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Copyright Reuters 1998, as follows:
Here is a great investment tip for everyone! Try to get your hands on some
stock, for sure. Don't say I never gave you a good stock tip.
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September 29, 1998
Intel, Netscape take stake in little software firm
SAN JOSE, Calif. (Reuters) - While Microsoft Corp. software still dominates
the computer world, some big Silicon Valley names are putting money into a
small North Carolina company that offers the alternative Linux operating
system.
Intel Corp., Netscape Communications Corp. and two venture capital firms
on Tuesday said they were investing in Red Hat Software
Inc., which distributes Linux, in a move that helps make the emerging
software more competitive with Microsoft's.
Linux, developed by a Finnish programmer in 1991 and since given away
around the Internet world as "freeware," is a version of the
UNIX operating system for networked computers that runs on Intel-based PCs
and servers.
Worldwide, there are about eight million users of Linux, whose biggest
market is among Internet service providers. The software
typically is upgraded by a network of programmers who submit their changes
and ideas to the Finnish programmer Linus Torvalds, but
no company owns Linux.
Intel, the world's top computer chip maker, and Netscape, which competes
against Microsoft in the Internet browser market, did not
disclose the amount of their investments, nor did the two venture firms --
Greylock of Boston and Benchmark Partners of Menlo Park,
Calif.
Since its first release over the Internet by Torvalds, Linux has been
given away as "freeware" and has not made much headway in big
corporations. But in the past two months, several major companies have said
they would support Linux, including Oracle Corp., Sybase
Inc., Computer Associates and International Business Machines Corp.
"Everyone gets the feeling that this is an overnight phenomenon," Torvalds
said on a panel at the IPSCON conference for Internet
service providers. "But it's been around for seven years," said Torvalds,
who created the software while a student at the University of
Helsinki.
"In early 92, the user base went from five long-haired hacker guys to 100,
that was a surprise," Torvalds said. While Torvalds still
manages the "kernel" and the source code of the operating system, he now
works in the United States at a Silicon Valley semiconductor
startup, called TransMeta Corp.
Red Hat, based in Research Triangle Park, N.C., sells Red Hat Linux for
$50 and is the largest of several companies to provide support
and service for the software.
John Paul, a senior vice president at Netscape, said he believed that
Linux had market momentum right now, adding that some
customers were "coming out of the closet" and admitting that they run Linux
in some places in their company.
"I predict that Linux will continue to grow faster than (Microsoft Corp.'s
Windows) NT," Paul said. "We will have more competition in
the operating systems market."
But because one single company does not own or manage the software, there
is a perception that there is no support, even though the
panelists said that the vast network of programmers who work to improve
Linux find, test and patch bugs faster than most companies
even admit to bugs in other software products.
Red Hat hopes to change this perception. With its investments, Red Hat is
starting an enterprise computing division, to support large
corporate customers using Linux.
"The reason for this round of investment is to boost our presence in the
enterprise market," said Robert Young, president of Red Hat.
Analysts said the investments by Intel and Netscape were a big boost for
Linux and added more credibility to the software that is
gradually beginning to compete against Windows NT.
Fans of the software say it is robust and secure and not as prone to
crashing as Windows NT. Linux competes directly with Windows
NT and with Santa Cruz Operation's version of UNIX that runs on Intel PCs
and servers.
Intel, which is a close partner with Microsoft, said its investment in Red
Hat was part of its goal to ensure that most operating systems
run on Intel architecture. An executive said its deal was not indicative of
a rift in its relationship with Microsoft, despite rampant industry
speculation.
"We still have incredibly deep cooperation with Microsoft," Sean Maloney,
a corporate vice president of sales at Intel, told reporters.
"But it is not mutually exclusive."
In a Securities and Exchange Commission filing last week, Microsoft said
it expected to see more competition from rival operating
systems such as Linux and another known as Apache.
"Freeware is making inroads into the glasshouse," Microsoft President
Steve Ballmer said at the Seybold Publishing conference earlier
this month. "Are we worried about Linux and Apache?... Sure we are worried."
______________________________________________________________________________
Now what do you think about that statement from one of Microsoft's billionaires?
Good trading and best',
Michael Paauwe
mpaauwe@xxxxxxxxxx
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