Feeds

Linux distributor Caldera delays IPO

Does Caldera's plan signal a shift in the economics of Linux?

  • alert
  • submit to reddit

Build a business case: developing custom apps

Caldera is to follow fellow Linux distributor Red Hat down the IPO trail later rather than sooner. The company's plan to go public will now not take place until next year and not next month after all, according to sources cited by US newswires. The reason for the decision appears to be advice from Caldera's underwriters, who reckon that hi-tech stocks aren't as popular right now as they have been of late largely as investors are beginning to realise they're more than a little overvalued. The underwriters' advice to Caldera: wait a while. Caldera wants the money it hopes to make through the IPO for expansion. Like Red Hat, it realises the future for Linux distributors lies not in flogging more product per se, but in selling support services to business users. Or does it? It's interesting that Caldera president Ransom Love -- and that doesn't sound like the name of a romantic novelist, nothing does -- sees Caldera competing with major OS vendors, most notably Sun and Microsoft. Competing directly with these players, particularly Microsoft, means getting out there and marketing not only Linux but Caldera as the key Linux supplier. That takes money, and probably more than the company is going to make through its IPO. It's unlikely to do much better than the better-known Red Hat, which is still losing money hand over fist as it battles to build up a revenue-generating service operation. The telling part of Red Hat's most recent results is that the bulk of the company's revenue continues to come from product sales. Clearly people would rather pay Red Hat, Caldera and co. for complete Linux distributions rather than download and compile them themselves, so Linux can perhaps no longer be seen as an entirely free OS. If that's the case, Caldera can perhaps start to push up the price of its Linux distribution to the point where it costs around $99 -- the same as other, more mainstream OSes like Windows and MacOS. Couple that, more margin-friendly pricing and a larger number of Linux users, and perhaps Caldera could look to product for profit -- perhaps instead of the 'traditional' assumption that the only way to make money from Linux is through services... And if Caldera doesn't, Corel, as a retail software supplier and not a service-oriented organisation, almost certainly will. ®

Boost IT visibility and business value

More from The Register

next story
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Amazon takes swipe at PayPal, Square with card reader for mobes
Etailer plans to undercut rivals with low transaction fee offer
Microsoft exits climate denier lobby group
ALEC will have to do without Redmond, it seems
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
US regulators OK sale of IBM's x86 server biz to Lenovo
Now all that remains is for gov't offices to ban the boxes
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.