Smaller open source start-ups challenge Red Hat, Novell

When Red Hat announced the end of free support for its Linux distribution, the CTO of Mississauga, Ont.-based Farematrix evaluated various alternatives and settled on Debian as the most stable and best supported product.“This has worked out very well with no problems in the last year,” says Krishnan.
Krishnan’s shopping excursion is one story that illustrates a trend in the open source industry. Organizations are looking to cut costs while more vendors are stepping up to the plate with competing products and services. Despite Red Hat’s dominance of the top spot and Novell’s position at No. 2, there is healthy competition in the open source market and companies have more choice — sometimes at a lower cost.
Some Linux users say that though Red Hat is still the No. 1 vendor in open source distribution it can never become the Microsoft of Linux. The company competes on quality of service, not with any form of vendor lock-in with their software. Vendor tie-in is impossible, says Internet consultant Russell McOrmond.
“When clients do not feel they are getting adequate quality support from Red Hat the customer can shop around and get third-party support for existing installations or switch to other standards compliant Linux distributions,” he says.
Krishnan followed that rule. In his company, an online search tool for travel agents, Red Hat was a “pretty good fit” when it was a supported freely downloadable distribution. However, he did not feel the need to continue using Red Hat at the price they were charging. “In rendering my decision, I had enough experience with other free Linux distributions including Debian to switch to an alternative,” says Krishnan.
Enter Novell: Its purchase of SuSE has been seen as an improvement for this distribution. Novell appears to understand that its future is not in the creation of vendor-dependent software, but in being the best support company for vendor-neutral standards for software.
“This has meant that parts of SuSE’s distribution that were not open source have been released to the marketplace, and Novell engineers have been participating at a much greater rate within this marketplace than SuSE has in the past,” says McOrmond.
Linux pundits see, on the strength of revenues, Red Hat is clearly the leader in North America while SuSE has some strength in Europe. But this competition is not happening in a vacuum. Both are fighting in Asia where there are other competitors such as TurboLinux and Red Flag, which comes from China. Research firm IDC identifies more than 100 competitors in the marketplace. However, according to IDC analyst, Dan Kusnetzky, their respective revenues clearly put Red Hat and SuSE as the two market leaders.
Brand recognition is one fuel that keeps Red Hat and Novell at their present respective holding patterns. Although there are many smaller Linux distributors in the marketplace, such as Brazil’s Connectiva, they are unknown to prospective North American customers. North American companies will still opt for the familiar brand, Kusnetzky says.
“Regardless of the fact that it’s really good software, North American companies are not going to select it while they have heard about Red Hat and Novell,” he says.
Despite Red Hat and Novell’s dominance, McOrmond predicts that smaller distributions will get their chance to address the market, particularly as open source gains a reputation in government circles as an alternative to proprietary software.
“Slowly governments worldwide, including the slower ‘developed’ nations, are recognizing the importance of open collaborative development and distribution models to their own and the world economy,” he says.