April 7, 1999

Dell Bolsters Support of Windows Rival Linux

By REUTERS

ell Computer Corp., the top supplier of personal computers to corporations, Tuesday became the latest computer maker to show support for Linux, an alternative to Microsoft Corp.'s Windows software.

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In a series of announcements, Dell said it had taken an equity stake in Red Hat, a leading supplier of Linux software and services, and was now offering to install Linux on some Dell server and workstation computers and would shortly offer it on desktops.

Linux, a variant of the Unix software system used to run large-scale business operations, is maintained by a far-flung group of software programmers instead of being controlled by one company.

As such, the software presents a growing challenge to existing software systems, although its use on desktop PCs has been limited because the most widely used desktop program, the Microsoft Office suite, does not run on Linux.

In a further endorsement of Linux, Dell said it had signed up a new corporate customer -- clothing retailer Burlington Coat Factory Warehouse Corp. -- to buy 1,250 desktop PCs running Linux as its operating system software.

Burlington said its 264 stores would manage their day-to-day retail business on Dell desktop PCs customized to run Linux software.

Mike Prince, Burlington's chief technology officer, said he had gone shopping for a Unix system and found that a personal computer company -- Dell -- now offered Linux. That broadened his choices beyond such traditional vendors as Sun Microsystems Inc. and Santa Cruz Operation Inc.

"Linux is rock-solid," Prince said. "It has a tremendous amount of mind share. It is unifying Unix in a way that it has never been before."

The deal is one of the largest examples to date of how Linux is finding wider acceptance on desktop computers.

Dell said it would offer Linux on selected PowerEdge servers, which are machines used to manage networks of other personal computers (PCs), and Precision workstations, its powerful PCs used by researchers and designers on data-intensive tasks.

The PC maker said it planned to offer Linux on its Optiplex line of corporate desktop PCs during the first half of 1999. Dell also boasted that it had become the first computer vendor to offer Web-based ordering of Linux computers.

The significance of the desktop PC contract is that while many computer makers have begun offering Linux as an option on entry-level server machines, Linux is not yet in widespread use on desktop computers used by individuals.

Such Linux-based servers may represent a sales come-on by computer makers to small and medium-size businesses that might otherwise not purchase more expensive server machines.

Analysts believe that low-cost servers running the free Linux server software are designed to entice businesses to buy the companies' servers, with the goal of later selling them more expensive machines running Unix or Microsoft Windows NT server software.

By investing in Red Hat, Dell joins a variety of computer industry heavyweights with stakes in the closely held Durham, N.C., company, including Compaq Computer Corp., International Business Machines Corp., Intel Corp. and America Online Inc.'s Netscape business.

Fast-growing Dell is the world's leading direct supplier of PCs and in recent quarters has surged to become the top provider of PC systems of all sorts to corporations, according to research from ZD Market Intelligence.

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