Open Source Business


Author: JT Smith

By: Jack Bryar
The state of the Linux world

The state of the Linux world

IDG’s LinuxWorld is this week. And as the Open Source tribe convenes in San
Jose, the atmosphere should be one of both celebration and paranoia. According
to analysts, there’s plenty of reason for both.

The celebration is justified because Linux has broken
into the
mainstream with a force that not even its most zealous
devotees could
have predicted two years ago.

In 1999, Linux moved into second place for OS
system shipments
behind Microsoft and has kept on going. According to Netcraft, the
British consultancy,
Linux is the most common OS on Internet servers.

During the last year, Linux has become a viable
platform across the
enterprise. Database software developers, particularly
Oracle, have begun
porting their entire enterprise-class software lines to Linux.
Linux-compatible security solutions are being offered by
the likes of Stormix Technologies
and Linux
, who
have developed Linux-optimized firewall and router

The Linux server market continues to grow.
Hewlett-Packard backed Linux
for its server computers. Dell is shipping Linux servers
and recently
designated Linux as a “strategic” operating system. Intel
suggested that
Linux was critical to the success of the company’s
upcoming Itanium

In addition to large systems, the OS is winning a
place in small
devices. Red Hat recently announced a deal with Ericsson
for a new
“open” wireless phone. IBM has suggested that Linux is a
platform for developing intelligent “small pervasive

Regular, everyday users of personal computers are
being promised an
important break by a firm called Eazel. Founded by a
trio of former
Macintosh designers, Eazel claims its upcoming Nautilus
file manager and
system management interface will be far more stable and
just as easy to
use as Windows or the Mac. Nautilus won’t be shipping for
quite a while
yet, but the firm is distributing
lots of pictures
and generating a lot of buzz. Even
financially ill
applications developer Corel Systems has managed to
survive long
enough to generate a
new edition of
its operating system
and a Linux compatible version
of Corel Draw.

Life is good. And yet…

The paranoid still have reason to be deeply concerned.

For one thing, the money necessary to finance this
revolution has yet
to show up. For all the phenomenal growth in the Linux
marketplace over
the last two years, at the end of 1999 Linux sales overall
represented less
than 1% of the revenue generated by server operating
systems globally.
In fact, Linux OS sales in 1999 generated less
cash than
Microsoft’s OS generated by the 4th of January. While
revenues have
skyrocketed since then, they still remain puny compared

And while revenues have grown, so have costs. The rate
of growth
itself has led most companies in this sector to bleed red
Skyrocketing burn rates, along with over-extension, a
dilution of
expertise, management structures running in crisis mode,
and increased
customer complaints are all characteristics of companies that are
growing too fast
, according to experts. Even basic management practices
are difficult to
maintain in the face of rapid growth. And growth has been
explosive. VA
Linux, OSDN’s parent company, is a good illustration of
the size of
the problem. While the number of employees at VA Linux is
still small
compared to many older IT companies, its employee base
exploded, going
from 15 to several hundred.

Companies trying to provide expertise for too many
simultaneously can fail to leave anyone satisfied.
Occasionally key
technical developments may slip right by them. Red Hat
and VA Linux
were recently embarrassed when AMD announced it’s new 64
bit chip, the
“Sledgehammer.” Both firms said they only recently found
out about the
chip, (!) and hadn’t decide what to do about support.
Other firms’
problems were even worse. Turbo Linux suggested its
company had simply
run out of resources and couldn’t manage yet another
Linux port.

Adding to the woes of the Linux start-ups, their very
success has
attracted powerful potential competitors. What does it
say to start-up
vendors of Linux-configured PCs when Linux World’s
keynote address will
be given by former long-time
Microsoft ally
Michael Dell?

Participation in the Linux market by the likes of
Dell, IBM, Gateway, Compaq, and Hewlett-Packard has generated publicity and
given the OS
credibility in key business markets. It represents quite
, for Dell in particular. But the very
participation of
the major computer and software vendors threatens the
direction of the
market and the viability of the has joined the
revolution. These
companies have deep pockets and an extensive customer
base, and their
relationships with Linux entrepreneurs are complex and
likely to grow
more so.

Many of these larger firms continue to be something
less than fully
committed to Linux. Sun Microsystems has simultaneously
several Linux OS vendors even while withholding critical
support and
featuring programs to
encourage would-be
users of Linux programs to stay with proprietary Sun
and HP have also encouraged the development of what might
be called
Linux-over-(proprietary)Unix. IBM recently announced its
newest version
of Unix, AIX 5L (a/k/a Monterey), will include “Linux
APIs” and a “GNU
tool set” designed to encourage users to migrate their
favorite Linux
applications over to AIX. HP announced a future port of the Linux
Environment to their OS that would allow Linux apps to
run “natively”
on HP-UX servers using Intel’s IA-64 platform. Even
Caldera’s Ransom
Love, fresh from his acquisition of Unix vendor SCO, has
made vague
references to combining Linux and Unix into a single
so-called Open
Internet Platform (OIP).

Where all this leads is hard to figure, but skeptics
recall that Unix
was originally conceived as a multi-platform operating
system, but that
Sun, IBM, HP and SCO no sooner signed up as Unix
licensees than they
began to morph Unix into proprietary platforms.

So it may be that the smaller start-ups alone stay the
course. So a
lot will depend on the response of the Linux community at
large. If they
maintain their commitment to Linux and the integrity of
the OS, and
continue to resist dilution and “forking” there’s a very
good chance
that the majority of start-up Linux developers will
manage to survive
long enough to control their costs and their growth rate,
and will be
around for LinuxWorld 2001. IDG said that the show has
grown so rapidly
they’re going to have to move it out of San Jose next
year. They’re very
optimistic. They think Linux is going to be really


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