Which open-source companies to go under?

Channel Insider wants us to believe that a range of technology companies may cease operations in 2009, including two open-source companies, but evidence suggests otherwise.

Channel Insider has a tasty headline, "Tech Vendors That May Not Survive 2009," with two open-source vendors included in its list of companies destined to be downtrodden this year. But it turns out that the predictions of pending disaster, as suggested by a group of solutions providers that it surveyed, offer more pomp than circumstance.

Novell and Sun Microsystems make the list, but so do a host of other impressive technology companies, including Symantec, NetApp, VMware, and McAfee. Not bad company to keep.

Of Sun Microsystems, which got 16 percent of the solution providers' votes as likely to go under in 2009, Channel Insider writes:

Some say the (Sun) reorg is a prelude to a sale. Possible, but who has the cash? There's also the possibility of an infusion of capital from Java-dependent Asian conglomerates.

That's hardly a strong endorsement of Sun's demise, but rather an indication of the various parties that have a stake in seeing Sun survive. The same is true of Novell, which got a 25 percent "it's going down" vote:

Novell being sold to or merging with another company would not come as a shock. Going out of business, however, is unlikely. (Why? Because it) is in Microsoft's strategic interests to keep Novell in play as a satellite entity to slow Red Hat's momentum.

It's not just Microsoft that has an interest in Novell's continued existence. IBM, Dell, Hewlett-Packard, and Oracle, among others, also want to keep Novell around as a hedge on Red Hat's dominance. None of them want a "Microsoft of Linux" to push them around.

Even as Goldman Sachs' November 2008 CIO-spending survey showed weakness in demand for Novell products , Novell's fortunes have revived in the past year as its Linux business continues to grow, outpacing the market .

So, no, I can't see either Sun or Novell ending operations in 2009, but I suspect that we will see a few of the lesser open-source start-ups wither in the attempt to raise more funding. Some open-source companies simply aren't any good, just as some proprietary software companies aren't any good. These will go bankrupt, and rightly so.

Tech Culture
About the author

    Matt Asay is chief operating officer at Canonical, the company behind the Ubuntu Linux operating system. Prior to Canonical, Matt was general manager of the Americas division and vice president of business development at Alfresco, an open-source applications company. Matt brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. He is a member of the CNET Blog Network and is not an employee of CNET. You can follow Matt on Twitter @mjasay.


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