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Red Hat: No Regrets About Moving to the Enterprise Model

When Red Hat had its IPO in 1999, there was no such thing as Enterprise Linux. Back then there was just Red Hat Linux, a fast moving distribution that had new releases every 6 months. That all changed with the introduction of the Red Hat Enterprise Linux (RHEL) model that debuted 10 years ago.

In a webcast event today, Red Hat executives reminisced about that milestone event and offered a few predictions about the future of their server operating system platform. Now after 10 years of releases and innovations, Paul Cormier, Executive Vice-President of Red Hat, sees the most important event in the history of RHEL as being the creation of the RHEL model itself.

As opposed to how Red Hat Linux was initially sold, RHEL introduced the idea of a subscription model. In the subscription model, enterprises pay a yearly subscription fee that entitles them to software support and usage. It's a model that offers recurring revenues to Red Hat, and one that enables enterprises to migrate from one version of RHEL to another whenever they are ready. Red Hat

"The introduction of that model was a crucial moment," Cormier said.

The first adopters of RHEL were Red Hat's financial services customers that saw the value of the subscription model. While RHEL ushered in a new era for enterprise server software, it also ended the era of Red Hat Linux.

When RHEL was introduced, Red Hat Linux ended up getting merged into the Fedora Linux project. While 10 years ago Red Hat Linux was a platform that generated millions in revenues for the company, today Red Hat makes nothing from Fedora.

In response to a question from InternetNews.com, about whether Red Hat will change the model to make money from Fedora as they once did from Red Hat Linux, Cormier was dismissive.

He noted that RHEL has grown in capability over the last 10 years and that's directly attributable to the model. It's a model where the community for the free Fedora Linux serves as a proving ground for new technologies that eventually find their way upstream to Red Hat Enterprise Linux.

"So yeah that's the right model and now we have a similar model with JBoss, and I think we got it right and the plan is to continue," Cormier said.

While Cormier has no regrets about the move away from Red Hat Linux to RHEL, he does have regrets about how his company initially implemented virtualization.

"I wish we had more management for virtualization in initially," Cormier admitted. "By not doing that, it forced our customer base to go back to the proprietary model with hypervisors."

That said, Red Hat now has a full virtualization management offering integrated with RHEL, so users can migrate to an open source solution.

Another area where Red Hat is trailing its rivals is in commercial deployment of the OpenStack open source cloud platform. Rival vendor Ubuntu Linux has been supporting OpenStack for over a year, while Red Hat only officially embraced the platform this year.

"We're active in OpenStack and at some point OpenStack will make its way to our customer base," Cormier said. "We haven't decided in what form, but for now we're an active participant in an active and vibrant community."

Sean Michael Kerner is a senior editor at InternetNews.com, the news service of the IT Business Edge Network, the network for technology professionals Follow him on Twitter @TechJournalist.

This article was originally published on May 15, 2012
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