State of the Market Preview: Linux Gets Critical Mass

Finnish programmer Linus Torvalds says the creation of the Linux operating system is his biggest technological achievement. Good news for the IT legend: his nine-year-old achievement keeps getting bigger.

VARBusiness's State of the Market Research shows that 8 percent of solution providers surveyed said Linux would be their primary operating system in 2001, up from just 2 percent last year. While Linux still has a long way to go before unseating Microsoft's Windows as the OS of choice, the system picked up a great deal of momentum in 2000, courtesy of several software players. Smaller vendors such as Caldera Systems and Red Hat have specialized in Linux and cornered sizeable portions of the market (Red Hat sold nearly half the copies of Linux on the market in 1999, according to IDC.).

However, larger companies such as IBM and Oracle have thrust the underdog OS into the mainstream recently. Big Blue announced new Linux products this month, including a commercial database software and Web-application software for IBM WebSphere. The company also helped Linux's increasing exposure overseas by inking deals this month with convenience store giant Lawson in Japan and Telia, Scandinavia's largest telecommunications and Internet service provider company. Both corporations will begin using IBM's Linux-based servers.

"Linux is seeing increasing usage as part of basic IT infrastructure at many organizations," says IDC vice president Dan Kusnetzky. "IBM has positioned itself well to be considered one of the leading suppliers in this emerging market."

Oracle released its first enterprise-level application server for Linux last August and boasted that 285,000 copies of its database software, Oracle 8i for Linux, were downloaded in the month of July. "The Linux market is reaching critical mass," said Bob Shimp, Oracle's senior director of Internet platform marketing. "Oracle is definitely of the opinion that Linux is ready for enterprise."

Contributing to the widespread adoption of Linux is the fact that the operating system has an open programming code and can be custom-tailored by users. In addition, one copy of Linux, unlike most other OSs, can be installed on as many computers as a customer wants. IDC predicts the market for Linux-based software will increase from just $30 million in 2000 to $3.4 billion in 2004. With that kind of growth, Linux could shatter more than a few Windows in the near future.

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