March 28, 2001

CeBit's Linux blues: Press asks, 'Will it sell?'

Author: JT Smith

- by Jack Bryar -
Open Source Business -

I've been reading the European and Asian Tech press this week.
The CeBit show at Hannover,
Germany, was a success. The Linux products there
showed
well. By all accounts it should have been the best week for the
platform in
better than a year. So why did I get so depressed?

I've been following the European and Asian trade papers following
the
CeBit computer show. And the reports I've read are
just
as confusing as ever. Linux-based products were a big deal this year,
bigger
than they have been since the first wave on Linux hype crested and
crashed.
In fact, Linux PDAs were the talk of the show. And yet, all the
reporting I
saw was tinged with negative commentary. Most of the negative remarks
boiled
down to doubt that, good as these products were, they'd ever sell. The
common thread to all the commentary is, "Gee, I really like that
[thing], I
wonder if anyone will EVER write any applications for it?"

This is a serious issue at several different levels.

Negative commentary of this kind is hard to fight. If the Linux
market
was originally financed by the hallucinatory speculative fantasies of
Open
Source fanatics, today's equally unrealistic pessimism makes it hard
for
even the most promising product to get a fair evaluation.

If the market is telling developers that building best-of-breed
products
doesn't matter, then the larger tech market is in real trouble.

The most bothersome aspect of this kind of press response is just
how
completely unfair and irrational it is. Sure there's little in the way
of
applications software for Linux PDAs. Until recently the
hardware
didn't exist. For example, Taiwan's Mitac is effectively the first to
actually come to market with a functional PDA. Sharp plans to hit the
market
too, but its new Linux-compatible PDA isn't expected to hit its home
market for another eight months. And a lot of other equipment has been
shown but
hasn't shipped. It takes time to write code, test it and bring it to
market
until there is an available working platform.

Admittedly, this isn't the only reason that applications are
lacking.
Linux PDAs have the same problem Linux desktop PCs have. There is
already a
market leader in the space with a stranglehold on the market. While
Linux,
Symbian's EPOC, and Microsoft Windows CE may be contending for a spot in
the
marketplace, there is already an effective standard platform here --
the
Palm OS. And, and as Microsoft has proved over the years, it's nearly
impossible to dislodge an operating system from a position of
dominance, no
matter how badly the system functions, and no matter how badly the
company
behaves.

People write applications for the largest platforms first -- because
that
only makes business sense. Once those applications are in place, the
average
user will find it hard to avoid buying systems based on that platform-
because ultimately it's the applications that make the systems
valuable. And
that fact makes it nearly impossible for minor systems to remain
viable. If
no one develops applications, no one buys. If no one buys -- no one
develops
applications. It's a vicious spiral.

The fact that Linux hasn't been killed off in this market, nor on
the PC
desktop, is a tribute to the Open Source platform and the league of
enthusiasts that continue to champion it. But -- it is naive to think
that
Linux it won't be profoundly affected, even marginalized, in this market
as
the market consolidates on a single standard platform.

Linux has a similar problem in the enterprise environment. Anyone
want to
argue that Linux isn't -- by every measure -- a better platform for the
enterprise than anything coming out of Redmond? Not me. Not most
and
resellers and VARs. But the superiority of the platform doesn't matter.
Applications
do. And once again, there's a real shortfall in the apps department.

Resellers and VARs keep saying the same thing about Linux. According
to
the most recent edition of Electronic Commerce News, they like the
platform.
They like it a lot. They like its stability. They love the low, even
free,
price point. They like the fact that neither they nor their end-users
get
locked into a proprietary data platform. They like the fact that they
can
tweak the software as much as they want. The majority of them think
someone
should build out a Linux solution set, especially in the small-to
mid-sized
business market. There's genuine enthusiasm for Linux cluster servers
and
rapidly accelerating demand for clustering technology, at least in
principle.

But, personally? These resellers said they weren't willing to devote
the
time and money needed to learn the platform and become certified. Why?
According to a survey conducted by Computer Resellers News, resellers
and
VARs aren't sure there will be a suite of enterprise applications
capable of
driving demand outside of the niche Web server space. But, of course
these
resellers and VARs are the demand generators. They do the
installing and the recommending. They do the customizing and
integrating
needed to make an application suite run effectively throughout an
enterprise. But if they hold back, developers won't materialize. It's
another vicious spiral.

Perhaps it's not too late. Perhaps an application suite rollout by
an
industry leader like IBM could turn things around. But even that might
not
be enough. According to rumors floating out of Armonk, Big Blue has
been
running into big resistance from its resellers when it comes to Linux.
According to vendors at IBM's third annual Link_2001 Supply Chain
Management
Conference, resellers were more than happy to sit on their hands, and
to let
their competitors test the Linux market first.

This bad news for the overall Linux market has proved to be good
news for
firms like Red Hat. The company had a flat quarter, but thanks to its
services business, it was actually able to make money on the revenue it
generated. It isn't alone. A number of small independent Linux-based
integration shops and alternative platforms specialists are making a go
of
it, even if they are not exactly thriving.

But the installed base of applications on other platforms is tough
to
overcome. Hate Windows? Join a growing club. But corporations of Microsoft
haters aren't expressing their hate by buying Linux solutions. Like so
many
of their colleagues, suddenly, they aren't buying anything at all. It's
one
of the great under-reported stories of the high tech stall-out of 2001.
And
if Palm manages to pull a Microsoft, and alienates their user base in a
similar way -- even stalling out the entire PDA market -- it doesn't
necessarily
mean that any of those users are going to migrate to a Linux
environment.

That is a reason for pessimism.

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