“Far from another overhyped Linux stock, VA has a distinct
edge. It actually sells something.“
“As if the craze for Internet initial public offerings weren’t
enough, Wall Street has gone gaga for companies that support the
variation of Unix operating system software called Linux. It
started with the August IPO of Red Hat (RHAT), whose stock has
since advanced 480%. That provided enough momentum for a company
such as Cobalt Networks (COBT), which has a tenuous connection to
Linux, to jump nearly 50% on its first day of trading, on Oct.
9.”
“Despite the endless optimism of stock hypesters, most Linux
companies have a big flaw: The software on which they base their
businesses is nonproprietary and, most troubling, free.
Technically, it’s owned in part by any developer who has added a
wrinkle to it and then, as a condition of getting the software for
free, has posted the changes on the Internet. Linux will thus be an
eternally evolving operating system that’s essentially in the
public domain. A well-managed company can probably figure out how
to make money by selling Linux services and support, but no one has
ever earned much doing that, which makes owning shares in Linux
companies risky.”