Linux Battles for the System

Microsoft takes aim at Unix and Novell with Windows 2000. But a new rival has arrived: Linux.
Brian O'ConnellApril 1, 1999

There’s nothing glamorous about a server operating system (OS), but no software is more critical to a company’s network and client/ server computer operations. A server OS is the platform on which applications reside, from A/P to ERP. It’s also a traffic cop, enabling multiple PCs to use applications and services simultaneously and efficiently.

According to Bill Gates, there’s nothing more critical to the future of Microsoft Corp. than its own heavy-duty operating system– Windows NT Server. The long-delayed latest version, formerly called NT 5.0 and renamed Windows 2000 in time for the millennium, was preshipped in beta form to 250,000 users last September for testing. Boasting new features and greater scalability, Windows 2000 should continue to take customers from both Unix and Novell.

“The momentum we’re seeing for Windows NT is incredible,” crows Jeff Price, lead product manager for Windows NT Server at Microsoft. “If you look at where we came from in 1993 when we launched NT, our progress has been tremendous. And now we’re well positioned to beat both NetWare and Unix.”

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In 1998, 1.5 million new NT servers (not upgrades) were sold, compared with 1 million NetWare 3.x and 4.x boxes and 758,000 Unix servers, according to International Data Corp. (IDC). Although Microsoft can cite steeper growth rates than its two rivals can, analysts say growth rates can be misleading.

“NT can boast of many shipments and steep growth, but it takes several NT servers to match one multipurpose Unix server,” says Dan Kusnetzky, program director for IDC. “People pay more for Unix servers, which aver-age 50 to 60 users a box, than for NT, which averages about 25 users per box.” According to IDC, Unix garnered $2.8 billion in licensing fees in 1998, compared with NT’s $1.4 billion and NetWare’s $645 million.

Meanwhile, there’s a new contender on the horizon: Linux (pronounced “Lynn-ix”), the OS available for free via the Internet. Regarded as a long-shot until recently, big players like IBM, Compaq, Intel, Oracle, and SAP now support it. (See “Everybody Loves Linux.”.)

50 Flavors

The most powerful operating system is Unix. Developed at Bell Labs in the 1970s, Unix has mutated into more than 50 flavors, with major hardware vendors promoting their own versions– IBM’s AIX, Compaq/Digital’s Digital Unix, Hewlett-Packard’s HP-UX, Sun’s Solaris. Its stability (ability to support applications without crashing) and scalability (ease with which it can be adjusted to support business needs) have made it a standard client/server OS at large corporations with heavy computing demands. But Unix is also expensive and vendor-dependent, and its complexity makes it relatively hard to learn.

Microsoft’s Price asserts that, from a functional standpoint, there’s not much of a difference between NT and Unix. “Database, file, and printer sharing are all pretty much the same,” he says. “Where they differ is in the level of integration among those functional areas.” Price claims that Microsoft has the best file- and print-sharing services, although Novell (which released its new, Internet-friendly version of NetWare last September, NetWare 5) would disagree.

Functionality is one thing; scalability is another. Anthony Bradley, an analyst at Meta Group, points out that a Windows NT server can support only 4 CPUs (processors), while a Solaris Unix system supports 32 CPUs–a huge difference in computing power. Similarly, the Windows NT Datacenter Server can go up to 16 CPUs, “but Unix can go all the way up to 512–into the thousands, if you go massively parallel,” says Kusnetzky. According to an August 1998 survey of information systems managers by Computerworld, Unix outperforms NT by a wide margin (4.27 versus 3.64 out of a possible 5.0 rating).

Still, NT is scalable enough for most companies. Microsoft claims that within two years, NT will be able to handle 600 concurrent users; not many enterprises need more scalability than that.

As for cost, the IS managers in the Computerworld survey said that NT holds the upper hand (3.82 to 3.49). According to Aberdeen Group, NT is currently less expensive to run than Unix. Groups of single- function NT servers can be harnessed to match the performance of a multifunctional Unix machine. The leading Unix server handles 53,000 transactions per minute, at a cost of around $76 per minute; the leading NT server handles 22,500 transactions, at about $19 per minute. That means two NT servers will nearly match the performance of one Unix box, at around half the price.

But Kusnetzky points out that total cost of ownership (TCO) may keep Unix in the driver’s seat. Hardware and software combined constitute only 20 to 25 percent of an operating system’s five-year TCO, he says; the cost of people to maintain the system accounts for 50 to 60 percent. A company may reduce its hardware and software costs by distributing OS services among many Windows NT servers. However, all of those NT servers have to be managed, which means that staffing costs rise.

User Stories

A number of companies are switching to NT to run their networks. One such company is Bertelsmann Music Group (BMG), based in Gütersloh, Germany. BMG cites scalability, cost of licenses, and overall ease of consolidated support as its reasons to switch.

To other users, however, NT stands for “not today.” At the University of Nebraska Press, IS manager Quinn Coldiron deep-sixed his organization’s NT investment, primarily because of reliability concerns. After weeks of system crashes and more than $3,000 in phone support bills from Microsoft, he switched to a Linux operating system that costs virtually nothing to maintain.

“We were running Novell NetWare when I got here in 1996, but we had some difficulties keeping NetWare up and running,” recalls Coldiron. “We switched to NT, which was fairly costly to us, only to see some of the same reliability problems crop up. After a period where we used some NT servers for files and print applications and some Novell servers for our overall file-management needs, the system finally crashed. We switched to the Unix clone– Linux–and haven’t looked back.”

Others say that NT isn’t the bargain that it appears to be. “We’ve been using NetWare since 1988,” says Lee Roth, LAN and security services manager at Dallas-based Southwest Airlines Co. “While we’ve found NetWare to be very stable and highly scalable, that doesn’t mean we don’t look around. But when we looked at NT, which we thought was the only real alternative to NetWare, we found NetWare to be significantly less expensive and just as effective a technology.”

Roth says that while Southwest Airlines is adding some NT servers on the low end, the bulk of the system management tasks remains on NetWare. “There’s a distinction between managing the network and providing system resources,” he explains. “We think NetWare does a great job of managing the network. And we think Microsoft and Unix are better in providing quality applications. So we use a blend of NT and NetWare and call it a best-of-breed approach.”

Reality Is Multitiered

Indeed, using a blend of operating systems is the reality at most larger corporations, and probably will be the reality for years to come, say analysts.

“It’s not a competition,” declares Kusnetzky. “It’s not a question of one [operating system] or the other. Most companies have such a huge investment in so many things–databases, tools, applications, processes and procedures, training, staff–all of that would have to be replaced” if a switch were made from one operating system to another. According to IDC research, most companies that start out to replace Unix with NT eventually abandon the effort.

Many large companies maintain very heterogeneous computing environments, with a mix of mainframes, minicomputers, servers, workstations, and PCs, running on different operating systems. Typically, this breaks down into four computing tiers.

The lowest tier, the desktop OS, is nearly always Windows. The second tier, the workgroup productivity tier, is the domain of NetWare and NT. It provides file and print services, support for shrink- wrapped or off-the-shelf applications, and access to the rest of the network. The third tier, Unix, runs big databases and division- or enterprise-level applications. And the fourth tier, mainframes, handles the biggest database and applications jobs.

“Most [companies] have two or three operating systems already,” acknowledges Price of Microsoft. “Nobody is starting from scratch.” But companies that want to develop a long-term IT architecture should look for complete solutions, he adds. “To have a long-term architecture means asking what do I want in a platform for all my businesses, not just the check-printing department or the finance department,” he says. “To have those things on the same platform using the same security model is where most people want to get to.”

For now, Windows NT has staked out the desktop server market, while Unix remains the technology to beat on the high end. “It’s a phenomenon called the ‘Unix squeeze,’” says Jon Oltsik, senior analyst at Forrester Research. “NT has climbed up the food chain in recent years to command the desktop end of the market, with everything else going to Unix. Right now, we have gridlock.”

Brian O’Connell is a freelance writer based in Framingham, Massachusetts. Additional reporting was provided by David Kucher and Edward Teach.


System Shipments, 1998

  • Windows NT Server:  1.5 mill.
  • Novell NetWare:  1.0 mill.
  • Unix (combined):  758,000

License Revenues, 1998

  • Unix (combined):  $2.8 bill.
  • Windows NT Server:  $1.39 bill.
  • Novell NetWare:  $645 mill.

Source: International Data Corp.


It’s not easy to dominate the operating system market–not even if you’re Microsoft. First Netscape, then Java, then Oracle posed challenges to the NT franchise, all based on the radical premise that the choice of OS should be irrelevant. Now comes Linux (pronounced “Lynn- ix”), which is based on the equally radical premise that an OS should be free.

Linux is a Unix-based operating system developed by Linus Torvalds, a University of Helsinki student, in 1994. It can be downloaded for free from the Internet (; as a result, this freeware has been steadily improved by hundreds of programmers around the world. Thanks to such collaboration, Linux is a reliable, bug-free system, say analysts.

So reliable, in fact, that the biggest vendors are supporting it. Intel is optimizing its Pentium II and III chips for Linux. IBM, Compaq, Hewlett-Packard, Dell, and Silicon Graphics all offer computers that run on Linux. Giant IBM now offers 24/7 support. And SAP, along with its major hardware and software partners, plans to deliver a Linux version of its industry-leading ERP system in the third quarter of 1999. “We have received a significant number of serious customer requests for R/3 on Linux over the past year,” said Hasso Plattner, co-chairman and CEO of SAP, in a press release. “After extensive testing in-house and discussions with our partners and customers, we are confident that Linux meets our standards.”

Meanwhile, software developers like Red Hat Software, MathSoft, and Caldera now provide support for the system; you can buy a Linux CD-ROM from Red Hat for about $40. So far, Linux has about 5 million users worldwide, including companies like Hewlett-Packard, Schlumberger, and Southwestern Bell (and the University of Nebraska Press; see main story).

Many industry observers believe Linux performs just as well as Windows NT. And it’s a lot cheaper– free versus Windows NT’s average price tag of around $4,000 for a 25-user license.

“We’ve had a lot of customers asking for [Linux],” says Rick Bohdanowicz, vice president of the data analysis products division at MathSoft, a Cambridge, Mass.-based software development firm. “We’re seeing a lot of interest from Europe, and much more recently from America. Government and academic users seem particularly attracted to the technology. You know when software developers like Red Hat and us are supporting Linux, the technology is becoming commercially acceptable.”

Linux is also rapidly becoming a favorite at smaller companies with tighter budgets and lower requirements for security, scalability, and fault tolerance. “Lots of corporate users are doing their important corporate research on stand-alone PCs that are not connected to the Internet and are not subject to big security concerns,” explains Bohdanowicz. “That favors Linux over the more-expensive operating systems.”

Maggie Biggs, a senior analyst at Infoworld Test Center, says that Linux has become a popular intranet OS. In addition to being fast, free, and stable. Linux runs on more platforms than Windows NT does, she points out. So what’s the downside? Not all the applications that users may want are supported on the Linux platform, she says.

Not wanting to change an entrenched architecture is the biggest obstacle to Linux’s commercial growth. “Linux will not play in the [network operating system] game,” predicts Jon Oltsik of Forrester Research. “Linux will play the most significant role in new-application development.”–B.O’C.

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