# I believe that the most significant form of UNIX competition today is from an operating system called Linux (a UNIX clone). Linux is the creation of Linus Torvalds, at the time a student in Finland who started a project to re-write UNIX without using code from the original AT&T version.
In October 1991, Mr. Torvalds put the fledgling code into the public domain and then enlisted help from other developers, an endeavor made easier by the rapidly increasing use of the Internet. Today, Linux is an operating system that consists of several million lines of code—comparable in size, capability, and complexity to Microsoft’s Windows 98 and Windows NT operating systems.
# Linux runs on many popular microprocessor architectures, such as Intel’s x86, Compaq’s Alpha, Silicon Graphic’s MIPS, Motorola’s PowerPC and Sun’s SPARC. Intel is reportedly also assisting in the development of a version of Linux for Intel’s new 64-bit Merced microprocessor architecture. In addition to running on many microprocessor architectures, Linux has a number of other competitive advantages, including the fact that it is free and perceived to be "cool" (a significant factor among "early adopters" who recommend new technologies to others).
# Signs that Linux is generating the kind of enthusiasm that can make an operating system successful abound. Over the past year, for example, usage of Linux has surged, particularly in the influential academic community. Observers estimate that five to ten million people currently use the operating system on personal computers or workstations, and that number is growing rapidly. Linux is also popular as server software, especially among Internet service providers.
# While the number of Linux users is still modest compared to the number of Windows users, popular software products can gain usage share extremely rapidly. For example, use of Netscape’s Web browsing software went from zero to about 70 million in three years, based on Netscape’s published figures.
# Applications support for Linux is also growing rapidly. Within the past few months, leading software vendors have announced that they will create Linux versions of their flagship products. For example, the leading database vendor, Oracle, recently announced that it is developing a Linux version of its market-leading Oracle 8 database.
One of Oracle’s chief database rivals, Informix, quickly followed suit, and Mr. Soyring testified that IBM is porting its principal database product, DB2, to Linux as well. (In fact, IBM announced on November 20, 1998 that its Linux version of DB2 will be free.)
Netscape is developing Linux versions of its enterprise server software, and most of Netscape’s client software is already available for Linux. Corel offers a Linux version of its popular WordPerfect suite of business productivity applications, and it is free. Star Division of Germany offers its StarOffice, a full suite of business productivity applications. StarOffice, recently priced at about $300, is now free for individual users. Sun is porting its Java Development Kit 1.2 to Linux.
# Commercial software vendors such as Red Hat and Caldera now offer compatible versions of Linux at a nominal charge. Although Linux can be and routinely is downloaded for free off the Internet, Red Hat and Caldera plan to earn revenues from related software and services such as training and support. The presence of such supported versions of Linux promises to make the operating system more appealing to corporate customers.
# Caldera offers a product called OpenLinux that consists of the base Linux operating system, a graphical user interface called KDE (which includes a tightly integrated Web browser), the DR-DOS operating system, the popular Apache Web server, Netscape Communicator, software that provides interoperability with Novell NetWare, StarOffice and other software. The price for this entire package of software is just $59.
# We have provided the Court with a short videotaped demonstration of Caldera’s OpenLinux running on a standard Intel x86 personal computer and supporting desktop productivity applications very similar to those commonly used today, including StarOffice. (See DX 2164.)
StarOffice is a suite of business productivity applications that closely emulates the features, functionality and appearance of Microsoft Office, making it relatively easy for customers who are used to Microsoft Office running on Windows to switch to StarOffice running on Linux (or one of the many other platforms for which it is available, such as Sun Microsystems’ Solaris, IBM’s OS/2 and the Apple Macintosh). StarOffice can be downloaded from the Web free for individual (non-commercial) use.
# Red Hat offers a similar package of Linux software at very low prices. Red Hat’s chief executive officer, Robert Young, recently stated that Red Hat’s objective is "to lower the value of the operating system market." He added: "Microsoft makes $5 billion in operating system sales. If I get that market, I automatically make it a $500 million market." (The New York Times, September 28, 1998.) Intel and Netscape each recently signaled their enthusiasm for Linux by investing in Red Hat.
# Other members of the industry are equally enthusiastic about Linux. An Informix manager, Steve Lambright, recently stated: "We see Linux poised in the same vein as the Web was two or three years ago, when it was just beginning to take off." (See DX 2249.) Such views are becoming commonplace. Just last month, Marc Andreessen of Netscape stated that Linux is "extremely hot," observing that "[it] is free, it’s stable, it’s fast and scalable, it’s UNIX, it’s the OS of choice on the Internet, and it runs on cheap Intel hardware." (See DX 2250.) Indeed, Mr. Andreessen stated a few months ago that the combination of Netscape Communicator and Linux could be the software that unseats Windows.
# Leading computer manufacturers such as Sun Microsystems, Dell, Gateway, Toshiba, IBM and Hitachi are now offering (or have announced that they soon will offer) computers with Linux preinstalled, and many smaller computer manufacturers offer Linux workstations as well. Other computer manufacturers are likely to follow suit. This month at MacWorld in San Francisco, Linux PPC Inc. announced the latest release of its version of Linux for Apple computers (called "LinuxPPC").
Apple has also developed a version of Linux for its computers, called "mklinux." Even software publishers are getting into the act: Corel Computer will soon offer a new line of personal computers called "Netwinder LC" (the "LC" stands for "Linux Computer"). The Netwinder is a personal computer running Linux and equipped, of course, with Corel’s flagship WordPerfect suite of business productivity applications (as well as Netscape Communicator 4.5). In short, Linux is a product that Microsoft and other operating system publishers ignore at their peril.
# Linux exemplifies many of the characteristics that make the software industry so competitive—particularly ease of entry. The first version of Linux was created not by a commercial enterprise, but by a lone developer while still in school. Since then, developers all over the world, collaborating via the Internet, have improved the operating system by leaps and bounds. Today the number of developers working on improving Linux vastly exceeds the number of Microsoft developers working on Windows NT. Linux developers are currently working on "Windows-like" user interfaces—"Gnome" and "KDE"—to simplify its operation.
# It is unlikely in any other established industry that a single person, aided only by independent volunteers, could create a product that would emerge to challenge the industry leader. Yet this is the story of Linux, and the nature of the software business.