May 20, 2002

IBM and Linux: What's really happening

Author: JT Smith

- By Steven J. Vaughan-Nichols -

In February 1999, IBM announced it would support Linux and a
partnership with Red Hat. By July of that year, Advanced
Communication Design
, a developer and OEM of
in-store interactive digital audio and video merchandising systems,
made history by being one of the first companies to deploy a major,
mission critical IBM/Red Hat Linux system. Why? Marco Scibora, ACD's
president explained then it was because "Linux is very reliable,
and its help resources are extremely fast," and also, "now that Linux has
major corporate help support from IBM and other companies, it makes a
great environment for customized programs."
Fast-forward to October 2000: IBM announced it had a grand
operating system unification plan for its servers. Its name was Linux,
and with the partnership of the four major business Linux
distributors, Caldera, Red Hat, SuSE and Turbolinux, IBM made it
happen. Today, there's no modern IBM hardware from laptop to
mainframe that you can't run Linux on.

Now it all seems inevitable. IBM and Linux, Linux and IBM. Today, the
two go together as closely as Microsoft and Windows. But what is IBM
really getting from Linux? How well is the partnership between what
was once seen as the stodgiest of all computer companies and the most
rebellious of all operating systems actually going beyond the ad
campaigns and the constant announcements of new deals?

Those famous billion dollars

The example people usually cite to such a question is IBM's famous
$1 billion spent in 2001 on Linux. The figure is certainly
an impressive one and even more striking, is that Bill Zeitler, IBM's
senior vice president and group executive for eServer, claims: "We've recouped most of it in the first year in sales of software and systems."

What Zeitler didn't say, though, was the billion-dollar figure isn't just Linux, as both Stacy Quandt, Giga Information Group's Open Source analyst, and Dan Kusnetzky, IDC's vice president of system software research, point out. It's for the division that also works on AIX and Caldera's OpenUnix. While the OpenUnix segment is tiny, AIX, the
operating system of choice for the pSeries (aka, RS/6000, POWER
systems) is a very popular mid-range and clustering Unix choice and
competes head to head with Sun's Solaris and HP's HP/UX.

So what is the actual breakdown? IBM's not telling. According to an
IBM senior PR representative, "The $1 billion investment IBM made in
Linux in 2001 was across hardware, software and services. The
investment spanned a number of areas, including development,
marketing, sales, ISV support and advertising worldwide. As for a
breakdown of the investment between AIX and Linux, we don't break the
percentages down to that level."

You'd think IBM must know the numbers, but one is led to think that
while Linux doubtlessly gets hundreds of millions in support, perhaps
even the majority of that billion, that impressive figure doesn't
tell the whole story.

No one doubts Linux's importance to IBM. Even Simon Phipps, Sun's
chief technology evangelist, says, "IBM is selling a lot of Linux."
He also says, "They also have things going on out there
that aren't entirely kosher."

For a specific example, Shahin Khan, Sun's chief competitive officer
writes: "The economics just don't work. IBM claims it is
financially justifiable to consolidate as few as 20 Linux servers on
a z800 (a new zSeries mainframe). With an estimated starting price of
$400,000 for a z800 with a single CPU engine enabled, that claim
seems exaggerated compared to Linux servers that hover in the $1,000
to $2,000 range ... When customers realize Linux on mainframe
utilization will be low, and administration costs have still not been
factored in, you can begin to see how the costs will add up. And
let's not forget the support costs that will need to be purchased,
either from the distributor or IBM Global Services."

Of course, Sun has its own ax to grind here. Still, Quandt observes
that IBM hasn't been forthcoming with where its almost billion
dollar return from Linux has been coming in, either. She
speculates, "Even a few mainframe sales could go a long way
towards explaining that number."

Has IBM been good for Linux development?

Here there can be little doubt. It has
supported porting Linux to its own platforms and development of
device drivers; has made its journaled file system technology available under GPL;
and has supported Linux developers. It's easy to see why many analysts and developers think that IBM is the best friend a Linux programmer can have. And, that's before the money and resources IBM provides to
its Linux distribution partners.

But, as Bruce Perens, HP's senior strategist for Linux and Open
Source, points out, it's not all sweetness and light for IBM, Open
Source, and Linux. He thinks that, "IBM has one huge skeleton in its
closet. Its strategic intellectual property policy is anti-Open
Source. IBM's IP license structure is a fiefdom not responsible to
another and the licensing department has a lot to say. Where does IBM Open
Source and Linux communities and IBM's IP policy groups meet? To me,
they seem to only meet at IBM's CEO."

What Perens fears is that IBM may veer away from Open Source
orthodoxy. While he works for an IBM competitor, he does have a point. In areas other
than Linux, IBM has recently had a checkered history with Open Source
and open standards. For example, IBM and Sun have recently been
fighting over Sun not being allowed to join as a senior member of
the open Web Standards ubergroup, the Web Services Interoperability Organization and over their now slowly settling
fight over open source Java tool development kits. On one side, Sun
was promoting NetBeans, while on the other, IBM was aggressively
moving forward with its new Eclipse platform
. They had the same goal, both Open
Source, but there was a short, nasty political fight, which didn't bring anyone
closer to usable code.

Will IBM back off from its currently Open Source supportive Linux
stance? So far, it doesn't look that way. Its fights with Sun
probably, many observers think, have more to do with its long running
competition with Sun than being able to promote a closed source,
closed standard policy.

Even Perens is quick to point out that IBM and HP's adoption of the
GPL has lead to the two becoming "good collaborators." He adds: "The GPL is the
only thing that ensures that partners can work together.
Traditionally, HP and IBM haven't worked well together, but in Open
Source, we manage to do it." Between Open Source making it possible for IBM to
work with other industry powers and empowering its Linux operation,
it's hard to see IBM going back to its old proprietary ways.

IBM, Linux, and business

Business wise, the case is open and shut. IBM has proven to be a
winner for Linux. As Eric Raymond, co-founder of the Open Source
, says, "Having the biggest technology company in the world
back Linux sent a clear signal to a lot of conservative types at
large corporations who would otherwise have taken longer to pay
serious attention."

Perens agrees, "I like IBM's advertising because it gets me in to see
senators and congress people. Before, they had no idea what Linux was
or that it was important. Now, they do."

Kusnetzky explains the power of IBM in detail. "When most enterprises look for a
new system, the first thing they do is to decide on databases and
tools. The next decision point is what applications will work with
your DBMS and tools for those things we don't want to build for
ourselves. The hardware and operating system are in their third
round. So, for example if Oracle is the database, then products that
don't work well with Oracle don't even show up. Others start with packaged
applications to minimize expenses, and then go to the database, and
only then get vendors in the room, and decide on an operating system
and architecture."

He goes on, "That's why Linux has had trouble entering into
enterprise space. Quite often the Linux suppliers don't have the
relationship with independent software vendors. So when the party is
thrown they don't always get an invitation. Sometimes, Linux may be
better choice, but it may never get a chance. Linux people often
don't have marketing folks, if the decision maker is an engineer or
tech type, then Linux's technology will win out for them. However,
talking technology to the CIO isn't going to work. You have to talk
to Dilbert's boss, not Dilbert. What IBM has done is do a better job
of convincing both Dilbert and Dilbert's boss that Linux is something
they should consider."

And, with IBM, Dilbert, and Dilbert's boss, all interested in Linux,
Linux finally is showing up in places beyond Web servers and departmental
file/print servers. But where exactly are IBM, Linux and partners going? We've already examined IBM's mainframe strategy for Linux; look for stories about Linux on IBM's other platforms soon.


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