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Commentary: After SCO deal, Caldera needs a Linux-Unix vision

Caldera Systems' plan to purchase the server and services units of struggling Unix vendor Santa Cruz Operation puts a new spin on the evolution of Linux.

By George Weiss, Gartner Analyst

Caldera Systems' plan to purchase the server and services units of struggling Unix vendor Santa Cruz Operation (SCO) puts a new spin on the evolution of Linux. To succeed, however, Caldera must articulate a coherent road map for OpenLinux and SCO OpenServer.

After the initial excitement over

See news story:
SCO lays off 190 workers with Caldera deal
newly public Linux companies, Caldera's stock price declined, seriously trailed Red Hat, showed no immediate prospects of profitability, and became part of the souring investment attitude toward Linux companies over the past few months.

Caldera has striven to offer Linux products and services, aimed at integrators and small and midsize enterprises, and to develop a reseller channel.

One of the earliest Unix suppliers, SCO developed a network of thousands of resellers as well as a strong original equipment manufacturer (OEM) base for SCO OpenServer. Caldera would have needed years and tens of millions of dollars to develop such a channel. But SCO's revenue dropped and profits turned into red ink.

As Gartner has predicted, Linux will become more closely tied to Unix as common features and functions are exploited. To keep SCO customers from drifting to Windows 2000, Caldera must deliver a coherent road map for SCO's OpenServer and Caldera's OpenLinux and must clarify the data center UnixWare strategy for Intel's IA-64 processors (from SCO's work on Project Monterey).

Caldera will own the SCO operating system code. But, through various licensing arrangements, it will selectively provide source-code access and value-priced software while restricting the free distribution rights called for in the General Public License.

This acquisition marries two financially unstable companies that are urgently seeking a viable combination of new and old technologies in an effort to create a successful new business model. Caldera and SCO offer complementary technologies, and Caldera inherits a technology division, along with an established channel and professional services organization.

In reality, those elements need a solid vision to satisfy the diverse needs of a community of resellers, OEMs, independent software companies and businesses unaccustomed to the changing paradigm of open source. Caldera cannot afford to mask the diverse needs of that community with a "Linux wrapper" and expect that businesses will welcome the Internet-based solutions of Linux.

Caldera must articulate specific migration and upgrade options, or customer growth will likely stay stagnant, and much of the installed base will move to Windows 2000.

Nevertheless, of all Linux distributors, Caldera is the one that is most willing to raise Linux to the next level: from versions that businesses must customize entirely themselves to ready-to-run but customizable solutions. (For related commentary on SCO Unix resources and support information, see TechRepublic.com--free registration required.)

Entire contents, Copyright © 2000 Gartner Group, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.