Blockchain Project Thinks Microsoft Azure License Agreement Goes Too Far

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The blockchain project New Economic Movement (NEM) has big goals; namely, re-creating the economic system without the predominance of traditional power brokers.

NEM imageAs the project’s website states: “NEM is a movement which aims to create a new economy based on the principles of decentralization, financial freedom, and equality of opportunity.”

The project’s “Proof-of-Importance” model as an alternative to Proof-of-Work and Proof-of-Stake represents its central innovation. Proof-of-Importance calculates how much users transact, and with how many other participants, so as to place a value on the importance of a NEM participant. POI is designed to increase velocity and promote a strong NEM ecosystem.

Also read: Japanese Financial Institutions Partner With Tech Startups For Block chain

NEM recently applied to have their project hosted on Microsoft’s Azure, a cloud computing platform infrastructure  assimilating blockchain projects into its cloud repository. However, the company declined to be featured in the Azure repository after reading the terms of the agreement Microsoft presented.

The open-source project NEM did not like the agreement they would need to sign in order to take part in an Azure project that has onboarded Ethereum, Ripple and others in recent months.

“We spent a considerable amount of time getting this done,” NEM penned in its blog.

Unfortunately, at the last stage of our submission we were shown the agreement. In the agreement, to put our solution up there, requires us to give away all our rights. This is not quite palatable.

The company elaborated: “Having given it due consideration and thoughts, we have decided that NEM should be independent. Instead, we are proposing to still put it on Azure as a docker but we pay for it. By paying for it, we are assuming to be a customer of MS instead. In doing so, we are free from losing our rights as well as still prove that we are able to put it on the Azure cloud and allow testers to work on our solution without NEM losing any rights at all.”

NEM might take issue because parts of its project – nem.peer and nem.nis – remain closed-source. It does not intend to list itself on Azure “unless [Microsoft] waives that agreement.”

An Alternative Sign-Up

Instead NEM will explore a paid addition to Azure, something Microsoft has heretofore not offered. The only features of the project currently open-sourced are licensed under MIT. The project’s wallets are also open-source.

“The application process was straightforward and fairly easy,” NEM spokesperson Jeff McDonald relayed to CCN. “[Al]most any chain should be able to do it.”  A Contribution License Agreement, presented by Microsoft at the end of the process, led the project to cancel its pursuit of being listed on Azure.

“At that time we decided to cancel the pull request to be listed on Azure while the Contribution License Agreement was investigated more deeply,” McDonald told CCN.

Currently, we have a lawyer looking over the form and have contacted Microsoft for clarity on the extent of the [License Agreement].

NEM plans to eventually open-source its entire codebase, including POI and what it claims to be the first P2P synced nodes. NEM incorporated Eigentrust++, a security clustering algorithm which enables nodes to give reputation to their neighbors in clusters, “making it very difficult for a node to give false information consistently to the network.”

Other benefits the project claims are a new kind of transaction spam guard tailored to target specific spam accounts and increase that accounts’ transactions fees, while leaving global transaction fees low.

NEM also claims its multi-signature 2.0 protocol, which “doesn’t make new accounts for a multsig address.

McDonald adds:  “Instead it takes an existing account and makes a contract over it with other accounts. This form of multi-user accounts can make any form of M of N with ease and can also can have the M or the N edited with ease as it is simply just updating the meta data of the blockchain based contract.” By M and N, McDonald refers to a multi-sig arrangement such as two-of-three, three-of-four and so on.

“This form of multisig also has blockchain based notifications, so transactions or updates of the M of N are pushed to the wallets as transactions to sign,” he elucidates. NEM also hopes to offer messaging within its platform.

NEM is mainly looking for clarification from Microsoft. McDonald says they want to know how much of its project would have its license defined by Microsoft’s terms and not by the NEM developers.

When I ask if he believes other projects on Azure – like Ethereum and Ripple – are no longer independent, he declines comment other than, “We think [they] are very interesting projects and we wish them well.”

Images from Shutterstock and NEM.

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