Red Hat sees boost from SCO suits

Red Hat reports that sales are brisk in Australia and Asia, in part because companies are asking for advice--opening communication channels.

The publicity generated by the SCO lawsuit hasn't hurt Linux distributor Red Hat's plans to expand business in Asia--in fact, it seems to have helped, said a senior executive.

"It has helped open a lot more doors. People don't understand what's going on and that gives us an opportunity to explain," said Harish Pillay, the U.S.-based firm's chief technology architect for the region.

And in Australia, the company claims that they have not lost a single piece of business due to the legal wrangling over the alleged copying of Unix code into the open source Linux operating system.

Leading Linux distributor Red Hat plans to ramp up sales in the region and has added staff. Of the 30 staff at the regional headquarters of Brisbane, Australia, five are new hires, while in Singapore, Pillay has just been added. In India, four of the 20 employees are new.

Red Hat has in the last year adjusted its business from distributor of one variant of Linux to selling, supporting and certifying whole systems based on the open source operating system. In Asia, the company sees an opportunity in placing Intel-Linux-based hardware in data centers, taking over the role that Unix-based database and transaction servers from Hewlett-Packard, IBM and Sun traditionally enjoy.

Pilot projects in various companies around Australia have shown that Intel-based servers running Red Hat's Linux typically deliver three times the performance at one third of the cost of a Unix server, claims Angus Robertson, vice president, South Asia-Pacific.

The bulk of savings come from the use of simpler, off-the-shelf computers compared with proprietary hardware, said Robertson. "The proprietary operating system, such as Solaris is charged per CPU, and is typically quite expensive. The cost of the Linux software is relatively cheap," he said.

IBM, one of the biggest proponents of Linux, had a US$3 billion lawsuit slapped on it from software maker SCO. SCO claimed that its Unix code was copied into IBM's Linux. Since then, SCO said it plans to claim license fees from Linux users who employ versions which contain the disputed code..

In August, Red Hat filed a lawsuit against SCO, seeking actions such as a declaratory judgment that Red Hat has not violated SCO's copyrights or trade secrets. A month later, SCO filed a motion to dismiss the suit, arguing that Red Hat has no grounds to sue SCO, as SCO's actions against the open-source Linux operating system have not specifically targeted Red Hat.

The legal brouhaha's chilling effect on Linux adoption should not be exaggerated, said Robertson. Though Red Hat has made it a policy not to offer advice should Asia buyers ask if license fees demanded by SCO should be paid, he felt customers won't see the stance as neglect of seller's duty. 5059547"In the last five years there have been 20 lawsuits against Microsoft. I don't think that has stopped anyone buying their products, and I don't think they offer legal advice either," he said. 5059547Both Pillay and Robertson felt the relentless sprouting of ever more variants of Linux around Asia, usually prompted by commercial, patriotic or language-support reasons, won't detract from their business. 5059547"It's a win for open source, and a potential win for Red Hat. It grows the market size and if they need our support, we'll definitely look at the opportunity," said Robertson.