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Rattled Red Hat battles support impostors

Death of a thousand cuts?

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Red Hat is rattled. Sure, it remains the world's biggest Linux company by revenue market share. But it's beginning to feel that it's under pressure - and that it must respond.

That pressure is coming not from Microsoft, but from fellow Linux vendors. Individually, they aren't causing too much trouble, but collectively, they could be creating an environment in which customers are starting to question why they should pay Red Hat to support their Linux at all.

Since last November, Novell has tied a Linux migration service to SuSE Linux Enterprise, with support for existing Red Hat Linux systems for up to three years.

Novell's Red Hat customers can save 50 per cent on their subscriptions through its unified management tools and interoperability with Windows. In an email to The Reg, a Novell spokesperson claimed “strong demand” for the service, with customers including Moneygram, Baker Hughes, and VTI Technologies.

Novell has acted three years after Oracle chief executive Larry Ellison launched his company’s support business in an effort to bleed Red Hat dry. With it came Oracle's version of Red Hat, minus the Red-Hat logos, called Oracle Enterprise Linux.

Though they were launched with great fanfare, Oracle's service and its Linux distro haven't upset Red Hat, and last year, Ellison was notably muted in his assessment of both.

Ellison talked like a middle-aged mum, not his usual Alpha male self. He said he was "very, very proud of where we are today" with 4,000 customers. "Uptake of Oracle Enterprise Linux has been better than we anticipated," he claimed.

Despite Oracle, Red Hat has managed to defy gravity and convince customers to keep signing the checks. Its third-quarter results saw revenue increase 18 per cent to $194.3m, while revenue from subscriptions grew 21 per-cent to $164m.

And yet, there are signs the company is rattled.

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