Linuxers Look East

IBM Corp. (NYSE: IBM) and Red Hat Inc. (Nasdaq: RHAT) are looking eastward to emerging markets in an attempt to spread the open-source gospel and lure users onto their platforms.

The two vendors today announced an initiative to woo developers in countries such as China, India, and Russia over to Linux, based on IBMs 15 testing centers dotted around the globe. The firms have teamed up to let software vendors port and certify applications at these “innovation centers,” using a mix of IBM hardware and software as well as the Enterprise Linux product from Red Hat (see IBM, Linux Team Up ).

IBM is pushing centers in places like Beijing, Bangalore, and Moscow in a bid to plant its technology flag in growing markets. This is the second time in recent weeks that the vendor has looked abroad. Last month IBM targeted startup companies in China, India, Russia, and Brazil with another open standards initiative (see IBM Launches Initiative and IBM Forms Council).

Emerging markets, particularly in Asia, represent a major potential cash cow for U.S. software vendors. Linux, which is touted as a low-cost and secure alternative to proprietary software from the likes of Microsoft Corp. (Nasdaq: MSFT), is catching on in many locations east of Europe. Last year, for example, Computer Associates International Inc. (CA) (NYSE: CA) used Linux to clinch a major deal with the Chinese government (see China Certifies CA).

IBM and Red Hat are wooing the same kinds of users in the new markets as they have in the U.S. -- namely, those dissatisfied with the level of open-source support they receive from ISVs (see Wall Street Calls for Linux Support).It is not just traditional technology vendors that are clamoring for a share of this market. Telecom giant AT&T Corp. (NYSE: T), for example, plans to open an Internet-connected hosted data center in Shanghai later this year in an attempt to tap into China’s IT boom (see AT&T to Host Shanghai).

While India has so far grabbed a lot of the headlines as an emerging IT environment, analyst firm Frost & Sullivan says China is catching up fast, thanks to various IT-friendly government initiatives (see Global Outsourcing Gains Momentum). It is hardly surprising, then, to discover that three of the IBM innovation centers are in China. Tellingly, this is the same number of centers as are located in the U.S.

Meanwhile, the Indian technology industry is also taking off. The fact that more and more Indian firms are providing help-desk and server support for companies elsewhere in the world should also help drive Linux deployment on the subcontinent (see Report: Users Shun Mega-Deals).

— James Rogers, Site Editor, Next-Gen Data Center Forum