A legal battle between Software giant Microsoft and Korea Electric Power Corp. is looming large over the alleged violation of license agreements by the Korean public corporation.
The nation’s largest power firm KEPCO has been revamping power supply systems with MS’ solutions since 1998.
MS reportedly claimed that KEPCO illegally deployed a total of 80,000 MS SQL servers, which are a database management software, and related products for the state-run company’s power supply systems since it bought the first batch of SQL servers and services from the Remond-headquartered firm back in 1998.
It is said that MS would request compensation of up to 56 billion won ($51 million) ― half for violating the licenses and the other half for undue profit it may earn down the road ― from the state-run utility firm.
Microsoft Korea head office in Seoul. (Ahn Hoon/The Korea Herald)
An insider from Microsoft Korea, who wished to remain anonymous because of the sensitivity of this issue, told a local newspaper that “the legal team at MS Korea has decided to take legal action since it has received no response from the utility firm to its offer to compromise.”
Despite the news reports, MS Korea denied any legal action, saying “MS does not have any plan to file a complaint against KEPCO whatsoever related to licensing violations.”
Gearing up for a possible lawsuit, KEPCO is said to have picked local law firm Sejong as its legal adviser.
“The upgrade of the power supply systems is a core project for KEPCO and tied to the company’s future businesses,” an official from the utility company was quoted as saying.
The KEPCO official argued the violation, if true, may not have been intentional, but accidental.
MS has raised legal issues with some domestic companies and government and military organizations in regard to illegal use of its products and services, including the user client access licenses, which grant customers the right to access MS’s servers.
The U.S. company had requested the Ministry of National Defense pay 200 billion won in royalties for using CAL licensing in 2012. The two parties settled the matter by agreeing that the ministry would utilize more licensed MS software products in the future.
MS has also been accusing the National Police Agency of pirating the company’s flagship PC operating system Windows. The police uses Windows for two hard drives ― one for the internal network system and the other for external networks due to security reasons ― on one PC, but pays a single license fee, which according to MS violates the company’s licensing practices.
By Kim Young-won (wone0102@heraldcorp.com)