I saw a Red Hat price list once -- it was shelved under "fiction". RHAT is not actually getting a grand a year for server support, so maybe this will make them stop pretending and put up more realistic list prices. $399 is still undercutting compared to a real world RHAT ASP, but not as much as it looks.

With the way the licensing works, Oracle (or HP, which did it first) can't indemnify any Linux customer without committing to actions that would make "cleared" code available to all Linux customers. So any indemnification that anyone offers has more effect as a clean bill of health for Linux in general than as FUD against other vendors.

And the part about bug fixes in future, not current releases is just wrong. Maybe someone at Oracle should get an RHN subscription and look at the logs of backported fixes.

The thing that interests me most is that there will be an enterprise edition of a Linux distro available _for free_ - if I interpret the above right. RHEL is not free, nor is SLES AFAIK. Distros such as CentOS were filling that void, but a big name company such as Oracle will give more assurance to (traditionally thinking) companies.

So, I don't think it is bad news at all. Just one more big vendor offering support. Plus a "new" free distro too for those not needing support.

Red Hat should be thanking Oracle for the resounding endorsement of its product, business model and, yes support. Imitation, after all, is the ultimate form of flattery! (Oracle support, even if dirt cheap, will driver customers to Red Hat!)

Matt,
This is called competition, right? Larry is merely putting into practice what open source ethos are about. You have a history of wanting it both ways: you want to claim "open source" (actually your company Alfresco's software does NOT meet Open Source definition, but that never stops you from using that trademarked term all the time), but you don't want competition when it shows up. I have nothing against proprietary models (nor true open source models) but I detest cynical manipulative tactics, which are all inspired by the "Red Hat business model".

Red Hat Enterprise Linux, with its open source claims, is NOT EVEN PUBLICLY AVAILABLE, in binary or source. They basically tie their support to your agreeing to not distribute the software. That is perfectly compatible with GPL, of course, but from a customer view point (I was one, so I should know), its effect is INDISTINGUISHABLE from proprietary software - not that there is anything wrong with proprietary software from a moral point of view, I am just tired of the hypocrisy, using open source as a false marketing slogan.

And Red Hat's pricing? Indistinguishable from Windows server pricing. Customers seem to be wising up. We witnessed the effect of it in the latest quarter: Red Hat missed. With their deceptive business model, and with a bit of "help" from Larry, they are going to miss, and miss again. What we witnessed is the peaking of Red Hat.

Larry is merely pointing out the nudity of the emperor here - way to go Larry (not that I would ever buy anything from his salesmen, of course :-))

True enough that I walk a bit of a tightrope on this - I'm as interested in commercializing open source as I am in proliferating it. You'll often see me take positions that favor commercial open source precisely because I think the more money there is to be made in open source, the more open source software there will be. That has long been my position.

As for my company's business model, I'm on the OSI board and think I have a reasonably clear idea as to what the OSD says. Ultimately, is there a right to fork? Yes, 100%.

And can you get Red Hat's source? Absolutely. It's the certified binary that you will struggle to get access to without paying - the uncompiled source is easy to get. Just ask CentOS.

Wrt Red Hat pricing being indistinguishable from Windows pricing, I guessed I missed why this was necessarily a bad thing. in fact, I think it's a great thing when open source pricing reaches parity with closed source pricing. As I've argued before, this means the argument is no longer about price, but rather about quality.

Red Hat has that in spades.

As far as I know, RHEL is currently sold *with support* bundled in (at least for the first year - after that, I guess you can not renew the support and switch to Oracle). So companies already have a year 1 support cost from Red Hat to consider [something not mentioned in the Oracle slides] and how many of those are going to switch to a current "unknown" in the Linux support arena like Oracle after the first year? Not many I suspect.

Now if Oracle really wanted to stick it to Red Hat, they'd offer their commercial support for CentOS (sort of like the way Canonical does so for Ubuntu) - that way, they get their enterprise customers from day one and not a year down the line.

Let's not forget that the reason most of the market adopted open source was because it was free (as in beer) or cheap. It was *not* because of superior quality, at least not initially. After all, Linux, for a long time, was not superior in quality to traditional Unixes like Solaris or HP-UX in any sense. So if *all* customers cared was quality, there was always Sun.

Red Hat model looks exactly like bait-and-switch - which a lot of "open source" guys seem to be emulating these days.

For what it is worth, here is my prediction. Cheap will win, open source or not. Quality is a given - cheap will need to come with acceptable high quality - and if business models like Red Hat require them to charge Windows-like prices, they will be eroded away. Cell phone subscription prices are dropping year after year. Why should software prices stay so high, year after year? As the code matures and volume goes up, shouldn't per-unit support costs be going down?

So I support Larry firing this shot (he is hypocritical himself, of course, but that is just Larry, and everyone knows exactly what they are getting from Larry). He is the kind of guy who shakes up the status quo by uttering uncomfortable truths, like exposing the built-in hypocrisy behind Red Hat's business model.

What's the difference between God and Larry Ellison?

God doesn't think he's Larry Ellison.

so how long will it be before the application AND the database AND the OS all come from Oracle?
Linux runs on just about every hardware size and vendor so the hardware becomes irrelevant and the cheapest (factor in reliability to get the real numbers on cheap) will win.
Port the database and all the apps to Oracle supported Linux and Oracle becomes a one stop shop for an enterprise solution (just add hardware, any hardware)

I just re-read the title "With friends like these"...

The software market has been one of co-opetion for quite some time now. Most software vendors compete in one segment of the software market, and cooperate in other segments.

When Red Hat decided to move into the middleware market, its middleware partners (IBM, HP, Oracle, etc) didn't get the same sympathy you're asking us to give Red Hat.

NOTE: I truly believe that Red Hat is not going to suffer too much long term because of Oracle's announcement. At the end of the day, it's difficult to believe that Oracle can provide better support for RHEL, a product that they don't really have any influence over. Sure, Oracle could fork RHEL, but Oracle has almost zero OSS cred, and they'd get next to nowhere down that path.

This may sound naive - but I have always thought
of Red Hat as an FSF contributor and not a
kernel contributor. I don't regard any of these
companies as important to the kernel.