largest software patent portfolio in the world. With open source we needed to have something in place where we knew that if our intellectual property was infringed upon we had a framework in place to resolve that in an effective way. The terms of the agreement that relate specifically to what we call covenants for Novell customers are related to the fact that those customers will be deploying a variety of open source.

We said there is a way we can cover that customer and still have value for our intellectual property. The second part is there is a large class of people in the community who are writing software for free and are not selling it and who may either intentionally or inadvertently step into that footprint of our intellectual property. What we are trying to do is draw the line between people who make money from this and people who don't. We needed to have the peace of mind both for the customers who are choosing to put this stuff into their environment as well as developers.

It seems like a veiled threat to Red Hat users -- there's only one way to protect yourself legally and that's by using Suse Linux.

There's no threat. There's a fundamental premise that we need to have the market understand we have a substantial amount of intellectual property in the operating system space.