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Strange partnerships are being forged and broken as heavyweights slug it out in the Linux world. A snapshot of the action and the motives driving the duels.

Strange bedfellows and even stranger foes. That would aptly describe the partnerships forged recently in the Linux world, and the sense of competition heating up in what is seen as a business opportunity.

Oracle started it all in its latest edition of Oracle OpenWorld. Its CEO, Larry Ellison, announced support for Red Hat Linux - minus the trademarks and logos that belong to Red Hat - with prices beginning from about half of what Red Hat itself offers. In effect, Oracle was going to compete with Red Hat for support opportunities. Surprising, since Oracle was an investor in Red Hat in 1999.

So why did Oracle do this? Ellison said that customers wanted high performance, reliability and security from their software and that is why, he said, investment in Linux is needed. "There is lack of true enterprise support for Linux." He explains that if a customer has a bug and a vendor fixes it, the fix is for a future version and not for the current version. "It slows down movement of mission-critical applications to Linux."

This, he says, is not acceptable to customers of Oracle. Cost, he adds, is another dimension that slows down Linux adoption. "Support from a leading Linux vendor could cost you about $1,499 per year for a two-processor server."

Third, he feels is the issue of uncertainty over intellectual property. With the likes of the SCO-IBM legal battle giving users the jitters (SCO had sued IBM claiming that IBM's Linux had code that originally belonged to SCO, but that debate has died down a bit), there was no indemnification available to users against such legal uncertainty. Oracle, he says, would indemnify its users.

So what happens to Red Hat? Would killing them be an unintended side effect, was the poser to Ellison the day he announced this. As Ellison himself says, "We are trying to speed up Linux adoption. We have upped the bar for support. They won't be killed. They'll compete. This is capitalism. Better products at lower prices."

Mixed feelings For all this hullaballoo, Red Hat India is maintaining a stoic silence, save for emailing eWorld a comment from its parent, Red Hat Inc, in response to our queries: "The opportunity for open source just got bigger. Oracle's announcement further validates Red Hat's technical leadership. We will continue to optimise Red Hat Enterprise Linux for Oracle and compete on value and innovation."

Interestingly, there is one entity that is showing a mixture of relief and joy at this upheaval: Microsoft.

Radhesh Balakrishnan, Director, Platform Strategy, Microsoft India, feels that Oracle's onslaught would mean glad tidings for his company. How? "It validates one simple thing: that Intellectual property has value and needs to be protected. That is the cornerstone of Microsoft's philosophy. If you do not respect IP, then you are not creating a sustainable environment for innovation."

His point is that, with Oracle's action, more conversations would be grounded in rationality. "Earlier, it was difficult to reason with people bringing in an emotional aspect to business or pricing."

The good thing, he says, is that the business model is around services, which are replicable. "So, the focus would be on the soundness of the business model rather than on the argument between development philosophy and business model."

So, how exactly would Oracle's action benefit Microsoft? Says Balakrishnan, "The total cost of ownership for the whole bundle from Oracle would be higher. You have to be an Oracle customer to benefit from this pricing for Linux services. Their database (Oracle's flagship product) is not open source."

Compare that with Windows, says he, for which customers are fully indemnified, and on which SQL works.

According to a recent Frost & Sullivan study, commissioned by Microsoft and audited by CapGemini, Microsoft Windows 2003 has the lowest TCO, 22.4 per cent lower than Linux in application servers, whereas for network servers and mail servers the TCO is 11 per cent and 8.24 per cent lower than Linux, respectively.

Ravi Shekhar Pandey, senior analyst with Springboard Research, feels that Oracle's move is not, in any way, an admission that Linux has problems. Linux support does have issues but that's an altogether different story, according to him. "By trying to get into a rival's territory, Oracle is just trying to clone Red Hat's success."

Sure, a rival is meant to whisk away business. However, Oracle's decision is only going to expand the market for Linux, he feels. "The vendor has been working on a plan to get into Linux business for some time. Linux has a history of such developments which are very much part of Linux's open source development culture."

He says that what Oracle is trying to do has already been tried by lesser known entities such as CentOS, and Whitebox Linux, which released their own versions based on Red Hat Enterprise Linux (RHEL) version 4. It is only taking advantage of one of the basic tenets of open source (and in particular the General Public License, under which the Linux kernel is licensed), "that software is free and can be modified, copied and redistributed."

Again, Oracle may not find it easy to challenge Red Hat's technical leadership in Linux. Pandey feels, on the contrary, "Oracle's latest move ratifies Red Hat's primacy in the Linux market and may likely end up solidifying its presence in the market. Just because Oracle is a giant compared to Red Hat will not mean it will be easy for it run away with Red Hat customers in any significant way. Red Hat is very well entrenched in the Linux market and is acknowledged as technology and market leader, a fact which the Oracle move acknowledges."

But what about the cost of support? Oracle's support offerings start at half of Red Hat's. "There is no denying that fact. But, if Oracle is just relying on price undercutting to get into Red Hat's territory then at the most it can just achieve one objective - get Red Hat to match its price. Also, Red Hat has built a business on supporting customers and not selling products. Its core competency is providing support services."

Pricing game
Pandey sees it as just a game of pricing. "It will be interesting to wait and observe how Oracle will offer support services for Red Hat Enterprise Linux 5 (RHEL 5) that's due in early 2007."

But would such a move affect other vendors of Linux? Novell's SuSE Linux for instance? No, says Revathy Kasturi, managing director, West Asia Suse Linux. "It is a good thing for the Linux community that there is more involvement from the big daddies." But, she says, what is more important and a bigger story is the coming together of Microsoft and Novell for a partnership. The two are partnering to ensure interoperability between their respective products. This means that users could run Windows and SuSe Linux on the same machines and switch smoothly between applications running on either. Pandey feels Oracle's entry in the market will surely have an impact on other Linux vendors. "However, we must look at the development in a larger context - that of big proprietary vendors like Oracle and Microsoft acknowledging the power of Linux and then trying their own bit to capture a share of a market or try win over the open source community, as Microsoft perhaps is trying to do with its agreement with Novell.

Meanwhile, the Microsoft - Novell partnership is running into problems. The New York Times reports that less than three weeks after the agreement was signed, the Microsoft CEO, Steve Ballmer, has said that it (the partnership) `"appropriately compensated Microsoft" because Linux "uses our patented intellectual property."' Ron Hovsepian, Novell's CEO, was quick to react. His open letter to the Linux community says, "Some parties have spoken about this patent agreement in a damaging way, and with a perspective that we do not share."

Hovsepian, in the letter, says, "Our agreement with Microsoft is in no way an acknowledgment that Linux infringes upon any Microsoft intellectual property." In a press release, Microsoft says the companies "have agreed to disagree."

There is more to come in this war for the customer's wallet.

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