Lineo is working on an embedded version of Linux called Embedix, based on OpenLinux, a version of the software sold by Lineo's independent sister company, Caldera Systems, the company said.
Linux has gained popularity as an "open source" operating system for servers forming the fabric of the Internet. As previously reported, Lineo hopes to bring Linux to devices that allow users access to only the simplest of computing operations.
The effort is conceptually similar to Cygnus Solutions' eCos, an open-source software product the company gives away for free. In open-source programming, underlying programming instructions may be freely shared, modified, and redistributed, but often companies with expertise in the area try to make money selling services to provide technical support.
Lineo's formal work in Linux for devices also is a more direct threat to Microsoft, which has been trying to sell its Windows CE operating system for similar types of devices.
Lineo also is working on a Web browser for Embedix called Embrowser, formerly called WebSpyder and developed for DOS, Lineo said. In addition, the company sells a software development system called Hurricane, which is aimed at using Linux in devices.
In an earlier interview, Lineo chief executive Bryan Sparks that Linux will join, but not supplant, DR DOS as the operating system used in the company's hardware products. "We sell a ton of DOS every month. The Caldera Thin Clients business is profitable on DOS revenues alone," Sparks said.
"We have our little niche, and people know about us. I just don't see it ending for at least another three years or so."
Lineo has sold Embedix-based systems to several electronics manufacturers, but declined to say which. However, Sony has been in discussions for using Linux in consumer electronics products, according to Benoy Tanang of Caldera Systems.
Ray Noorda, former chief executive of Novell, is an initial investor in Caldera.