Intel, Netscape Invest in Red Hat, Linux

Red Hat Software Inc. (Research Triangle Park, N.C., announced that Intel Corp. and Netscape Communications Corp. have taken minority equity positions in the company. Red Hat is a distributor of the Linux operating system.

Venture capital firms Greylock and Benchmark Partners are taking positions in the company as well. Red Hat also announced it is establishing an Enterprise Computing Division that will offer enterprise-grade products and services to support global, mission-critical applications. "As the growing number of users demonstrates, the Linux operating system is ready for enterprise-wide applications," says Robert F. Young, president, Red Hat Software.

The announcement today, which divulged no specific financial details, was made at ISPCON Fall '98 in San Jose, Calif. The companies join Oracle Corp., Informix Software Inc., Computer Associates Int'l Inc., Sybase Inc. and IBM Corp. in investing in Red Hat.

It is unclear at the time, how this announcement will affect Intel's relationship with Microsoft Corp. and their Windows NT workstation. The prospective repercussions could decide the future of Intel and the way they deal with operating systems, software and the companies who design them.

The advantages for Netscape and Intel are more obvious. The companies will be able to strengthen their tools for Web developers who use or want to use the Linux platform.

International Data Corp. (IDC, Framingham, Mass.) estimates between 7.5 million and 10 million copies of Linux are in use world-wide. IDC expects sales from the two top commercial Linux firms, Red Hat and Caldera Systems Inc. (Orem, Utah,, to increase by 43 percent this year.

Linux is a free, fully functional Unix workstation for applications ranging from Internet servers to work group computing. The operating system was originally created in 1991 by then-college student Linus Torvalds. Today, the core product and enhancements, including all source code, are freely available on the Internet under a GPL license. Red Hat distributes their own version of the technology for $50. -- Brian Ploskina, Assistant Editor

About the Author

Scott Bekker is editor in chief of Redmond Channel Partner magazine.