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Mark Shuttleworth is rich enough to cause some havoc in the
feel-good Linux community. In January 2000, at the peak of the dot-com
bubble, Shuttleworth sold his South African security software firm,
Thawte, to VeriSign for $700 million in stock. Shuttleworth
cashed out almost immediately, walking away with the entire purchase
price, just as VeriSign's stock began its rapid descent. “Life has been
kind to me,” he says.
But the 32-year-old has no children and
doesn’t feel much need to hang on to his money. He spent $20 million in
2002 to orbit the Earth for a week in a Russian Soyuz. “I don’t intend
to create a dynasty,” he says.
Instead, Shuttleworth wants to
give back, by offering universal access to a free operating system to
run PCs and servers. The world already has several “free” versions of
the open-source Linux operating system, but Shuttleworth’s version,
called Ubuntu, undercuts them all on price--and works better, according
to many respected sources.
Purveyors of supposedly “free” open-source software, Red Hat (nasdaq: RHAT - news - people ) and Novell (nasdaq: NOVL - news - people ),
make their money charging support fees for every desktop or server
using their software. You can’t get their software at all without
paying something for support.
Support fees for Ubuntu
(translation: “humanity to others” in a South African Bantu language)
are comparable to Red Hat’s and Novell’s, but they’re completely
voluntary. Some of Google's
(nasdaq: GOOG - news - people )
developers use Ubuntu, for instance, but the company doesn't pay
because it services its own machines. Other users might pay only to
support those machines they deem crucial to operations.
“ Deutsche Bank
could deploy 10,000 Ubuntu servers, and they would not have to pay us
anything,” says Shuttleworth in a hypothetical example. “But my guess
is for 1,000 of those servers, they would want a 24-by-7 support
contract.”
Ubuntu now has 4 million users, half of which are
governments, universities and a smattering of businesses. It adds new
ones at a rate of 8% per month. After its public release in October
2004, Ubuntu quickly deposed Red Hat's Fedora as the most popular
version of Linux on DistroWatch, a Web site that caters to Linux users.
Ubuntu works in 22 languages, and Canonical, the company Shuttleworth
set up to distribute his software, will send a free Ubuntu CD anywhere
in the world. New users rave about the simple user interface, which has
gained recent converts in a couple of well-known bloggers who switched
from Apple Computer's
(nasdaq: AAPL - news - people ) OS X.
In May, Sun Microsystems (nasdaq: SUNW - news - people )
announced plans to offer Ubuntu on Sun’s Niagara chips, which power its
newer Sparc servers. While Sparc servers aren’t a particularly big
market, the stunt made clear that Shuttleworth aims beyond home
hobbyists.
Canonical has burned through $15 million of
Shuttleworth's money in two and a half years. He says that it will take
him at least another two years to even know whether it has a chance to
become profitable, and that it may never return his investment. But
that doesn't matter. He's paying all the bills either way, along with
setting up a $10 million endowment for the Ubuntu Foundation that's
earning interest for a day when his attentions may drift elsewhere.
(Shuttleworth tried out in early 2005 for the Donald Trump role on a
South African version of The Apprentice, but lost to a politically connected head of a mining company.)
Competitors Red Hat and Novell say that they’re not worried and that Ubuntu's a welcome competitor. Todd Barr,
director of enterprise marketing at Red Hat, which has more than 80% of
the commercial Linux market, says Ubuntu has done a great job of
“energizing the community” around open-source software.
But if
Ubuntu starts gaining users in the corporate market, Red Hat has a lot
to lose. The Raleigh, N.C., company netted $80 million on $278 million
in revenue in its last fiscal year. A price war could swallow that 28%
profit margin quickly. But though Ubuntu has enjoyed surprisingly fast
growth in emerging economies such as Poland, Lithuania and Brazil, it
so far has found little support among corporations, admits Jane Silber, Canonical's head of operations.
Peter Yared, a former Sun engineer who now runs
ActiveGrid, a company that services software built on Linux, says that
for now his company and most other service vendors support only Red Hat
Enterprise Linux and Novell's Suse Linux. What would it take for him to
support Ubuntu? “Five customers asking for it,” he says.
The big score, of course, would be to steal users away from Microsoft (nasdaq: MSFT - news - people ),
whose Windows Vista has been plagued by delays. “Until now, Linux has
only transformed the proprietary Unix market,” says Shuttleworth. “Guys
like HP, IBM and Sun, who made their own proprietary versions of Unix. That's pretty much been blown away over the last four years.”
For
Shuttleworth, free software is an inevitable progression, whether it
comes from his company or not. So he claims to be unafraid of whatever
Microsoft might throw at him if it feels threatened. “We're a bit like
one head of the hydra, right? If you lop us off, there's a bunch of
others that'll spring up in our place.”
Read the original article: http://www.forbes.com/technology/2006/09/05/linux-ubuntu-opensource_cz_mr_0906shuttleworth.html |
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