Version number notwithstanding, Red Hat Enterprise Linux 3.0 is the company's second edition of Linux specially designed for corporate users that prize stability. The company says that the new version of the operating system runs Java software and databases more quickly, can run on mainframes and several other new machines, takes advantage of powerful 32-processor hardware and comes with better programming tools.
"It's made them profitable. It's a dramatic change," said CE Unterberg, Towbin analyst Katherine Egbert. Although Red Hat's drawn-out subscription payment plan precludes a sudden increase in revenue, Egbert expects the company will garner more sales through partners such as IBM, Dell and Hewlett-Packard.
Improving RHEL is crucial for Red Hat in dealing with its two main competitors. It must continue its march against Sun Microsystems and others who sell Unix, the operating system on which Linux is modelled. And it must grapple with Microsoft, which has advantages including overwhelming dominance on desktop computers and the largest presence in the market for higher-end networked server computers.
In addition, Red Hat must stave off rival SuSE Linux. SuSE beat Red Hat to the mainframe market by years, has just about caught up to Red Hat in partnerships with hardware and software companies, and is strong in Linux-friendly Europe, where governments in particular have shown a willingness to forgo Microsoft products.
SuSE and Red Hat both are growing, but Red Hat comes out ahead so far, said IDC analyst Dan Kusnetzky. "In the overall market for Linux server software, by revenues and unit shipments, Red Hat is still the dominant supplier," with more than 50 percent market share in 2002, he said.
While the new version of RHEL brings some improvements, it also leaves farther behind some Red Hat fans accustomed to the company's earlier philosophy of making its software available for free and charging only for optional technical support.
Before 2002, Red Hat sold its Linux product with support but also made it available as a free download for those who didn't want support. When the company began its aggressive RHEL plan in 2002, it stopped making a free version available for download, started requiring customers to pay for each copy they used, and charged higher prices. In exchange, Red Hat promised a version that met industry partners' needs and that would change less frequently so that hardware makers, software companies and customers wouldn't have to spend all their time keeping up with fast-moving Linux.
"They are a business, and that does put them in a position of tension with some members of the community that expect (otherwise) free software to be available at low cost," Kusnetzky said.
Pricing largely hasn't changed from the earlier version, which ranges from $179 (£166) per year for a RHEL WS on a workstation and basic support to $2,988 per year for a RHEL AS for a higher-end server and round-the-clock support. Customers who purchased a subscription to RHEL 2.1 may upgrade for free. In addition, Red Hat will offer special pricing for organisations hooking numerous Linux computers together to form a supercomputing cluster.
But Red Hat has moved to a new layered pricing model for two extra packages -- development tools based on the Eclipse project and "clustering" software that shares work among a group of computers. The clustering will cost an extra $499 per server per year, while the developer tools are free for a time while Red Hat tries to establish a new user base.
Most of the top server sellers will install RHEL on their systems, including HP, IBM, Dell, Fujitsu, Hitachi and NEC, Red Hat said. Sun, which added Red Hat and SuSE Linux support only this year, will begin installing Red Hat Linux by the end of the year, a representative said.
Under the hood
One of the most significant changes to the software came with an overhaul of a hidden part of the operating system, concerning a new mechanism for handling independent computing tasks called "threads."
"The scalability of the threading has gone from being able to support 1,200 to 32,000 threads. The impact on Java is just amazing," said Brian Stevens, vice president of operating-system development at Red Hat. "That was probably the most significant engineering effort and the most profound impact on customers."
Outsiders agreed that the new threading system, called the Native Posix Threading Library, will help. "NPTL is definitely a boost for the Java crowd," said McDonald Investments analyst Brent Williams.
Kusnetzky said good threading not only boosts Java and database software but also tends to improve how well an operating system can take advantage of all the hardware of a multiprocessor server.
Improved Java performance could make Linux run better on a class of lower-end and midrange servers where it hasn't fared well thus far: application servers that run Java programs.
Unix products long have been able to gracefully handle many threads, but Linux lagged behind until two Red Hat programmers -- Ulrich Drepper and Ingo Molnar -- came up with new threading software. Their work was spurred in part by IBM, which began its own Linux threading project but dropped it after Linux leader Linus Torvalds expressed his preference for the Red Hat approach.
"IBM got everybody's attention that it was a problem. Even more important, they recognised when there was a better solution, so instead of competing they joined," Stevens said.
The NTPL threading software has been accepted into the next version, 2.6, of the Linux kernel, which is the core software at the foundation of larger products such as Red Hat's. The company created a version of the threading software for the current 2.4 kernel on which RHEL 3.0 is based.
SuSE thinks Red Hat's threading decision isn't the best approach because the changes required to the 2.4 kernel are too extensive. "NPTL... originally was envisioned for 2.6. We thought it smart to keep it there," said Markus Rex, SuSE's head of development, in an interview.
Supporting more servers
When Red Hat first split off a version of its software for conservative corporate users in 2002, it started small, with a version only for "x86" computers using chips such as Intel's Xeon or Advanced Micro Devices' Athlon. The new RHEL 3.0 covers much more terrain.
New server types Red Hat supports include IBM zSeries mainframes, iSeries midrange servers, pSeries Unix servers, and computers using Intel's Itanium processor and AMD's Opteron processor.
"We had piecemeal support for Itanium and mainframes, but we're able to consolidate that onto a single system build," Stevens said. "For customers looking at the mainframe, they didn't have a first-class solution from Red Hat. Now they do."
"It seems to me (Red Hat) is discovering the mother lode of server hardware and processor targets it needs to," Unterberg said of Red Hat's expansion.
Running on multiple hardware systems has been a Linux forte for years. However, even when the source code underlying software such as Linux is freely available, it's not a simple matter to create multiple versions.
For example, threading works differently on different chips, Stevens said. "Threading was the challenge early on. We absolutely had to overhaul our inside architecture to deal with the multiple architectures," he said.
Backlash?
Red Hat's focus on corporate buyers may have boosted the company's financial fortunes, but it is alienating some customers -- in particular those from schools with tight budgets.
At the same time as Red Hat created the Enterprise Linux line, which changes slowly so hardware and software companies have time to adjust to changes and certify their products, it has given freer reign to its other version, now called Fedora, which is available without charge. Because Red Hat doesn't have to worry about Fedora certification, support or retail sales, the company can rapidly move new technology into it so new features will mature faster.
The only hitch is that some customers had grown accustomed to a free version that was better adapted for serious use rather than just experimentation.
Fedora is "a rapidly moving, constantly changing hobby (distribution) that is possibly full of breakage," wrote one writer on a Red Hat mailing list. "Those of us that have built our businesses and practices around Red Hat Linux are now left at a choice between forking over large amounts of money that we can't really afford for RHEL, or changing our businesses to go with a different vendor of Linux... or trying to make Fedora a viable solution."
Another poster to the list, who helps run Trinity University Linux servers, wrote, "We at Trinity run 100 or so machines for student and faculty use, and the Fedora Core just won't do it for us." The posting said that the university lacks the staff to support a fast-changing product or the money to pay for RHEL.
Though Red Hat won't certify Fedora or guarantee "binary compatibility" -- that software written for one version will run on the next -- Fedora is useful software, Stevens argued. "The proof will be in the pudding. Red Hat now has more engineers focused on Fedora than we did on Red Hat Linux," the last free version, Stevens said. And while some object, others are delighted that Fedora will move faster because it will be untethered from many support requirements.
Some users also could be mollified by a forthcoming lower-priced retail product called Red Hat Professional Workstation that's based on the workstation version of RHEL.
Red Hat may have alienated some, but it has created new possibilities for others. Case in point: Dax Kelson of Guru Labs, who has been using Red Hat's Linux since version 2 appeared in the mid-1990s.
His company trains Linux users, and it's a booming business with growing demand from customers such as America Online. "The Linux training has been going really crazy. We've tripled in size in the last 12 months" to 12 employees, he said.
And Kelson believes the Linux trend continues to head in the right direction. "Linux has been chasing the proprietary Unix guys up the tree. They keep retreating," he said.
