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Could Microsoft Buy Red Hat?
An anonymous reader writes "Various news sources including ZDnet are today reporting that Microsoft is considering buying out Red Hat, speculating that 'Microsoft could see Red Hat's acquisition as a nice way to undermine IBM, but might not consider that a sufficient reason to do it,' adding that Red Hat is however '...a company that wants to be Microsoft and, like Microsoft, makes its living packaging and selling other people's ideas.'" That description seems to miss the key point that Red Hat releases the software they package and sell as Free software, and that both companies pay coders to create and improve software in the first place.
Only this and nothing more.
While the articles make a case that it might be beneficial for RedHat, what's in it for Microsoft? Plus, what are the chances of it clearing anti-trust hurdles?
"I'd rather be a lightning rod than a seismometer." -Ken Kesey
Or perhaps they could buy them out to shut them down?
I was reading this with a 'this just might be' attitude, until I came across "This combined with the the fact that the single biggest threat Red Hat faces right now is that of the possiblity of IBM could settling with SCO and then release its own Linux, (...)
IBM settling with SCO while they seem to be holding them at their balls? And then releasing their own linux distro? Yeah, right.
This 'article' is nothing, ziltch, nada, nop. No new facts, no reasoning, no nothing.
Wenn ist das Nunstueck git und Slotermeyer? Ja! Beiherhund das Oder die Flipperwaldt gersput.
There is no way that this is remotely even feasible. Why would Microsoft want to buy Red Hat? Those with their tinfoil hats on would say so that could shut down Red Hat and thus, rid the world of a primary Linux-powered rival. However, think about it - someone would simply take their place - Novell, some corporate entity supporting a Debian or Gentoo distro - and they'd be right back where they started.
Others might think that Microsoft is ready to get into the Linux biz. For those, I have a large iron structure in Paris that I'm trying to get rid of; perhaps you'd be interested in buying?
If they did...what exactly would they be getting? a Duplicate company called...say "Blue hat" could pop up in a couple of weeks with a duplicate copy of everything Redhat sells (besides the copyrighted red fedora) and start selling copies just like before.
Redhat's profits are primarily from service contracts and their automated patch udpates.
Remeber...everything is GPL'd...so buying out Redhat would at most just give MS some time (against Redhat ONLY)....there ARE other LINUX distros out there....like Mandrake...SuSE.....MEPIS...debian......
The reason, why this is not going to happen is not the fact its a complete lunacy, but the fact that Microsoft already has a monopoly position in the market and has been convicted from abusing that position. Buying any company trying to create a competition in the PC Operating System market would be laughed out by the FTC. :)
If programs would be read like poetry, most programmers would be Vogons.
Not only would this not be likely to be approved due to antitrust rules and such, what would be the point of such a purchase? Paying a large chunk of change for a competitor to do...what exactly? Microsoft isn't going to suddenly say "WinServer 2003 blows, here's RHEL 4" to all its customers, undermining the last 5 years of FUD. A purchase like this would contribute nothing to the MSFT bottom line. Not to mention that this completely ignores the efforts of Novell and SuSE. If RH went out, someone else would line up to take its place in a heartbeat.
Actually I don't like Microsoft, and they do tend to make really stupid mistakes from time to time. Ignoring the Internet for so long. Microsoft Bob. WebTV. Others I'm sure we can think of.
But I don't think they'll make this one, for all the reasons you mentioned, and possibly more: One, they're in denial. I think they believe they're superior in all ways, and unbeatable. Two, pride. "If you can't win 'em, join 'em", and they're not willing to admit they can't win, because they always have. Three, history: they never pick up on the latest technology until everyone else has, and they've still got a grip on the market.
Don't think of it as a flame---it's more like an argument that does 3d6 fire damage
Same thing I was thinking...
Being that Red Hat is one of the largest financial contributors to Linux and open source, Microsoft buying them and cutting that funding would take a huge chunk out of who they see as their only real threat at market dominance, the open/free community.
"A truly wise man realizes he knows nothing."
I wouldn't count on regulators stopping Microsoft from acquiring a competitor any time soon if that's what they want to do.
Don't blame me; I'm never given mod points.
And then the RH executives who lost their jobs as a result of the shutdown should just make a new company, with the same, or similar, products.
How does Microsoft win?
This would all make sense if RedHat could be purchased at a reasonable price. But right now RedHat is worth around 2 billion (they reported worth in their annual report of just over 1 billion based on at that time stock value or 7.25, stock is now 12.55, of course MS just needs to purchase a majority share.. And I'm not going to dig through their annual report that deeply.
Anyways most of what is RedHat is a free open-source program. So what would Microsoft be buying.
1. A building.
2. Its Employees (many of which would jump ship)
3. Some private code
4. The name (would would immediently be destroyed in many peoples eyes when Microsoft buys it)
This would effectivly be the worlds largest waste of money. While it may have some small long term goal of shutting down their compitition. Microsoft share holders would NEVER go for a billion+ dollar aquasition that would have almost nothing tangable about it.
MSFT has spent billions on marketing the idea that Windows is better in the server room than Unix and Linux. For them to turn around and buy a tier-1 Unix vendor would completely undermine that position. Likewise, Solaris is one of the few commercial OSes that can beat windows in the server room on technical merit, name recognition, and PHB appeal; for that reason it would be VERY unlikely that any merger would be approved.
Why is it that the proponents of "one nation under God" are so eager to get rid of "liberty and justice for all"?
It would make far more sense for Microsoft to invest in Red Hat than buy it outright. Look at their investment in Apple if you'd like a precedent. The idea has several advantages:
I'm not saying this is likely, but it would make a lot more sense and with as much cash as MS has, they can certainly afford either option. However, investing in an established rival is behavior Microsoft has exhibited before, and they do seem very much to not learn any new tricks.
"The Linux market offers little opportunities for complete domination."
In my uninformed opinion, if a company came out with a user-friendly Linux flavor that included all of the driver support of Windows, with none of virulent Linux zealot attitudes to go with it, it would totally dominate the consumer market.
"Moreover, could you really imagine Microsoft distributing software governed by the GPL after all the "viral code" FUD?"
Yes, and it would be easy since being two-faced isn't an issue for most companies. All they'd have to do is make the source available for download, and then sell their Linux products to that 90% of the consumer market that doesn't compile programs from source, and just wants to double-click a download to make it install.
As for competition, sure, other programmers could run with the source, but could they make a professional-grade UI to stick on the front end, or are we talking the mid-90s UI of KDE 3.x? More importantly, how many developers would work with Microsoft source code, given the virulent anti-MS attitude of the Linux community?
Frankly, if Microsoft entered Linux, I think the consumer market would embrace it big time to the tune of 15%-25% market share. Of course, who knows.
Peace.
fedora is too fast-moving, so you switch to gentoo? i want what YOU'RE smoking! :-P
i love gentoo btw, but it is not what one would call a stable platform. (and by stable i mean "unchanging" - it's great in terms of system dependability)
http://kered.org