Canonical seeks profit from free Ubuntu

If you want to understand Canonical's Linux business strategy, think Red Hat 2000.

Canonical is the 65-employee start-up behind a popular version of Linux called "Ubuntu". The company is betting that it can win a place in the market using a strategy that dominant Linux seller Red Hat has dropped.

Red Hat offers two versions of Linux: Fedora Core and Red Hat Enterprise Linux. Fedora Core is free, but relatively untested and unsupported by Red Hat, while RHEL is supported and certified, but must be purchased. With Canonical's Ubuntu, however, the free and supported versions are identical--the approach Red Hat abandoned in 2003.

"We believe that Ubuntu should be free to everyone--not just a trial version, but our very best version," said Christopher Kenyon, Canonical's business development manager. The South African company even ships free CDs anywhere in the world. Using that strategy, it expects profitability within 24 months, he added.

Ubuntu has become popular among enthusiasts, though measurements of this are hard to come by; the most oft-cited statistic is Ubuntu's long-standing top placement at Linux version tracker DistroWatch. Canonical is counting on converting that popularity into business, and competitors should take note.

"If I were Red Hat or Novell, I would be watching Canonical's moves very closely," said The 451 Group analyst Raven Zachary. "It has the buzz in the open-source community that Red Hat had in the late 1990s."

Down-to-earth Linux
Canonical, founded in early 2004, is the brainchild of Mark Shuttleworth. In the years before Canonical, Shuttleworth founded security firm Thawte Consulting, sold it to VeriSign for $575 million and rode a Russian rocket to spend eight days in orbit at the International Space Station.

The company has built a certain whimsy into the Ubuntu project. Product names are one example: The first version, Warty Warthog, arrived in 2004, followed by Breezy Badger and Hoary Hedgehog in 2005, and Dapper Drake in June 2006. If the project makes its schedule, expect Edgy Eft to arrive this month.

And Ubuntu's name takes the open-source movement's feel-good collectivism to a new level: the African word translates to "humanity to others" or "I am what I am because of who we all are."

But the company has button-down business intentions. Dapper Drake was the first Ubuntu version with long-term support from any source--five years for the server version and three for the desktop, compared with 18 months for regular Ubuntu versions.

Ubuntu has largely been a desktop computer phenomenon. Shortly after the Dapper Drake launch, however, Canonical began advertising its Ubuntu server version as well.

"We started the campaign in August as part of an awareness drive about Ubuntu on the server," Kenyon said. "People typically think of Ubuntu on the desktop, and even members of the broader technology community are unaware of the growth of use of Ubuntu on the server."

"I'm actively contemplating installing (Ubuntu) for a few friends and family, because I'm sick of de-spywaring their Windows machines."

--Stephen O'Grady, analyst, RedMonk

The desktop software has attracted fans. Among them is Linux user and RedMonk analyst Stephen O'Grady. "It's quite impressive," he said of Ubuntu, citing easy software installation, a thriving community of users and a clean, simple design.

"I'm actively contemplating installing it for a few friends and family, because I'm sick of de-spywaring their Windows machines," O'Grady said.

Canonical is donning the trappings of traditional software companies: It's seeking certifications that Ubuntu works with other products, and database giant Oracle has working to ensure its Oracle 10G Express version works on Ubuntu, Kenyon said. It can't yet supply client references, but it has customers among technology companies, financial institutions, start-ups, governments and schools. In addition, the company has a support staff based in Montreal.

Canonical charges $250 per year for PC support during business hours and $2,750 per year for round-the-clock server support. In addition, a number of business partners also offer support, Kenyon said.

That hybrid-support approach means it's not clear that Canonical will get the support revenue, Zachary said. "Will Ubuntu follow the example of Apache Web Server or JBoss? With the Apache Web server, expertise became distributed quickly within organizations, and revenue opportunities were relegated to individual consultants," Zachary said. "With JBoss (application server software), revenue opportunity consolidated around JBoss, which is now part of Red Hat."

[richto]

Because LINUX is so crap and hard to use that you have to pay for support.

That is hardly surprising as LINUX is so crap and hard to use that you have to pay for support to be able to use it in a consumer or business environment. Not to mention all those zillions of security patches to try and keep up to date with. No wonder its still less than 1% of the desktop OS market...

Have to compile software before you can run it? what a joke...

[dragonbite]

You haven't taken your head out of ...

I imagine all those people that pay for Microsoft support is because it is crap too? Even in the company I worked for that had it's own help-desk it had support contracts for their systems.

Businesses want the reassurance that when the proverbial poop hits the fan, that somebody is accountable to make it work ("... and make it work NOW!") and it doesn't matter what system you are using.

Zillions of security patches? I haven't seen THAT. What updates come through are easily done in a couple mouse clicks (Reload, Mark All Upgrades, Apply) **Note: no command lines need be typed**

From an IT department's point of view it can also be controlled so that people update from a local server only what is approved!

Compiling software myself? That is so old-fashioned! I've gotten Ubuntu fully operational without having to go into the command line once.

The last time I had to compile software myself was when I was running a source-code based distro of Linux (Gentoo) where EVERYTHING is compiled (using Portage though) and that's the way that one is built to work. Businesses, though, will likely NOT use this distro for production.

90-99% of the distros these days have package managers so that you don't need to go into the command line and updates cover all of the programs installed, not just ones from this or that vendor.

There is less and less difference between Linux, Mac and Windows and regardless, businesses that can afford it, will get service contracts.

It's like insurance.. you pay for it in hopes you don't need it, and are thankful you have it when you do.

[Dachi]

Well, you are not 100% wrong.

I have been using Linux and Windows for about the same amount of time, and I would agree that someone savvy is less likely to need support for Windows.

Also, I hold no bias, but I will say that it sounds like you have not tried Ubuntu and that things really have improved since your last impressions with "Linux".

Try this:
1) Install Ubuntu
2) go to <a class="jive-link-external" href="http://ubuntuguide.org" target="_newWindow">http://ubuntuguide.org</a>
3) "add extra repositories"
4) copy past the instructions for any thing else you need, flash java etc..

If that sounds like too much work look at "How to use Easy Ubuntu"

If you finish that and still believe that was difficult, come back here and say so.

[NICU28]

Linux is easy these days

Linux is very easy especially Ubuntu. I switched from XP to Ubuntu when the Windows Genuine Advantage took the guilty until proven innocent approach... (I do own my copy of XP its just annoying) Anyway Ubuntu installed much faster and easier than XP and with the program (script) "Automatix" it will install and configure almost anything you'd need that doesn't already come standard. Give it a shot before you bash it. The install CD is actually a LiveCD so you can try it before you install it without affecting your computer.

[Too Old For IT]

Darn Straight!

The average Linux distro has a learning curve not unlike mounting an ascent of K2 during the monsoon. Documentation rarely rises above the "if you are `leet you already knows this so no need to document it" stage.

[jabbotts]

TROLL

A Troll! Look kids, a Troll! Honey, come quick and bring the camera!

Seriously, you've not a clue what your talking about. You'll find more free support information on linux distributions than most other OS. Update patches are delivered when discovered not when schedualled through very easy to manage mediums.

It's close minded indaviduals like yourself who've baught the brand hype and accepted pop culture brainwashing which says Microsoft is the only way.

[kjeckell]

Obviously You Are Not The Intended Market

While Linux based systems do have a learning curve they aren't difficult to manage on your own with a little practice. It seems that for you, Microsofts dumbed down approach works. For those of us in the IT world that need more than what MS will allow, we need Linux. As for the constant patching, I hope you understand that MS only puts out fewer because they need to wait for someone to find the hole before they will patch it. With open-source you get the benefit of having millions of people looking at the code and finding issues before they become problems. I only wish MS would put out more patches to plug the NUMEROUS holes that their OS's have.

Maybe you should stick with MS, the Linux world doesn't need people who can't even compile software.

[slim-1]

richto is the first PC novice that had a hard time using Ubuntu

Or he is a non novice that has never tried Ubuntu but Windows is great because he uses it.

Or he is a Windows Tech support person who doesn't know about Linux so he has a conflict of interest and is looking out for his job security.

[ramonklown]

What about windows update?

You still gotta keep up with the crap in windows, the patches you update in linux you don't have to know about it just like in windows. But Linux is still harder to use, hell yeah, the magic behind ubuntu is that is easier to use and it's stable, that's way more than what Bill Gates is offering.

[Ph0enix49]

Winblows

What a stupid comment. You don't realize what you are speaking about.. Have you ever used linux? no? Then go home man, how can u write such things, or things you don't know. Kid :)

[civic_si]

LINUX is not crap

Linux is not hard to use either. i have Linux machines and windows machines. Have you ever had to call microsoft for support do you think that its free to call them for support it costs a lot more to call them than it does to call for support for Ubuntu. There are security pathches that need to be installed but at least you can get them for Linux and not wait six weeks for the microsoft ones as all the spyware eats up your machine. there are a few apps that you might have to compile but they are FREE and you dont have to install them and if you look on the web most of the time you can find them in a package. linux is much better than windows in my opinion..

[Blito]

Linux is nice but very centralized

Linux does offer patching thorugh it's patching network just like Windows on a regualr basis. The patching is just the same and they do patch their apps more because they are free updates of course. I sometimes don't like the idea od Betaware in the database but Ubuntu seems to keep the install and uninstall clean enough, and I think they state if the product is unfinished or beta. Betaware can mess up, for instance, if your running a deathmatch video game.

I don't prefer messy config directories in the home directory in Linux and wish they would separate the Documents a little from the 'lowercase' odd looking config folders. Plus I prefer Windows commands than UNIX since UINIX can feel more managed. You are forced to rely on the way they organize their dependacies and their centralized structure can feel like your part of a school or government library sometimes

As far as running high end graphics solutions like games and simulations, The Playstation 3 does it just fine it seems since it's using Linux. Can that work in a sometimes messy Linux machine for everyone in the mainstream? I prefer open source but not sure about Linux.

[lonewolf367]

Ubuntu taking desktops by storm

I myself run Mac OSX and Fedora Core 5 on my home systems. I have installed Ubuntu on 5+ friends computers, most of which are total computer novices using Windows XP Home. They have since helped others install and spread ubuntu around and have had no issues using it. They quickly adapted and with the great package manager support finding and installing software can't possibly get easier.
Since my friends aren't nerdy they don't compile software or play in the terminal and they get around perfectly fine. I hope to see more make the switch since its far easier than Windows if you wan't it to be but also gives you tons of depth satisfying power users as well.

[Hoser McMoose]

I wish them well but...

I do hope the Ubuntu folk succeed, but I think they're going to be fighting something of a losing battle. Ubuntu seems most successful in the desktop market, and people just aren't willing to pay for support for desktop systems. Even for Windows were MS chargest $100+ they provide virtually no support. Buy an OEM computer with Windows and you get a whole 15-30 days worth of support and that's it. People might complain beyond that point, but they aren't willing to pay for continued support.

Beyond the fact that few people are willing to pay for support, Ubuntu are fighting against themselves with a sort of two-edged sword. People only need support when things aren't working properly, but if things don't work properly then people aren't going to want to switch to this OS.

As for me, I've downloaded and installed Ubuntu. It is VERY easy too install and use, almost trivially so. However it wasn't flexible enough for my needs. But I'm something of a computer geek, and this is definitely not an OS for geeks, it's an OS for those who want something that JUST WORKS.

[qwerty75]

yup

Try SuSE 10.1, it is more flexible and even more easy to use then Ubunutu, although this will not be the case forever. Ubuntu is likely the future and will take a huge chunk away from Microcrap, but not today.

[technewsjunkie]

There's far more money supporting Windows - because it needs it.

The Windows "support" industry is HUGE because Windows has a
lot of problems.

No wonder Windows bigots defend it - they are being financially
supported by it! How many own MS stock?

[Too Old For IT]

If Windows worked right all the time

If Windows worked right all the time a lot of us would have to find something constructive to do. Like rid the planet of Islamic Jihad, for instance.

[Jim Hubbard]

I can't believe people fall for this.....

Mark Shuttleworth has successfully built an image of caring about the public and putting out Ubuntu in an almost Robin Hood fashion.

They continue to build thier image on "FREE (as in beer)" software. But, if your free beer is flat, you simply ask and get another one - FREE and you don't have to pay the bartender to help you fix your flat beer.

If Ubuntu falls flat, you have to pay for the "free" help to fix it.

Ubuntu is not the grandfatherly helpful OS you have been led to believe. It is a fantastic marketing ploy for a person looking to build on his multi-million dollar fortune.

Mark Shuttleworth has played people for suckers, and (knowing people like I do) he'll probably make a killing at it.

Hey, Mark! Not only should software be free, it should be simple enough to use that you don't have to pay a multi-millionaire to help you run it.

This is like a doctor advertising free medicine for everyone, then charging you for the prescription that tells you how to take it or waiting until you take too much and charging you to help get you through an overdose.

Of course, you could just take the meds and guess at how much and when to take them. Or, you could look online for how much of a medicine to take, how often to take it, what side effects to watch for and what NOT to take with your meds. Sure....that sounds like fun!

So go ahead! Take your Ubuntu.....but you'd better have a degree in Linux or get ready to pay Dr. Mark Shuttleworth to help save your data.

[slim-1]

How about actually trying Ubuntu 1st

Download the live CD.

Open up the package manager and look at all the free software you can install.

Next look at all the easy to use (much easier than Windows) network setup tools.

Click the install button and spit your drive for a dual boot. You will want to make your Windows drive smaller than your Ubuntu Linux drive because you won't be using it much.

Next you are ready to do some work. Open OpenOffice to do a spreadsheet or write a letter, open Evolution to setup for email, open FireFox for web browsing. You can burn a CD or DVD. All this after your first logon. Within 20 minutes of clicking the install button you can be working.

Within minutes you will be like a kid in a candy store when you go back to the software package manager looking at all the great free software.

[BLTicklemonster]

Jump to conclusions?

I think you read too much into the article. Businesses pay for support for software anyway, so it's status quo. But every day desktop users pay nothing, we just go to the forums.

[boxxertrumps]

It works. Its fast. Its kubuntu!

im using kubuntu right now, its just ubuntu with
a different desktop enviroment...
It's fast.
It's easy.
It's takes up little space on the HDD.
No viruses on the internet for linux anymore.
The viruses failed miserably after their
releases.
Comes with a bunch of programs that the average
user needs, all the ones users would want are
free, and easy to get. (Adept installer FTW)

[dturner0413]

If you can't figure out how to run it, you're probably an idiot, maybe computers aren't for you at all?

[obits3]

Jim, here is the problem with your logic:
Let's say you win a free car on some TV game show. Is it the game show's fault if you don't know how to drive? After you get the car, you can learn how to drive it yourself, ask other people, OR you can hire a professional to teach you how to drive.

Also, try to remember the first time you couldn't do something in Windows. You probably called tech support that you probably paid for when you bought the computer or you asked a friend. It is hypocritical to say that a Linux distro is evil for using the same support systems (friends and professionals) as Windows!

I unstalled it last week

Definately the nicest GUI I've seen in a linux distribution. It'd certainly be suitable I think for casual computer users. Connected out of the box to the windows network, too. But shiny GUI and all, simple apps such as the file browser, while better than they were a few years ago, still seem a bit unrefined compared to their windows counterparts.

One thing I dont like about ubuntu is the default 'root-less' approach. Though you can change that easy enough.

[boxxertrumps]

Sudo is there for a reason.

bad idea, as programs you run have root access
and that includes malware...
Just use sudo on the command line if you want
get root access.

[maxwis]

Rough Around The Edges, Brittle

I spent a significant number of hours installing and configuring Dapper on both a desktop and laptop computer, and later Edgy. With the exception of a driver for my laptop's wireless card, it basically "worked" out of the box. But it took way to much trial and error to get things like Java to install. Once I had Java installed, I had to muck around some more to get a symbolic link from Java to Firefox so Firefox would recognize the plugin.

You'll be at a disadvantage playing multimedia files in Ubuntu because of codec licensing restrictions. Forget about playing Quicktime files, Apple has no port of Quicktime to Linux. Need to search for a file? Nautilus search is a joke. Install Beagle to have a decent search? Go ahead, you won't be able to search based on file dates or file size, basic things you can do and expect to be able to do using Windows file search. Need drivers for hardware to access advanced capability? Good luck. ATI has no Linux driver for my All In Wonder card. I have video support but no TV tuner support.

In its present form, Ubuntu is not suitable for the mainstream consumer. If Shuttleworth thinks he can crack that market then he will have to dump a ton more money into the product. Ubuntu does work for the IT pro and for the hobbyist who has time on his hands and likes to tinker. The tinkering got old for me when I just needed to get something done and tired of having to do online searches to find out how to do stuff, and then go through trial and error to make it work.

[DarkPhoenixFF4]

Thank you, Microsoft!

Yes, this is the Microsoft legacy. "Well, Windows is the only thing that matters, so we'll make our stuff work on Windows only!"

As for Quicktime, IMO Apple's approach is really conceited. They're leveraging opensource to improve OSX, but they rarely (if ever) give anything back. There should have been a version of Quicktime for Linux by now.

Then again, there should have been an updated version of Flash for Linux by now, too...

[zolyfarkas]

you want fre RHEL with online updates use CENTOS

<a class="jive-link-external" href="http://www.centos.org/" target="_newWindow">http://www.centos.org/</a>

[zolyfarkas]

you could be the next us president

sounds like your qualified :-)

[cubicleslave1]

errr... what about a mac?

Mac OSX is pretty, is solid, and just works right out of the box. It has a very nice GUI. It is a great platform for performing all manner of multimedia tasks, using software that comes with it. It is very user and idiot- friendly. It may not have as much application support as the sum total of all Linux applications, but it definitely has more than any single flavor of Linux. It is not bullet proof, but is still an inherently more secure design than Windows, due to the lack of a registry, and the fact that windows allows all manner of crap to be bound into its kernel. And Mac OSX is founded on bsd unix. In short, it is everything that Linux is aspiring to be, and has aspired to from day one, but will never become, due to the apalling process of balkanization it has undergone over the years. I cannot emphasize this last point enough. So why not just use mac os X, and get on with life?

[JFDMit]

Sure! I'll just install MacOS...

...on the sundry PCs scattered around my office and...oh, wait a minute... I can't. I have to buy a Mac to do that.

Don't get me wrong, I have a nice shiny MacBook Pro that I love, but I use Ubuntu on my other, non-Mac machines. Now if Apple would support MacOS on non-Mac hardware...but we know that won't happen.

[civic_si]

Mac OS

i would love to use the Mac OS but i dont want my hardware to be propriatary by Mac. theres nothing wrong with there hardware but i cant go online to many stores and buy something if i need it. and i like having a choice in the hardware that i buy. i have to admit though the OS X is one of the best looking OS's out of the box.

[amyjiangsu]

original stuff

Chris made it very clear that Canonical will be seeking sustainability in its original way. Ubuntu Linux is the product of innovation, the way to market Ubuntu would innovative and original too!

[amyjiangsu]

original stuff

Chris made it very clear that Canonical will be seeking sustainability in its original way. Ubuntu Linux is the product of innovation, the way to market Ubuntu would be innovative and original too!

[waynetalb]

Inaccurate information

Canonical is not a South African Company. It is registered in the Isle of man (www.canonical.com) In fact very little of Ubuntu is managed from South Africa. Mark Shuttleworth now has his primary residence in Europe.

[Mendz]

So far...

... the real successful business model for Linux is exemplified by Red Hat's practices. Eventually, I think most Linux distros should follow suit.

Offering a Linux version for free is really just a way to help "widen the playground" so to speak. But even so, consumers are usually not buying -- most of them in to it for the fact that Linux is free. Eventually, widening the playground is really just a popularity game. After that, reality sets in and you need real cash flowing in.

So for serious earnings, Linux distros are left with no choice but to either get corporate or government accounts. Hopefully, even that is not tough for Linux.

The business side of supporting a free product can hit hard...

[twasserman]

Opportunities outside the US

c|net's article focuses on the business situation in the US. It's a big world out there, and lots of people and companies would prefer not to send their software dollars to the US, home of Microsoft, Novell, RedHat and Oracle. Canonical can build a successful business without having a single paying customer in the US. By the way, Mark Shuttleworth's current home is in London, though he seems to spend most of his time traveling to support the work of his foundations (<a class="jive-link-external" href="http://www.shuttleworthfoundation.org" target="_newWindow">http://www.shuttleworthfoundation.org</a>) and to promote Ubuntu.

[Seaspray0]

It's not free?

From the story: "Red Hat offers two versions of Linux: Fedora Core and Red Hat Enterprise Linux. Fedora Core is free, but relatively untested and unsupported by Red Hat, while RHEL is supported and certified, but must be purchased."

RHEL is not free? How does this not violate the GPL? Is this the only version of linux that isn't free? What is the cost/licensing? If you wish to run an enterprise server on linux, is this your best option (are there alternatives that are free and widely used that are as good or better)? I'm looking for honest answers, please.

[ben::zen]

Support

It's the support and updates for one year that cost money. The same stuff goes into Fedora and RHEL, it's just the ability to call and say, "My computer's ****ed up, help me." and they'll do it for you. There's no violation of the GPL there, it's just that you get better support for the money.

[i_made_this]

the commercialization of Linux provides an...

...excellent opportunity for some shrewd OEM to pre-install it as a significantly cheaper and more secure option to Windows. All the OEM needs to do is provide the Linux o/s plus guarantee on-going live support like Canonical's doing for an allin price of $250. Mike Hell certainly has given up guaranteeing the integrity of Windows - he can be equally casual with Linux and sell more PC's at a lower price point. But I sense another OEM will beat him to it.

[twasserman]

Preinstalled Linux

Linspire does this. If you do a search on "oem linux" or "oem linspire" you will find some companies in this business. Of course, it's much more common outside the US, where you can get machines from Dell, HP, and other vendors with a supported Linux distro preinstalled.

[lab4rn4]

Still needs work

I recently installed ubuntu, I chose ubuntu because I'm still a full windows person so, ubuntu is kind of a for dummies version of linux, but still needs a lot of work, the hardest thing to get used to on linux is installing software, you have to compile it yourself??? what's up with that?? I think that just by fixing that, making auto-installers more available it would gain a hell of a lot more popularity because to a normal user there'd be absolutely no difference between ubuntu and windows.

[angrykeyboarder]

Ubuntu Linux isn't from South Africa.

It's from the United Kingdom.

[EricM770]

To Mr. Linux is Crap

I agree with you. No just kidding. However, don't make those of us who prefer Windows sound like morons. Truthfully, I don't like Linux that much. I've used it but unfortunately haven't found it a good alternative to Windows due to simple application compatibility. Is Linux crap? No. It definitely has its good points but it's just not for me. I use XP and Vista and I'm fine with those operating systems. I've tried Linux and the learning curve is higher than Windows on installing some stuff, particularly accessing the terminal, which for a desktop user is not convenient. However, it does install quickly and gets you going on basic stuff. Just don't expect good gaming on Linux. And that's one of the biggest reasons I don't switch to Linux, lack of gaming.
At work I use Windows Server 2003 because it's a lot easier to configure and integrate into a Windows environment than Linux would ever be. Sure Windows 2003 costs more initially, but Linux ends up costing more in the end due to all the support calls I would have to make to get it all working.
Linux has its good points as well as its bad points much like Windows. I personally prefer Windows, but hey, Linux is not bad either.

[tlcoffee]

So about a year and a half has past since the last comment to this article and I wonder how many of the commenters who said no to linux now use Ubuntu? :)

I understand that people enjoy the easy of use that comes with windows but now that ubuntu provides that exact same ease plus the repositories for open sourced applications that are equivocally the same as applications that cost money to have in windows.

The only problem I have with windows is Microsofts End-User License Agreement + each new version of windows requires more and expensive hardware to run its operating system. Some people simply can't afford to keep purchasing equipment like that. I could go upgrade my workstation hardware and install windows vista if I wanted to, but why? I take good care of my hardware and my primary workstation is about 7 years old with the exception of a new monitor. I couldn't run Vista on it if I tried. Do I want to? No I don't. Why? Because I get all the eyecandy I want already using the hardware I have with Ubuntu as my operating system. And do you know what? I even get to play my all-time favorite game "even though" I'm using linux. Thank you Bioware, you rock, and thank you Canonical for developing the true desktop for humanity.

For 15 years I have been a linux consultant. Now I guess you can consider me an Ubuntu consultant because I have migrated nearly all my clients servers and workstations to...thats right, Ubuntu.