SaaS data loss: The problem you didn’t know you had

Red Hat is on an engineer recruitment spree to boost the support operation for JBoss and drive measured growth for its open source applications business.

The company expects to add at least 100 people per quarter to provide deep support for JBoss along with its Linux distribution.

"We need capability beyond that. We need someone who can look at what's happening in the code itself. These will be fairly senior engineers," Cornett said. "We don't have the people in place to scale the business without causing some risk to the reputation of both companies."

Cornett was speaking after Red Hat upset investors during a recent first-quarter results call by confessing the JBoss deal would take longer than expected to pay off.

One factor pushing back the payback is the fact Red Hat decided not to pursue potential business projected by the loss-making JBoss during the acquisition's due diligence phase.

Had Red Hat's bluff been called in by the combined affects of JBoss' poker face and the threat of an Oracle acquisition waiting in the wings? Not according to Cornett.

"There's only so far they [JBoss] can open the kimono and as a public company, there are considerable limits on our degree to talk to people," Cornett asserted.

Another problem is the fact Red Hat won't be increasing its prices as a step towards recouping the costs of building out support. A recent JBoss poll of customers found 32.1 per cent expect Red Hat to increase services costs "somewhat" compared to 35 per cent who don't anticipate any change. Thirty eight per cent do not expect the quality of services to change, despite paying more.

Cornett denied price hikes are in the pipeline. "I don't see that as the avenue we are going down," he said.

Red Hat is scaling up support amid growing uncertainty over at least one of JBoss' existing support relationships. JBoss has enjoyed first- and second-line support deals with Hewlett-Packard and Novell.

Novell has committed to continue its contractual obligations, but the latest version of SuSE Linux is shipping with the Geronomo open source application server instead of JBoss - now owned by SuSE's biggest rival. That throws a huge question market over whether Novell can be relied on to renew its JBoss support once the current deal expires.®

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