Making a Profit From Free Software

N E W  Y O R K, Feb. 2 -- If you can get the Linux operating system for free, how are companies making money on it?

Unlike Microsoft’s Windows, nobody owns Linux. It’s a free project worked on by legions of volunteers who have adapted the program to fit specific needs from networking to servers to desktop applications. Many Linux programs, like the graphics software “gimp” and the Gnome desktop environment, are also free.

Linux distributors like Red Hat, Caldera and VA-Linux make their buck through “support and services.” They don’t own the basic operating system, so they sell boxes with documentation, support contracts, installation tools, add-on software, easy-to-use desktop environments — and legal protection for customers in case anything goes wrong. So far, they’ve been successful at penetrating more than 20 percent of the server market but hold less than 5 percent of the home and office desktop space, according to research firm International Data Corp.

“They’re trying to build other elements to their business that are going to be the cash generator. They’re offering services, they’re offering management capabilities,” said Al Gillen, an operating systems analyst for International Data Corp.

Linux software companies think they can master making a profit by selling applications built from free, open-source parts. Three of the most prominent, Eazel, Sun and Corel, have different strategies: one is going with support and services, one is using free software to drive purchases of costly hardware, and the third says, hey, time to pay for your application software.

An Open MindsetEazel’s Nautilus desktop environment — the most celebrated part of their business — is free, but that doesn’t worry them. The company which hopes to make Linux easy to use is banking its money on services.

Nautilus is based on the GNOME project, one of Linux’s two historic open-source desktops. Unlike Windows and the Mac, Linux doesn’t inherently have windows and icons as part of the operating system. Groups of programmers instead volunteered to build several competing “desktop environments,” the two most prominent of which are called GNOME and KDE.