Ubuntu 8.10 due Thursday. Profits? Not so fast

Canonical will release Intrepid Ibex this week, improving wireless networking and sporting BBC content. Profitability, though, could be three to five years away.

Stephen Shankland
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Canonical will release the newest version of its Ubuntu version of Linux on Thursday, Chief Executive Mark Shuttleworth said Monday, but the company's profitability isn't on such a fast track.

Ubuntu 8.10, aka Intrepid Ibex in the company's alphabetically ascending naming convention, is the latest installment of Linux for desktop computers and servers in the company's six-month release cycle. Among the new features are support for 3G wireless modems, the ability to set up an encrypted and password-protected private directory, a guest account that can help out someone needing temporary use of a computer, and built-in content from the BBC. On the server, 8.10 includes better support for Xen virtualization, the Landscape console for managing and deploying Ubuntu, software for building customized virtual machines, and support for software-based RAID to protect data on storage systems.

Ubuntu, unlike its main rivals, is available for free in both enthusiast and supported editions. It's made some inroads in recent years against Red Hat and Novell's Suse Linux, but it hasn't proven to be as strong a business prospect for the company behind it. Shuttleworth, who got rich by selling his last start-up to Verisign, indicated just how patient he is with his new investment, though.

Selecting plug-ins in Ubuntu 8.10
Selecting plug-ins in Ubuntu 8.10. (Click image to enlarge.) Canonical

"I have no objection to funding the business for another three to five years," he said in a conference call Monday. "I certainly have the patience to see us through any downturn. I think this downturn is going to be very good for Canonical...Canonical is not cash-flow positive, but our offering is very effective for those who want to pinch their pennies."

For Shuttleworth, profitability is a matter of when, not if--he wants to invest in areas the company deems important rather than curtail development to move to profitability faster.

"If we needed to, we probably could be profitable in two years," by focusing on the core operations such as the server version, he said.

Shuttleworth added that the company has an annual revenue run rate of millions of dollars.

The company bases its business chiefly on selling support, either to customers for its Linux software or to companies that need expertise in building Linux-based systems. Selling Linux for desktop computers on its own, though, is no way to financial glory, Shuttleworth said.

"I don't think it will possible to make a lot of money, or maybe any money, selling the desktop," Shuttleworth said. "We're not going to try to make money selling the desktop. We force ourselves to look to services-oriented business models. I remain confident this is the right business model for the industry. Linux is the forcing function that (means) the broader software industry will shift in business models away from licensing the bits and to services."

The most recently released version of Ubuntu, version 8.04 or Hardy Heron, was the last to have long-term support, which runs for five years on the server and three years on the desktop. Intrepid Ibex is an ordinary release, with 18 months' support.