Bold assertions aside, Red Hat is in a very strong position, said WR Hambrecht analyst Prakesh
Patel. "It's by far the best-branded open-source company out there," and Patel predicted it would
beat Linux computer maker VA Linux Systems in the race to attain profitability.
In particular, Patel lauded Red Hat's push to sell
subscriptions to software update services. The new
service, which is offered for servers, workstations
and Linux-based Internet gadgets, could account for
as much as half of Red Hat's revenue in six
months, he predicted.
Also at the conference, VA chief executive Larry
Augustin said his company expects it will be
profitable within 15 months. "We expect to reach
breakeven no later than the end of calendar 2001,"
he said.
Most of VA's revenues come from selling
computers. In the long term, VA expects that to be
75 percent, with 15 percent from services, such as
consulting to help companies plug into the
open-source movement, and a further 10 percent
from sponsorship and advertisements on VA's list of
Web sites such as SourceForge.net, Linux.com or
Slashdot.org. Augustin said the company's Web sites had 3 million unique users and 80 million
page views in September.
VA leads Linux companies in revenue, reporting $50.7 million in its most recent quarter. Red Hat
had $18.5 million in revenue in its most recent quarter. |
