Red Hat Software, which distributes and supports a version of the alternative computer operating system Linux, likely will announce Tuesday that Intel and Netscape Communications, along with a pair of venture capital firms, are buying stakes in it.
The anticipated investments will be a major boost for Linux, a version of the Unix operating system that has been available as free software.
Linux was originally developed in Finland by Linus Torvalds when he was a student at the University of Helsinki. It is now used mostly by engineers and programmers as an alternative to Microsoft's Windows NT software.
Intel (INTC), Netscape (NSCP), and Red Hat all declined to comment on recent reports about the expected investments. However, an industry source confirmed that the companies were indeed close to making an announcement, although the terms and the amount of the investments could not be learned.
Netscape co-founder Marc Andreessen, Intel's vice president of sales and marketing Sean Maloney, Torvalds, and Red Hat chief executive Robert Young will all participate in a panel discussion Tuesday at a trade show for Internet service providers that will address Linux and the business model of open source code.
Released in 1991, Linux has always been free over the Internet. The system runs on Intel-based personal computers and servers. Lately, companies likes Oracle and Netscape have begun developing versions of their products to run on top of Linux, in a move to blunt the influence of Windows NT.
But because the software is free and it not owned by one company, many major corporations are hesitant to use Linux, even though some claim it is more robust and less prone to crashing than Microsoft Windows NT.
"With the right support, Linux could crack the commercial market," said Jon Oltsik, senior analyst at Forrester Research. "The right support means visible vendors there to answer calls when things are not running right, rather than a federated group of software programmers."
Red Hat, based in North Carolina's Research Triangle Park, charges US$50 for its version, Red Hat Linux, and provides customer support. It is also the best-known distributor of Linux at retail.
In recent months, Linux and other free-software programs have gained recognition by major computer makers, which are moving to commercialize the software. In June, IBM said it would distribute and support Apache, another free-software program with a far-flung programmer group.
The commercialization of free software is seen as controversial by some of the programmers who work to improve the products.
Thousands of programmers make changes to Linux and submit their changes to Torvalds, who then adds the worthwhile changes to the source code and leaves the software to be tested again by the community.
"It's a cycle. It's quite different from anything out there," said Michael Masterson, technical director of Taos Mountain, a Unix services and support company in Santa Clara, California. "Some of the hard-core community will say it's a negative thing... it will hurt the artistic process."
Some in the industry may speculate that Intel's investment in a company making another operating system could mean another chink in the so-called "Wintel" duopoly that dominates the industry, but analysts and executives said that Intel is just placing its bets on all promising technologies.
"Will Windows NT even feel the bump? I don't think so," said Martin Marshall, an industry analyst at Zona Research. "I don't think it's an anti-Microsoft play on the part of Intel. Of course Intel would like to show it is not solely dependent on Microsoft."
Copyright© 1998 Reuters Limited.
