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January 21, 2009 8:07 AM PST

Red Hat set to surpass Sun in market capitalization

by Matt Asay
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In what may come to be seen as a deeply symbolic moment in the history of operating systems, Red Hat is on the verge of surpassing Sun Microsystems' market capitalization for the first time.

Sun, perhaps unfairly, represents a fading Unix market. Red Hat, for its part, represents the rising Linux market.

As I write this, Red Hat's market capitalization sits at $2.62 billion, while Sun is just ahead, at $2.7 billion. The stock prices are way out of whack with revenues: Red Hat pulled in $627 million in 2008. Sun? More than $13 billion.

Such is Wall Street's confidence in Red Hat's Linux focus, however, that the market capitalizations between the two companies are almost at parity.

Both companies, of course, have product portfolios beyond Linux or Unix. Sun, in particular, has been significantly expanding its portfolio to include full systems that comprise software (OS, database, storage, portals, etc.), services, and hardware.

Given enough time for its open-source strategy to play out, Sun's market capitalization will likely recover and outpace Red Hat's. But for now, a symbolic moment is about to occur. The inauguration of the Linux-based economy?

Matt Asay brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. Matt is vice president of business development at Alfresco, a company that develops open-source software for content management. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure. You can follow Matt on Twitter @mjasay.
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by runedancer January 22, 2009 9:39 AM PST
Let's rewrite this a little:

Apple, perhaps unfairly, represents a fading Unix market. Red Hat, for its part, represents the rising Linux market.

As I write this, Red Hat's market capitalization sits at $2.62 billion, while Apple is just ahead, at $78.354 billion. The stock prices are way out of whack with revenues: Red Hat pulled in $627 million in 2008. Apple? More than $32 billion.

I think Apple is much better exemplar of the "fading" Unix market than Sun, but maybe we want to argue whether BSD is Unix.

Remember the old days when every few weeks a pundit would recommend that Sun buy Apple because of the "synergies"?
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About The Open Road

Matt Asay brings a decade of in-the-trenches open-source business and legal experience to the Open Road, with an emphasis on emerging open-source business strategies and opportunities. Matt is general manager of the Americas division and vice president of business development at Alfresco, a company that develops open-source software for content management. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure.

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