[Homestead] IBM's Buyer's Remorse and Linux expiation

Tvoivozhd tvoivozd at infionline.net
Mon Sep 13 18:28:28 EDT 2004

IBM gave away the PC market by brain-damaging its PC Jr to avoid any PC 
Jr. competition with IBM mainframes. And IBM created Microsoft almost by 
accident, choosing the Microsoft OS over (as I remember) Dr. DOS when a 
few days elapsed when someone from Dr DOS took off and no comparison 
made by IBM---Bill Gates won by default at a time IBM accorded no 
importance at all to a PC OS.

Now a resurgent IBM (dead in the water for a decade) is trying to 
compensate for their earlier errors and catch the Linux wave.


*washingtonpost.com* <http://www.washingtonpost.com/>
*IBM's Open-Source Lovefest*

By Cynthia L. Webb
washingtonpost.com Staff Writer
Monday, September 13, 2004; 10:11 AM

"Big Blue" may also earn the nickname "Big *Linux* Supporter" as *IBM* 
continues to embrace open-source efforts to hike its market share and 
challenge competitors, including *Microsoft*.

The company "plans to announce today that it will contribute some of its 
speech-recognition software to two open-source software groups," the New 
York Times reported. "The move is a tactical step ... to accelerate the 
development of speech applications and to outmaneuver rivals, especially 
Microsoft, in a market that is expected to grow rapidly in the next few 
years with increased use in customer-service call centers, cars and 
elsewhere. To do this, IBM is again using the strategy of placing some 
of its proprietary software in open-source projects, making it available 
for other programmers to improve."

More from the Times: "IBM is donating code that it estimates cost the 
company $10 million to develop. One collection of speech software for 
handling basic words for dates, time and locations, like cities and 
states, will go to the *Apache Software Foundation 
<http://www.apache.org/>*. The company is also contributing 
speech-editing tools to a second open-source group, the *Eclipse 
Foundation <http://www.eclipse.org/>*. IBM has contributed code to 
open-source programmers in the past. In August, for example, the company 
contributed *Cloudscape*, a database written in the Java programming 
language, to the Apache Foundation. And IBM is a leading corporate 
sponsor of open-source projects like the Apache Web server and the Linux 
operating system."

Microsoft is trying to thumb its nose at IBM's efforts in the speech 
recognition arena. "This is a case of IBM following Microsoft," said 
*James Mastan*, director of marketing for *Microsoft Speech 
Technologies*. "IBM has not executed in bringing this technology to a 
broad market as Microsoft has."
• *The New York Times: Speech Code From IBM to Become Open Source 
(Registration required)*

In its latest issue, Newsweek chronicles IBM's growing role in 
championing open-source software. Open-source fans "watched with some 
trepidation as a capitalist giant, IBM, began pouring money into Linux, 
capped by a $1 billion investment in 2001. Yet in the past year, the 
corporation known as Big Blue has seen its reputation in the global 
open-source community shift from suspect sugar daddy to knight in 
shining armor," the magazine reported. "IBM is now the giant standing 
between Linux and what the open-source community sees as a Microsoft 
front company bent on destroying their free paradise. The drama is 
playing out in a U.S. federal court, where IBM is fighting a Utah 
company named *SCO* (formerly Santa Cruz Operations). Once a quiet 
member of the Linux community, SCO is a software provider for small to 
medium-size businesses, with $79 million in revenue last year." Recall 
that SCO has caused tempers to flare in the open-source community with 
its demand <http://ir.sco.com/ReleaseDetail.cfm?ReleaseID=126423> that 
Linux users cough up money to use the operating system, which it claims 
to have an intellectual-property tie to. "SCO's case is built on its 
copyright to *UNIX*," Newsweek explained. Requesting money for the 
software "was sacrilege to the free Linux community and a direct threat 
to IBM, which makes money on Linux not by selling software but by 
providing support services and hardware. IBM claimed more than $2 
billion in Linux-related revenue in 2003. Though it would have been 
cheaper to settle, IBM fought back and is now pushing for summary 
judgment. SCO's case looks as if it's close to collapse," the magazine 

"However it ends, the battle is shaping up as a huge marketing coup for 
IBM -- no easy feat in the cynical open-source community. ... That's 
despite the fact that IBM remains an open-source rival on other fronts. 
Supporters of open-source e-mail and database programs fight IBM 
proprietary products tooth and nail. But Linux lovers shrug that off."
• *Newsweek: An Unlikely Champion 

IBM's support of open source efforts has gone international too. EWeek 
reported last week that IBM and *Brazil*'s government "signed a 
cooperation agreement to establish a knowledge and technology center, 
known as *CDTC*, which will promote and develop open-source and Linux 
solutions in Brazil. This is the next step in a plan that IBM announced 
last December. In it, IBM and the Brazilian government agreed to expand 
the use of Linux in Brazil." Brazil has been among the countries that 
are bullish on open-source software as a cheaper alternative to 
Microsoft and other proprietary software systems.
• *EWeek: IBM, Brazil Partner to Promote Open Source 

LinuxInsider from the ECT News Network wrote about the potential for 
Linux to have widespread success (let's not forget that Microsoft powers 
more than 90 percent of the world's computers). "With the recent 
education efforts on Software Freedom Day and aggressive moves by IBM 
and *Novell* it seems that open-source advocates have much to cheer 
about. Although open-source operating systems have not yet become the 
standard in corporate and consumer environments, and face plenty of 
competition, several recent initiatives have shown that it is becoming 
more prevalent worldwide and has the potential to grow even more. Linux, 
in particular, is seeing increased popularity all over the map, from 
Korea to Germany to Brazil," the article said. Here's one Linux 
cheerleader: "'Open source is ready to move beyond the world of geeks,' 
said *Dwayne Bailey*, founder and director of the *Zuza Software 
Foundation*, which is translating *OpenOffice* into several South 
African languages. He added, 'There are so many companies and 
individuals that want to see open source succeed all over the world, and 
it's exciting to be part of that.'"
• *LinuxInsider: Can Open Source Take Over the World? 

Meanwhile, IBM today also "announced a new entry-level, Linux-based 
computer -- called the IBM *eServer OpenPower 720* -- that the company 
says "provides a Linux-based alternative to higher priced [*Hewlett 
Packard*] and *Sun* entry-level UNIX(R) and Linux systems, helping 
clients to attain greater business productivity and lower costs." *Brian 
Connors*, a vice president at IBM, said in a statement: "As Linux 
matures to support mission critical applications, IBM's new family of 
*OpenPower* systems takes Linux to the next level with servers tuned for 
Linux." The Wall Street Journal noted it was IBM's "first Linux-only 
computer as a low-end competitor to cheap Unix computers made by Sun and 
• *The Wall Street Journal: Linux Backers to Support Standard 
(Subscription required)* "

"*Organizing Open Source*

In other open-source news, Linux supporters are trying to get more 
organized to mount a better challenge to the software giant in Redmond, 
Wash. "Major Linux backers have agreed to support a single version of 
the freely exchanged computer-operating software, in a move to 
strengthen its competitiveness against Microsoft," the Wall Street 
Journal reported today, in the same article 
referenced above. "The *Free Standards Group 
<http://www.freestandards.org/>*, a nonprofit trade organization based 
in San Francisco, is expected to announce today that providers of Linux 
versions from around the world agreed to back Linux *Standard Base 2.0*. 
Those who have also agreed include International Business Machines 
Corp., Hewlett-Packard Co., *Dell Inc.*, *Intel Corp.* and other 
companies that sell Linux-based computers, software and services." "

"The article explains more about the fragmentation that is already 
occurring with the open-source software. "One benefit of Linux has been 
that it is an open standard, accessible to everyone. But for-profit 
companies such as *Red Hat Inc.* of Raleigh, N.C., and Novell Inc. of 
Waltham, Mass., frequently add features to Linux to make their products 
and services more appealing to customers. Even some Linux advocates have 
worried about the danger of Linux 'forking' into several different 
variants, just as Unix, an older universal operating system divided into 
proprietary products sold separately by IBM, Sun Microsystems Corp., and 
others. Microsoft has been highlighting the specter of Linux 
fragmentation recently as it works to stifle the spread of the rival in 
the marketplace. It has run advertisements in Europe showing Linux 
penguins with various appendages such as elephant trunks and frog feet, 
as a warning to customers that its rival is likely to fragment into 
incompatible variants," the article said. "The desire to counter 
Microsoft's Windows is creating a broad alliance. Today's announcement 
also is expected to say that Linux competitors such as Red Hat and the 
*SuSE* unit of Novell, have agreed to support the new Linux standard, 
along with makers of other Linux versions known as distributions." "

" "

"Check out a column 
<http://www.washingtonpost.com/wp-dyn/articles/A36325-2004Aug3.html> I 
wrote in August on various Linux developments. "

" "

"*Beefing Up Longhorn*

Microsoft is taking potshots about the security of its products 
seriously and is planning more security features to bolster its next 
version of its Windows operating system, dubbed Longhorn. "For years, 
programmers at Microsoft Corp. and elsewhere have worked to make it 
easier for devices like cell phones and personal digital assistants to 
work instantly and easily with computers. Now, Microsoft is working to 
make it a little harder. The reason: As such devices including *Apple 
Computer Inc.*'s popular *iPods* become capable of holding more data, 
some worry people could use them to steal data or unleash virus attacks 
on business networks," the Associated Press explained, noting that 
"Microsoft is working on technology that will give companies more 
control over whether to prohibit devices that can easily be used to 
transfer data to and from personal computers, said *Greg Sullivan*, a 
lead product manager." "

" "

"CNET's News.com reported on the development last week. "Much has been 
made of the security risks posed by portable storage devices known as 
USB keys, or flash drives, music players like the iPod, and other small 
gadgets that can store vast amounts of data. Some fear that such tiny 
devices can be used to quickly copy sensitive data off business PC hard 
drives, or to introduce malicious software onto corporate networks," 
CNET said.
• *The Associated Press via the San Jose Mercury News: Next Version of 
Windows Will Include More Anti-Data Theft Protections 
(Registration required)*
• *CNET's News.com: Longhorn to Put Squeeze on Gadgets 

"*La La Land*

There's trouble in the ring tone world. Snazzy ring tones for cell 
phones were supposed to be a goldmine for the music industry. But it 
hasn't been an easy sell. The Wall Street Journal wrote about ring tone 
woes in a front page article today. An excerpt: "The ring tone market, 
once seen as the industry's next cash cow, has become a dizzying 
free-for-all, stymied by nightmarish contractual disputes, conflicting 
technical requirements and the old specter of piracy. Losing out could 
be a big blow to an industry that most recently missed the opportunity 
to control the sale of music online," the article said. "Musicians have 
contracts with companies that own the underlying music and lyrics and 
also with companies who own the rights to a recorded performance. 
Sometimes many musicians are credited with writing one song. Getting all 
these players to agree on ring tone rights can be a huge morass. 
Meanwhile, not all cellphones play all ring tones. No one can even agree 
on what to call the latest variants that play actual snippets of songs, 
as opposed to tinny beeps. They've been dubbed master-tape ring tones, 
ring tunes, true tones, hi-fi ringers and song tones."
• *The Wall Street Journal: Music Industry Struggles to Get Cell Phone's 
(Subscription required)* "

" "

"Reuters had a report of its own on the trend, noting that "the U.S. 
appetite for ring tones has not developed as quickly as in other 
markets, and no company has emerged to do for ring tones what Apple 
Computer has done for digital downloads with iTunes. A big part of the 
responsibility for building the market falls to the five major mobile 
phone carriers: *Verizon*, *Sprint*, *Cingular/AT&T Wireless*, 
*T-Mobile* and *Nextel*. However, it is generally held that mobile music 
promotions are more effective when some combination of the carriers, 
handset manufacturers, ring tone aggregators and record labels co-market 
their products."
• *CNET's News.com: Ring Tones Slow to Rock U.S. Market 

"*Getting Fat on Defense*

The defense industry continues its acquisition binge. London firm *BAE 
Systems*, which Bloomberg noted is Europe's largest defense player, is 
scooping up 
*DigitalNet Holdings*, a technology defense contractor based in Herndon, 
Va., for roughly $600 million. The move by the Rockville, Md.-based unit 
BAE Systems North America is intended "to expand sales in the United 
States. The transaction is expected to close in the fourth quarter, 
pending government approvals, [BAE] said. DigitalNet sells network 
security software to U.S. defense and intelligence agencies," Bloomberg 
said. "

" "

"The Washington Post pegged the deal at "$595 million in cash." More 
from the article: "The deal, which must be approved by shareholders, 
continues a consolidation of the market and would create [a] $1.2 
billion information technology division ranked among the federal 
government's top 10 information technology providers. The acquisition 
would also result in a significant payoff for the DigitalNet investors 
who founded the company in 2001 and took it public last year."
• *Bloomberg via the Los Angeles Times: BAE to Buy DigitalNet Holdings 
(Registration required)*
• *The Washington Post: BAE Systems to Buy DigitalNet 
(Registration required)* "


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