Sun Introduces Fee Cap for Java 2 EE

Sun Microsystems Inc. this week introduced a new licensing and royalty plan for its Java 2 Enterprise Edition (J2EE) 1.3 specification. The new plan is aimed at eliminating some of the public squabbling that has erupted in the past over fees.

Although Sun refused to disclose financial terms, it said the licensing policy calls for a per-annum cap on royalties and fees that each licensee must pay Sun for access to the Java source code.

Members of the Java Community Process (JCP) executive committee - which comprises 15 software vendors, including Sun, IBM Corp., BEA Systems Inc. and Oracle Corp. - have two weeks to review the licensing terms and submit comments to Sun.

The vendors are also under orders from Sun to not discuss specific licensee terms until the conclusion of the committee review process.

"Sun is not obliged to take these recommendations, but the whole purpose is to arrive at an acceptable set of licensing terms without having a publicly acrimonious debate about it," said Carl Zetie, an analyst at Giga Information Group Inc. in Cambridge, Mass. "Having that debate conducted in the press is not good for Java."

Balance of Power

For J2EE 1.2, the 22 current licensees each negotiated fees separately with Sun. Although Sun's standard J2EE contract calls for application server licensees to pay fees equal to 3 percent of net sales, most vendors negotiated unique licensing contracts, Sun confirmed.

Several vendors had balked at that flat-fee approach after it was announced for J2EE 1.2 licensees, said Rick Saletta, marketing team leader for J2EE. Sun hopes to curb that "backlash" with the new price ceiling structure, he added.

Zetie said Sun's amended policy should quell some of the negative response to J2EE license fees that emerged in the past. But, he added, Sun still needs to do more to share control of the specification process with other vendors. He noted that Sun appoints 10 of the 15 JCP executive committee members, in addition to having veto power and a seat on the committee.

Sun said it's considering decreasing its number of nominees to the JCP - from 10 to nine - in response to criticism from vendors and analysts.

IBM, a JCP executive committee member and longtime Java licensee, said it's still reviewing the new policy terms.

"In the final analysis, Sun has the final word on the technology," said Scott Hebner, director of e-business marketing at IBM. "[That] is inconsistent with the nature of the Internet. Java will prosper more if it becomes a true open standard."

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