Keane Insight

A fight in the open

Matthew Szulik, Red Hat chairman, president and CEO was in India recently—his very first visit to the country that has the potential to lead the open source revolution in the coming years. Venkatesh Hariharan spoke to Szulik about his meeting with India’s First Citizen, Red Hat and the future of Linux

Matthew Szulik

At a swank South Mumbai restaurant, he considers asking the live band to play ‘Indiana Jones and the Temple of Doom’ but thinks better of it. Matthew Szulik, chairman, president and CEO of leading open source software company, Red Hat, has other pressing matters on his mind.

Red Hat, a company built around the idea of combining open source software with a great brand, has come a long way since its inception. The company’s growth has kept pace with the growth of the open source movement that’s rapidly evolving alternatives for all kinds of proprietary software, ranging from operating systems, databases, word processors, Web servers and application software.

When the open source model of volunteers collaborating over the Internet to develop software started, few people gave it a chance of succeeding in a world that’s dominated by proprietary software companies. Linux, a leading open source software, started life in 1991 when Linux Torvalds decided to put the 10,000 lines of code he had written to create an operating system for his 386 PC on the Internet. Over the last 12 years, Linux has grown to more than 10 million lines of code due to the efforts of thousands of volunteers who downloaded the software and added their own software code to the product. Today, Linux poses a challenge to Microsoft’s stranglehold on the operating system market. In this, the open source movement has succeeded in a market where even a giant like IBM failed with OS/2 that was designed to take Microsoft’s Windows 95 head-on.

“First they ignore you. Then they laugh at you. And I personally believe that we are now in the fighting stage.” That’s Szulik’s own take on where Linux is placed in the battle for market share in the operating systems arena during his recent visit to India. Appropriately, he was quoting Mahatma Gandhi who said, “First they ignore you. Then they laugh at you. Then they fight you. Then you win.”
Szulik had several reasons to be upbeat: A recently concluded $600 million funding round; a meeting with India’s technocrat-president, A P J Abdul Kalam, where Kalam endorsed open source software’s relevance to India, and several columnists declaring Linux as one of the top trends for 2004.

“This company that people said would only be around for 15 minutes is now a profitable technology company distributing its software in 51 countries and has over $1 billion in the bank,” he said.

Meeting the First Citizen

Szulik was on his first visit to India and one of the highlights of the visit was a meeting with President A P J Abdul Kalam, the father of India’s missile programme and a keen technocrat. Kalam has been vocal with his support for open source software and believes that it is a cost effective alternative for India. During the meeting with Szulik, Kalam explained the Vision 2020 blueprint for making India a developed country by the year 2020. He displayed a keen understanding of the role that open source software can play in transforming this blueprint into reality.
During his visit, Szulik lost no opportunity to play up the advantages of open source software in the Indian context.

“India has an amazing opportunity to harness low-cost Intel hardware and open source software to bring down the cost of computing. It’s the thirst for an alternative, standards-based computing infrastructure at the lowest possible cost that fuelled the growth of open source, said Szulik.

He said that one of the most important things he realised from his India visit was the economic challenge of building a relationship based on affordability. “India needs a different treatment compared to the US market and we feel that there is an urgent need to scale our service component on an India-wide basis.”
Szulik found that the Indian marketplace is heavily government-oriented with a smaller percentage being the commercial, private sector.

“In India, our challenges are to make Linux available at the lowest possible cost and making it easy for regional software vendors to port their applications to Linux.”

Truly in the black

Red Hat is one of the most successful Linux companies in the world and Szulik said that there were several reasons for the company succeeding where others failed.

“In 1997, Red Hat made the decision that software was becoming a service and as a result we did not license software in the traditional way. That turned out to be a very good decision.”

The second aspect, according to Szulik, was the company’s ability to stay true to the open source philosophy. “Many companies went public during the boom—VA Linux, for example. These companies did not have the courage to stay true to their beliefs and made decisions that were corrosive to their future,” he said.
The third factor that contributed to Red Hat’s success was the building of an integrated service and support organisation that has allowed it to build relationships with software companies and hardware
manufacturers.

For all his hard sell of open source software, Szulik does not believe that proprietary software companies will disappear anytime soon.

“I think for the foreseeable future, proprietary software companies will have recurring revenues based on ‘maintenance.’ But if you look out 10-15 years from now, the most important thing will be adding value to a well-organised information model.” Szulik pointed to companies like Amazon and eBay that did not have legacy systems and chose to build their IT infrastructure with open source components. He said that their modern information model is not built around proprietary products, but around open standards.
He added that Linux would not fragment the way the Unix world did because Linux vendors competed on the basis of value provided and not by locking in their customers.

Broken glass on the road

Commenting on the recent lawsuit by SCO, Szulik accused the company of “throwing broken glass on the highway of progress.” SCO had alleged that the Linux software’s code contains intellectual property copied from Unix, to which SCO has the rights. He said that after almost seven months, SCO had not come up with any facts that could substantiate its allegation.

SCO sent out a threatening letter to around 1,500 of the world’s largest companies, warning that their usage of Linux could expose them to legal action. To counter this, Red Hat has launched the Open Source Assurance programme that ensures that in case an infringement is identified in Red Hat Linux, the company will replace the existing code.

On the growing threat to open source software from software patents, Szulik said that the only option was to include legal experts in the process of developing open source software. “There are many smart minds in academia; James Boyle at Duke University, Lawrence Lessig [Professor of Law at Stanford Law School], etc, and we need to involve them in the process of developing open source software.” He said that the issue of intellectual property in the digital age is an issue that is important for our future. “The threat from software patents is such that our children and our children’s children will suffer.”

Szulik said that open source software was not just an issue of competition but also an issue of being able to challenge financial, economic and technological structures. “Open source is an unconventional idea that totally challenges the historic assumptions and once again, the consumer benefits.”

With several columnists and technology pundits declaring 2004 as the year of Linux, open source software is no longer a laughing matter. Now, the ‘fight’ for the hearts and minds of computer users is about to get more intense and there is one company that’s not shying away from throwing its hat into the ring.

Venkatesh Hariharan is a technology journalist based in Mumbai. He is also the co-founder of IndLinux.org, a non-profit that’s localising Linux to Indian languages. He can be contacted at venky1@vsnl.com