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August 22, 2006
Red Hat Enterprise Linux 5 had been scheduled to ship by the end of 2006. However, the company began giving itself scheduling wiggle room in September, when Red Hat released the first RHEL 5 beta. A second beta arrived in November.
Now Red Hat is being more definitive. "I'm sure we will ship a gold (version) on February 28," Chief Executive Matthew Szulik, referring to the final version, said in an interview after the company reported its quarterly financial results.
The delay isn't a major problem for Red Hat, said Pund-IT analyst Charles King.
"Making certain that RHEL 5 is thoroughly locked, loaded and debugged before sending it out the door (is) more important in the end than meeting a deadline," he said. And because Red Hat sells software subscriptions, all existing customers get free upgrades, so the company doesn't consider the new version a "revenue event," he added.
One major feature arriving in RHEL 5 is Xen, virtualization software that lets a single computer run multiple operating systems simultaneously. The technology's initial advantage is to let administrators load up a server more efficiently, but virtualization in the longer run also holds promise for reliability and flexibility because virtual machines can be moved from one computer to another while running.
Virtualization has been a feature on higher-end servers for years and has arrived on mainstream x86 machines chiefly through software from EMC's VMware subsidiary. Xen lacks VMware's market power, but the open-source software is being incorporated as a standard feature of corporate versions of Linux and the x86 version of Sun Microsystems' Solaris.
Microsoft is working on another virtualization competitor, code-named Viridian. It's due to ship within 180 days of "Longhorn Server," the server cousin to Windows Vista.
Reworking an operating system's foundation, as "hypervisors" such as Xen require, is necessarily complicated, however, and Red Hat Chief Technology Officer Brian Stevens said maturing and incorporating Xen is the major factor on which RHEL 5 depends.
RHEL 5 is based on version 2.6.18 of the Linux kernel--the core of the operating system--compared to 2.6.9 for the current RHEL 4. The software includes new security features to protect against some attacks, plus a "technology preview" of Red Hat's Stateless Linux software to let desktop machines pull data and settings from central servers.
Red Hat's chief competitor, Novell, began shipping Xen in its Suse Linux Enterprise Server months ago, but so far, the company hasn't threatened Red Hat's commercial Linux dominance. A newer threat--Oracle, which announced in October that it will release a free RHEL clone and sell its own support for the software--so far hasn't been a problem.
"Clearly, the doomsday scenario that some investors feared regarding the entrance of Oracle into the enterprise Linux arena and the ramifications of the Novell-Microsoft partnership did not materialize in the quarter," W.R. Hambrecht analyst Robert Stimson said in a note last week.
Red Hat's billings increased 50 percent, compared with the year-earlier quarter, to $133 million, well above analysts' average expectations of $120 million to $125 million, Stimson said.
One challenge Red Hat faces is integration of JBoss, open-source software from a company of the same name that Red Hat acquired in June. Red Hat reiterated earlier guidance that JBoss would produce $22 million to $27 million in revenue by the end of February, prompting Merrill Lynch analyst Kash Rangan to say in a note that JBoss is "tracking well."
Among Red Hat sales worth at least $1 million in the quarter, two-thirds involved JBoss software, Szulik said. "When we acquired (JBoss, it) was an unprofitable venture. It is still unprofitable, but it's improving," he said. Red Hat expanded JBoss sales into Asia, Latin America and the Middle East, and the acquisition presents an opportunity to boost revenue from subscription renewals, he said.
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I still use RHEL 3 servers precisely because there's no pressing need to upgrade, and because RHEL still gets the same revenue from our subscriptions, they have no huge and burning desire to make me upgrade to RHEL 5 (it also means that they do a damned fine job of backporting patches and critical feature improvements into their previous versions). This means that I don't have to waste tons of money in upgrading software or hardware just because a new version comes out.
Now compare/contrast this with Microsoft, who will be [i]very[/i] busy trying to force their customers to upgrade to whatever server version comes out next, whether said customer wants to or not. This is because MSFT [i]needs[/i] to sell new licenses just to keep cash flow coming in.
I almost feel sorry for the Windows-heavy (or Windows-only) IT shops... every time MSFT spews out a new server version, incompatibilities and "product lifecycles" will require them to blow a huge wad of cash just to run the new OS version (not to mention the ever-increasing hardware requirements... if Vista is a resource hog, I can only imagine what the server version is going to be like...)
/P
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