Under the settlement, Microsoft (msft) will pay Sun (sunw) $20 million and is permanently prohibited from using "Java-compatible" trademarks on its products, according to Sun. Sun also gets to terminate the licensing agreement it signed with Microsoft.
For its part, Microsoft is permitted to use a version of Java in Microsoft products that already contain it or are in beta for the next seven years, according to Microsoft.
Java is a software technology that allows a program to run on a multitude of computers without having to be rewritten for each one. Sun sued Microsoft for $35 million in 1997, saying Microsoft breached its contract by trying to extend Java so it would work differently, and presumably better, on Windows computers. Consequently, one of Sun's main arguments in the case was that Microsoft wrongfully advertised that its products were Java-compatible because, in Sun's eyes, they were not. Those changes broke the universality of Java, Sun argued.
"It's pretty simple: This is a victory for our licensees and consumers," Sun Chairman and CEO Scott McNealy said in a prepared statement. "The community wants one Java technology: one brand, one process and one great platform. We've accomplished that, and this agreement further protects the authenticity and value of Sun's Java technology."
Microsoft was equally upbeat.
"This settlement is great news for the industry and Microsoft, as it means we can focus all our resources to help enable the next generation of software with Web services," said Sanjay Parthasarathy, vice president of platform strategy at Microsoft.
"There isn't really a clear winner or loser in this settlement," said Gartner Group analyst David Smith, "but when one company pays the other money, the payee has more of a legitimate claim to victory."
Smith noted that in the long term, developers will be the ultimate winner. "This is a ceasefire, but not peace," he said. "Microsoft has been feeling increasingly strong pain for not having a Java plan."
Smith said he believes it is unlikely that Microsoft will strike a new agreement with Sun for the latest version of Java, called J2EE. But Gartner believes that Microsoft will come around to support some of the new technologies that are part of J2EE, such as JSP (Java Server Pages) servlets, said Smith.
JSP servlets are components which can be assembled into dyanmic web pages. JSPs and servlets are among the key enabling technologies for Sun's web services infrastructure, which the company is slated to unveil on Feb. 5.
Java emerged in the mid-1990s and was immediately hailed as a technology that could greatly affect Microsoft's future, as it allowed developers to create desktop applications that could run on any operating system. As a result, developers would, ideally, not have to dedicate themselves to writing Windows programs to survive.
Although hype outpaced actual Java implementation, the technology has steadily caught on.
The germ of the suit began when Microsoft took out a Java license in 1996. Sun, however, contended Microsoft quickly began to run afoul of the licensing terms. Sun filed the initial lawsuit in October 1997.
"Microsoft has proven time and again that it is unwilling to abide by the common rules of the Internet," Patricia Sueltz, Sun's executive vice president for the software systems group, said in a prepared statement. "Its behavior with regard to the Java technology was just one instance. And when presented with the choice of compatibility or termination, Microsoft chose termination."
