Going after Novell customers
The only area where Linux is winning is in companies where Unix customers want to take their custom applications and move them to x86, Muglia said. "There is an unstoppable trend in the x86 market to move away from proprietary Unix systems like Sun[s] Solaris," Muglia said. "That trend means that the majority of those systems in the future will be running Windows, with a minority running Linux and an even smaller minority running Solaris." The real issue is determining how vulnerable proprietary Unix systems are to migrations to low-cost machines and whether those migrations will be to Linux or Windows.Riley said Microsoft is ignoring the fact that those companies that were marketers of Unix for the enterprise are now also pushing Linux. "I am talking specifically about HP, IBM and Novell. I think Microsoft is using selective statistic reading and are downplaying the threat," Riley said. Sun officials said the battle for software market share among Solaris, Linux and Windows will be hard-fought at the low-end, low-cost x86 level, especially in the small-tier to midtier space. "I think Linux is taking customers away from Microsoft at the low end as people are looking at getting more security through a Linux/Unix platform," said Paula Patel, director of market development for Solaris 10 at Sun, in Santa Clara, Calif. "In the one- and two-way space, the migration is away from the Microsoft-installed base, while Linux does not compete at the eight-way-and-above platform, which is the Solaris sweet spot." Muglia said Solaris has always played into the high end of the market rather than on the volume side, but he dismissed any threat to the Windows Server business from the upcoming release of Solaris 10. In fact, Muglia said, as Microsoft has moved into the high end with Windows, it now has the opportunity to win customers from Solaris. "I certainly dont see a substantive threat from Solaris taking out Windows," Muglia said. For his part, John Loiacono, Suns executive vice president for software, shrugged off those comments, saying Suns upcoming release of both Solaris 10 and Open Solaris will continue to meet existing and new customer needs. Sun is concentrating on shipping Solaris 10 and making Open Solaris available this quarter. The company will also continue to innovate on its business model, especially around the Java Enterprise System and its pricing, he said. Next Page: Microsoft focuses on Service Pack.
Muglia contended that both Sun and Novell Inc. could become vulnerable to the move away from proprietary Unix as Microsoft targets customers from both companies. Novell is trying to move its legacy NetWare customers to another platform, primarily Linux, but "that is a tough transition, and we expect to be able to pick up a fair number of those customers over the coming years," Muglia said. He added that Microsoft recently started a program to lure NetWare customers to Windows, a program that will be ratcheted up this year.