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Betting Big On Linux

With its package of bread-and-butter accounting software, AccPac is not the kind of ISV one normally describes as cutting-edge. Yet there it was, several years ago now, jumping headlong aboard the Linux bandwagon. At the time, it was highly unfashionable for midmarket ISVs to unhitch from Microsoft's Windows juggernaut, let alone embrace open source. Still, AccPac began crafting a serious Linux strategy. And while it didn't completely sever ties with Microsoft--that would have been suicide from a market-reach perspective--the company ported its C-based applications to Linux.

"Basically, we were uncomfortable making our customers choose what to run our software on," says Craig Downing, vice president of product management at AccPac, which was recently acquired by rival Best Software.

That sentiment is growing in appeal--strong enough to keep the folks at Microsoft checking its rearview mirror for signs of Linux. Propelled by an expanding roster of supportive ISVs and major platform-backers, such as Novell and IBM, Linux is accelerating quickly into the next phase of market acceptance: securing a place as a mainstream business-applications engine. Beyond midtier stalwarts like AccPac, Linux can lay claim to small upstarts like Austin, Texas-based Journyx and giants like business-intelligence specialist Hyperion and PeopleSoft, which is in the midst of porting its entire suite of software to Linux, a nontrivial task to be sure. These are just a few software companies that are exploring Linux on a list that is pretty far-reaching; in February, research firm Evans Data released a report saying that 1.1 million commercial software developers in North America are now spending a portion of their time working on open-source projects, including Linux.

In the sea of players big and small, no one, perhaps, has made a bigger splash of late than Novell, whose Linux gambit is viewed as bold and, to some, last-ditch. By snapping up SuSE Linux for $210 million last year, Novell instantly thrust itself into the commercial Linux arena as one of two major distributors of the OS. This greatly boosts the opportunity for ISVs and hardware OEMs like IBM and Hewlett-Packard because SuSE is generally considered the second distribution of Linux in a universe of two, competing against Red Hat's product line.

"People didn't want to relive the Unix wars, where there were many competing distributions," says Novell CEO Jack Messman. Two major distributions, as opposed to just one or a plethora of choices, suits the market best, he contends.

For Novell itself, the embrace of Linux and other open-source technologies, such as Ximian and the MySQL database, marks a serious attempt at reinvention--one not without risks. It has meant a new management team, a new strategy and a new market, according to Messman. "And it is our one shot to prove that we can do it," he says. "But we have to be more customer-focused and revamp our engineering teams so they aren't producing great products that no one wants."

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