Scott scoffs at analysts' SCOrn

Several US analysts who follow server operating systems have gone on record as predicting that Santa Cruz Operation's (SCO's) days as a Unix operating-system vendor are numbered and that the company will have to become a service-and-support organisation to survive.

`I think the future for SCO is more in service and products such as Tarantella, rather than in operating systems. I've talked to several companies with point-of-sales applications where Linux is displacing SCO,' said analyst Stacey Quandt from Giga Information Group.

Before heading off to the US to take up a promotion, Brad Scott, SCO's Australian general manager, told ARN he didn't agree with the line of analysis portraying Linux as a threat to SCO's OS products.

He pointed to the 30 per cent revenue growth (35 per cent in Australia and New Zealand) and share price increases as indicators of the true customer and investor confidence in SCO.

`These comments can only be classed as mischievous,' Scott said. `Our opportunity far outweighs any threat. [SCO] has never been in a stronger financial position. We didn't grow last year in face of all the Linux hype on anything other than our operating systems.

`Clearly our company is changing. There are big opportunities for us in professional services, and we are beefing them up, on the back of development in the Intel technology space.

`As far as we are concerned, Linux also presents a very big opportunity for SCO. In the last 24 months we have created a professional services organisation focused mainly on our products but also looking to provide Linux services.'

Recently, at LinuxWorld in New York, SCO said it was porting its Tarantella Web-server software to Linux. The product, due in the second quarter, would be SCO's first commercial offering for the Linux platform, though the company began offering support for Linux users last year.

SCO led in Unix server operating system shipments in 1999, according to preliminary data from analyst International Data Corp (IDC). But all Unix variants amounted to only 15 per cent of total server operating system software purchased last year, compared with Linux's 25 per cent.

`They're facing the fact that their best channel is starting to look to Linux, and they're trying to position themselves as having been through the wars,' said Dan Kusnetzky, an analyst at IDC. SCO is trying to appeal to the major Linux vendors with its worldwide service organisation, he said.

To emphasise its commitment, SCO invited top executives from Caldera and Germany's SuSE to sit with SCO executives during the Tarantella announcement at LinuxWorld.

`SCO is trying very hard to look benevolent and supportive of open-source computing, but Linux is clearly a competitive operating system on Intel that can only hurt SCO,' said George Weiss, an analyst at GartnerGroup.

SCO's Scott disagreed, saying that Linux `is not displacing SCO environments. It is displacing NT,' he said.

With 100 per cent of its revenues generated through channels, Scott said SCO `clearly has a desire' to break out of its 98 per cent dependence on products.

`Our challenge is not a technical one - it is a marketing one. We have to form partnerships with the right types of resellers, integrators and other technology suppliers in the enterprise space to mature into an enterprise player,' Scott said.