The online brokerage is moving its computer systems over to IBM servers that run the operating system. In a statement, E*Trade cited cost savings and performance as reasons for switching to Linux.
E*Trade's and IBM's representatives did not immediately return calls seeking comment.
At the LinuxWorld conference in New York on Monday, IBMout several new customers of its Linux systems, including clothing retailer L.L. Bean and financial services giant Salomon Smith Barney. The customers, several of which are running Linux on IBM mainframes, touted the operating system for its performance.
IBM made a $1 billionin Linux last year, developing and promoting the operating system. The company said it has nearly all of the investment.
E*Trade is replacing a number of its middleware servers based on Sun Solaris with IBM xSeries Intel servers running Linux, said Bill Zeitler, senior vice president and group executive of IBM's server group in a speech at LinuxWorld. Zeitler said the new system would triple the number of customers E*Trade's systems can handle at any one time.
E*Trade did not say in its statement how many servers it is replacing. The company also did not say how much it is investing in the new system.
News.com's Stephen Shankland contributed to this report.