If you followed the almost 12-month-long battle Oracle (NYSE:ORCL) waged to acquire Sun in 2009, you probably remember a lot of hot air from the European Union (EU) about the MySQL enterprise software. You might forget the fact that Oracle said all along that the acquisition was really all about Java enterprise software and that the U.S. Department of Justice (DoJ) briefly held up the acquisition in order to better understand Java licensing terms and conditions.
What the DoJ was asking about in June 2009 finally played out in the information-technology (IT) marketplace on Dec. 9, 2010, when one of the purest of open source purists - the Apache Software Foundation (ASF) - pulled out of the pseudo-open standards and code-sharing efforts that have surrounded Java over its 20-plus-year history. The JAVA community coordinating effort is currently called the Java Community Process (JCP). The ASF and JCP have been loosely linked since around 2000, and around 2002 the ASF convinced the JCP and Sun to become more open, in that Sun would give up some of its intellectual property (IP) rights to the community, something the ASF always interpreted to mean Java was becoming open source as defined by the Open Source Initiative.
But Sun never gave up all of its IP rights and Oracle never intended to become more open after it acquired Sun (and probably always intended to be less open given its opinion that Java was the jewel in the Sun acquisition). In particular Sun and now Oracle maintained "field of use" restrictions on its Java framework that said - for example - that a programmer of JCP-framework-derivative software is "prevented from freely using that software and that hardware in any application where the computer was placed in an enclosed cabinet, like an information kiosk at a shopping mall, or an X-ray machine at an airport."
On Dec. 8, the JCP essentially voted to explicitly accept this previously implicit type of license condition in the next version of the Java framework.
Although the ASF is one of the purest of the open source purists, it is not just a bunch of programming guys hanging around the Elks lodge that is the open source community. The ASF is best known as the sponsor of what is probably the most successful open source software project ever, the Apache HTTP (web) Server. Apache in turn is sponsored heavily by Facebook, Google (NASDAQ:GOOG), HP (NYSE:HPQ), Intuit (NASDAQ:INTU) and other IT investment household names. IBM (NYSE:IBM) made significant in-kind donations from the beginning, although it is not listed as an official sponsor. And Microsoft (NASDAQ:MSFT) also sponsors the ASF primarily to help it meet its EU Competition Commission obligations vis a vis Windows interoperability. (By the way, many of the same companies make up the executive committees of the JCP, minus Microsoft plus Red Hat (NYSE:RHT).)
What does that mean for IT investors? Not a lot. The 10-year ASF/JCP relationship was always just a licensing terms and conditions/IP discussion. The relationship among all the players that you would invest in stays the same and might even be considered stronger in that Oracle and IBM had agreed in October to work on a "limited field of use" Java framework project that would compete with the ASF's unlimited use Java framework project. Sun always made it clear that it owned Java. When very late in its history Sun sort of called Java and its other IP "open source," it was a marketing ploy. In fact, most companies that tout open source do so as a marketing ploy, but Sun even went so far as to change its stock symbol to JAVA.
As for the ASF, it sponsors dozens to hundreds (counting projects in incubation) of other open source projects. Some programmers may continue the ASF Java Framework work just for the sport of it. Or Google, which is having its own IP battle with Oracle, might encourage such an effort. But the ASF is likely to move on and use its resources where they are appreciated.
Disclosure: No financial interest in companies mentioned.