Rx for Linux: Part 3 - Licensing clarity

Rx for Linux: Part 3 - Licensing clarity

Summary: Linux is confused: it's free, but IBM wants you to pay Red Hat $1,499 per yearto run it on even a small Power5 machine.

TOPICS: Open Source
One of the problems Joe Junior IT manager faces when contemplating Linux is that there's no obvious clarity in OS and licensing policy. Linux is free, but costs $799 per year per machine. As in, huh?

In comparision Microsoft's position is clear: everything has a price, on which some people get a small break under some circumstances. Sun's position is clear: buy the media kit for $49.95 or download and install Solaris at the cost of a free registration. BSD's positions are clear - the product is free, but you can buy media packs if you want to. Apple's position is clear: Darwin is free, the MacOS X integrated shell costs you a combined media and licensing fee to install.

Linux is confused: it's free, but IBM wants you to pay Red Hat $1,499 per year to run it on even a small Power5 machine. Here's part of their description of the deal they offer:


For the convenience of clients, IBM provides the ability to order a full retail distribution of RHEL AS 3 in conjunction with any eServer p5, OpenPower or pSeries system purchase or hardware processor upgrade. IBM will ship the RHEL 3 media to the client, pursuant to a license agreement between Red Hat and the client. Clients have the option of ordering RHEL 3 directly from Red Hat, Inc. or their distributors. ...


The Red Hat license agreement defines the RHEL AS 3 charge unit as per install, meaning that a license is required for each server or LPAR on which RHEL AS 3 is installed. In the case of systems configured with LPARs, additional RHEL AS 3 licenses must be ordered for each LPAR running RHEL AS 3. The Red Hat license agreement is available at http://www.redhat.com/licenses/rhel_us_3.html.

Red Hat's site is fairly clear about the proposition that you're really buying their support rather than a Linux license but, for Joe Junior, that's a distinction without a difference. What Joe Junior sees is that IBM will ship him the Linux media "pursuant to a license agreement between Red Hat and the client."

What Red Hat and IBM (and to a lesser extent Novel) have done here is embed an obvious lie - that they're selling support with free licenses instead of licenses with some support - right at the pivotable point in the tire kicker's Linux decision process. We don't know what the consequences have been, but my guess is that they've been two fold: turning some people off Linux, and supporting Linux sales to people who are so used to Microsoft's way of doing things that this looks perfectly natural - and in whose hands Linux does not generally prosper.

Red Hat could fix this, of course, by breaking itself up into a GPL developer on one side and a multi-distribution contractual Linux support organization on the other, but I don't see their management doing that. What seems more likely, instead, is that they won't change until forced to - perhaps when, right after the SCO mess gets settled, someone publically installs Red Hat's enterprise Linux products on a few hundred unlicensed production servers, invites Red Hat to sue them, and then launches a class action in favor of all Red Hat licensees alleging that the use of licenses in place of contracts amounts to an inappropriate means of coercing support sales

Until the world changes, however, Red Hat will continue to be the best free product you can get for only $799 - and Joe Junior will continue to shy away.

Paul Murphy's Linux Rx-- see the full series:

  • Part 1: Measurements and markets
  • Part 2: SCO, patents and money
  • Part 3: Licensing clarity
  • Part 4: Community support
  • Part 5: Executive support

  • Topic: Open Source

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    • You're leaving out some other pretty obvious options

      Joe Junior can also choose No OS, and install CentOS on his own, which is an exact duplicate of RHEL without any fee and without any support, and he can find support on his own. So Joe Junior actually has a choice as to whether he wants to pay someone else for support or do it on his own or hire a local shop to do it cheaper than Red Hat will, a selection of choices that none of those other OSes give you.

      Also, you list BSD as free, but what you don't mention is that you're in the same boat with BSD as you are with Linux. You get it free with no support, or you have to provide your own support, or you have to subcontract that out to someone else. Yes, those are EXACTLY the same options you have as you do with Linux, and if Joe Junior had even half a brain he'd know that (I notice you uave to invent these characters, because it must be difficult to find any real IT pros who don't know the facts).
      Michael Kelly
      • Management motivations

        Management wants the proverbial "One throat to choke" when it comes to IT support. That one throat will NOT be their own! i.e. large companies will NOT support Linux by themselves. In the grand scheme of things, hardware and OS support costs are minimal compared to application software (Oracle, PeopleSoft, Siebel, BEA). But for small business - the ones that are most likely to try the leap to Linux - the hardware/OS costs are non-trivial. This provides the strong DISincentive that Murph is talking about. Company "F" is going strong with paying IBM through the nose for Linux (and AIX), but that is NOT what mom and pop want to do.
        Roger Ramjet
        • Can you honestly say

          that Mom and Pop be paying more for IBM/Red Hat than any other choice? If they need support (and I agree with you, they SHOULD get it), that will have to be paid for somehow, and I don't see how it'll be cheaper with any other OS. With proprietary OSes, you have to pay for licensing, configuration, AND support, with F/OSS OSes like Linux and BSD you only need to only pay for configuration and support. So once I look at all the facts, and not just the facts singled out by fans of proprietary software, I still don't see the disincentive.
          Michael Kelly
          • No disincentive - just no incentive

            After hearing that Linux is "free", and deciding to take on the support duties yourself - and then finding out that IBM FORCES you to pay for RedHat service, just isn't an incentive.
            Roger Ramjet
            • Forcing you?

              Go check out Paul's link to the purchase page. I see an option for no operating system. Don't you see it? There's also an option to use SuSE instead. I don't see how IBM is forcing you to do anything, in fact they are giving you a plethora of choices.
              Michael Kelly
            • Methinks Mr. Kelly is right...

              IBM is not coercing anyone, and certainly they are not coercing anyone to a greater degree than Dell, Gateway, etc., and all the other OEMs who offer windows preloaded.
              Any how about it, Loverock? Any official fanboy observations?
    • Make that 800 bucks for each processor

      IBM offers X-series servers with up to 8 processors = 8 x $800 = $6400/year. And if you want to virtualize those CPUs, you can get a copy of VMWare server for $15000. Looking at that, Windoze looks mighty attractive . . .
      Roger Ramjet
      • Will MS give you the same kind of support for less money?

        If yes, then I agree, Windows does look more attractive. But if the price you are looking at is just licensing, and you still have to worry about support down the road, then the costs of Windows doesn't look so good in comparison.
        Michael Kelly
        • Windows support is very cheap

          We pay $450 per copy of Windows server 2003 standard edition. That's a one time fee.

          For support, we pay nothing. If we have a problem with ANY Microsoft technology including Exchange and Active Directory (This happens about 4 times a year at most), we open a case with them for $250. For $250, they will work it as long as it takes to fix the problem. That's 5 minutes or 5 months, it's still $250. If they can't fix it, they don't charge you. We might spend $1000 total per year.

          So yes, this is a very good deal for us.
          • $245 For Support Only

            If you have a software Assurance ID (Means you have to subscribe to license 6.0) and you need Profesional Developer Issue Resolution (EG; You think you found a bug). It's $99.00 for the online version. You can purchase a 5-call pack for about $1200

            For MS Advisory suport it is $210 per hour.

            If you have Premium Support or Essential Support the costs varry and between if you are at level A, B, C, or D for essential and for premium support it depends on what you type of support you have customized.

            Also for support of older software, such as SQL Server 7.0, it is $195 per Issue.

            Individual support the installation support is free for Windows or Office and you used to be allowed one support call within 90 days and $35 for each one after the 1 or after 90 days.

            Profesional support tends to be fairly good however Individual support sucks eggs. They tend to follow a script and blame either a Virus, Spyware, or the OEM.

            Also it is interesting- Anyone who guessed that support for MS products is around $250 is a developer of MS Windows products...
          • As usual

            georgy porgy is comparing apples and oranges. All you MS shills constantly hold up Red Hat as the only Linux distro available. Why are you so afraid of people knowing the truth? There are many options. Even more interesting, why do you always leave out the important MS licensing costs? That $450 server license is not going to do you much good without a stack of client licenses, is it? How much are they now? $70.00 per machine? What if you want mail? $$Thousands more plus another $70.00 per client? What about a database for a web server? Another $10,000.00 per processor?

            MS looks good until you start to add up the cost of all the additional licenses you must buy to make it useful. Of course you dorky MS shills don't want everyone to know about that, do you?

            I don't believe you when you claim MS does not charge you unless they fix the problem. If that is true then why is the first question out of their mouth, "What is your credit card number?". I tried MS support three times. Three times they did not fix the problem. Three times they charged the same. Every time their solution was the same...its the other software you have loaded causing the problem. It is bad enough when you MS shills mislead people with you omission of facts. Why must you lie? Is MS that desperate? Are you? If you did not want to hide the truth why lie? Oh, BTW, support for the MS servers was $6,000.00 per processor per year. More than twice the Red Hat price. Not a real good bargain. MS office was $80,000.00. I got stuck with the task of deciding which two staff members to fire so the management could have MS office.

            MS does not compete on merit. It does not compete on price. If it did you MS shills wouldn't feel the need to lie about it so much, would you?

            All you MS shills here are constantly trying to BS people about Linux. Tell me, how many have you convinced to stay with MS? None? Go tell chairman billy he needs to spend his shill salaries making his stuff better. Put all the lipstick on a pig you want. It is still a pig.
      • VMWare

        [i]And if you want to virtualize those CPUs, you can get a copy of VMWare server for $15000.[/i]

        Yeah, but the Microsoft version isn't any cheaper. Yes, there are other options -- including Xen for Red Hat, which is both [i]libre[/i] and [i]gratis[/i]. IIRC, it's even included in RHEL AS.
        Yagotta B. Kidding
      • Price should not be the only consideration...

        Money/Price is important -- no question. However, if it were the only consideration; you should be looking at "free" linux distros -- such as Debian, Fedora, and OpenSUSE. In my book, you get a lot of value from these commercial distros (Red Hat and Novell SUSE)... not only 24x7 support, but also comprehensive training, relationships with hardware and application vendors which can be leveraged, and add-on products to solve my technology issues.

        All of that, plus the security, flexibility and reliability of the linux platform... which is not available on Windoze.
    • Ok, I'll take door number three .....

      All my Linux customers machine come to me for configuration. I spell out VERY cleary what the fee's are for. No charge for the OS. A desktop installation and configuration fee, a SERVER installation and configuration fee. Sendmail, Database install and setup, migration fee's ARE all clearly made up front.

      My fee schedule also includes delivery and installation at the customer's premise.

      Some want a maintenance / upgrade contract, to which (on new install's ) I tend to tell them to wait to see how things go. Generally, they find they are now out of the old-M$ loop and do not require such fee's services.

      If I depended on the MS model of doing business in the LINUX world, I would be broke. Truth is, after getting comfortable (the cleints) with LINUX, I tend to do a WHOLE lot of larger projects for them - Setting up Mail servers, web servers, etc.. because they can now afford these services.

      SO they lesson here is pure "Bidness" 101 for Linux:

      A: Tell them the OS is free.

      B: Spell out what your services fees are and what they get for said fees.

      C: Make sure they understand that adding additonal software, is not going to cost them anything, but they are PAYING for your expertise and time.

      D; Warranty your work. It makes them feel better and generally you do not have to do anything (Provided you are a *KEY WORD HERE* a decent and competent admin).
      • Absolutely Right-

        And I think you'll like tomorrow's blog
    • The license is clear

      ... it's just that nobody reads it.

      Red Hat makes it [b]very[/b] clear in their license what files the user can copy to an unlicensed machine and which can't; they even provide explicit instructions for making a complete RHEL-less-Red-Hat sytem.

      The only obstacle to cloning an RHEL machine to every box you own is that RH has [i]trademarked[/i] files on the system that they can't allow to be freely distributed without losing their trademarks.

      Thanks for spreading the FUD, Paul.
      Yagotta B. Kidding
    • Most people don't like paying for support

      Or do they?

      There's huge sales in extended warranties. So maybe people do like paying for support.

      When you buy Windows XP you get a little support if you want to call it that. Sure there is Tech Net but is that of any use to home user. Try calling Microsoft support when you have a Windows XP problem and it's $400 billed to your credit card. If the problem is deemed a Microsoft problem then you are refunded but you get to pay up front first.

      Most software has a licensing fee and a yearly support and maintenance fee. Where Linux has a shot at being cheaper is there is no up front licensing fee. So you can have a Desktop OS with no licensing fee and no CAL licensing fee.

      If you want support you then compare the cost of Linux Support to the cost of say Windows licenses and support over a span of time. Then base a decision on what is cheaper. In some case Linux with support can be more expensive.
      • I wouldn't call the Microsoft Knowledge Base Library...

        ... little support. It has over 900,000 articles, and you can fix it yourself using a little legwork.

        Unfortunately, we live in a society that demands instant gratification and does not reward hard work.

        Have a problem or an error message, copy the error message into the MSKB search window and hit enter. 99.99% of the time, the fix is there and you can do it yourself.

        Or, as the Linux folks are fond of saying, post your problem to an Internet News Group (Microsoft has its own server msnews.microsoft.com) and wait for a volunteer (like me) to answer your question, usually within the same day.
        Confused by religion
      • Way off with the price

        Home users pay $35 per incident. Developers only pay $245 per incident. Where did you get $400 from?

        Home users

        • We've allways payed $245.00

          We've only has to call Microsoft about two or three times in the last six years, and every time it's been a flat fee of $245.00. One time, for that flat fee, they actually sent people to our location to troubleshoot the problem. To me, that doesn't seem like a bad deal at all for businesses.