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Technology Stocks : How high will Microsoft fly?
MSFT 488.01+2.0%11:52 AM EST

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To: Al Bearse who started this subject8/15/2001 2:00:09 PM
From: Uncle Frank   of 74651
 
From today's San Jose Mercury News. Note: Dan Gillmor is a charter Apple-phile.

Big Blue places $1 billion bet on Linux

BY DAN GILLMOR
Mercury News Technology Columnist

For about an hour at the start of the IBM
Technical Developer Conference
Tuesday morning, a casual listener might
have been forgiven for thinking he or she
was at another kind of event entirely: a
celebration of the GNU/Linux operating
system.

IBM is investing a huge amount of money
and talent -- a reported $1 billion this
year, including the efforts of hundreds of
employees -- into Linux, as the software
is more generally known. And, as was
evident at the San Francisco conference,
IBM executives are roaming the globe to
boost a technology their company doesn't
own and can't possibly control.

Their fervent salesmanship contrasts, to
put it mildly, with Microsoft's shrill
denunciations of the GNU General Public
License (GPL) model under which Linux
is licensed to users. Microsoft calls this
licensing system -- and Linux by
implication -- a threat to our very system
of capitalism.

Linux is among the software created
under the ``free software'' or, as some call
it, ``open source'' model. These are not
the same thing, but they have some
common features. In both, the source
code, or programming instructions, for the
software are freely available for
modification and redistribution.

The genre has a variety of licensing systems. Much of the
debate centers on the GPL, which is designed to ensure that
anyone who incorporates GPL-licensed code into new
software releases that software under the same terms. In
other words, the new software and its underlying source code
must also be made freely available.

The GPL thus restricts companies' ability to turn
GPL-licensed software like Linux into proprietary products.

IBM is not a socialistic enterprise. So what gives?

It's partly politics, but mostly business. For Microsoft, Linux
may threaten its business model, which is based on its
monopoly of the operating system. For IBM, Linux is useful
both as a technology and competitive strategy.

IBM still sells lots of proprietary software. But Linux has been
a blessing to Big Blue. The very openness of the operating
system is key, said Irving Wladawsky-Berger, vice president
of technology and strategy for the company's Server Group, in
an interview after his Tuesday speech to several thousand
developers.

He noted, in particular, IBM's ability to run Linux on a variety of
hardware platforms, which he called a boon to making
various systems interoperate and in persuading customers
that they will have much more flexibility in their own decisions.

But if it really was ``a cancer'' attacking all commercial
software, as Microsoft Chief Executive Steve Ballmer has
called it, then presumably IBM would also be at risk by using it
so extensively. Maybe, when IBM looks at Microsoft, it thinks
of Linux as an antibody.

Wladawsky-Berger was careful to stick mostly to the
technology of Linux in his keynote speech and a subsequent
interview Tuesday morning. But he had no doubt about why
Microsoft is so anti-GPL.

``Put the dots together,'' he said. ``They don't like Linux, and it
uses the GPL. I think if Linux used some other license, you'd
see that license vilified.'' In other words, it's the competition,
stupid.

Wladawsky-Berger did say, however, that using
GPL-licensed software does involve some careful planning,
to avoid any situation where a company might be forced to
give away its own work -- something that can happen if the
GPL software becomes part of another product. As long as
developers understand the issues, there's no big problem.

For IBM, Linux is a platform play, a wide one. Linux has been
rewritten to run on just about every kind of computing platform,
ranging from IBM's most powerful mainframe machines to
handhelds sold by companies such as Compaq Computer
and Palm. That cross-platform capability is a huge value in a
world where variety still matters.

If any company should be feeling threatened in the near term
by IBM's adoption of Linux, perhaps it should be Sun
Microsystems. Sun has thrived by selling expensive servers --
the powerful computers that dish out information to PCs and
other devices -- that use Sun's Solaris operating system, a
proprietary version of Unix.

Linux, also based on Unix, runs on much less expensive
hardware and has emerged as a serious competitor not just
to Microsoft's server operating systems on Intel-compatible
machines but to other hardware-software combinations. Will
low-cost Linux on ever-cheaper, Intel-based hardware
ultimately be competitive with Sun's top-of-the-line servers?
Sun scoffs at the very notion. Maybe it's right.

``Linux is only a threat if you don't embrace change and adapt
your business model,'' Wladawsky-Berger said. Linux
ultimately could be perceived as a threat to IBM's own
high-end Unix variant, called AIX, he noted.

IBM isn't really challenging Microsoft at the desktop anymore,
not with Linux or anything else. The OS/2 operating system,
architecturally far superior to anything Microsoft was offering
at the time, nonetheless bombed in the marketplace for
reasons that included IBM's own ineptness.

There's only a small market for Linux as a general-purpose
desktop operating system, Wladawsky-Berger said. But for
more specialized workstations, it's gaining strength every
day.

And don't look only at the server market for Linux
applications, he stressed. Information appliances running
embedded Linux will be the scene of much of the action in
coming years.

``It will be more fun to go after that,'' Wladawsky-Berger says.
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