Microsoft Puts Squeeze on Open Systems

P> When one thinks of open systems, UNIX springs to mind. Yet many are saying this resilient operating system, which runs much of the complex electronic plumbing behind the Internet and in corporate America, may become the Latin of the computer world.

"1996 is going to be the year of NT," said Jim Garden, director of syndicated services at Technology Business Research Inc., a Hampton, N.H.-based market research firm that follows open, client/server and computing platforms. "NT is easier to use, and it has a better interface. If you can buy a fast sports car, why would you buy a beat-up truck?"

This year, Microsoft will ship 1.5 million copies of NT, compared with "less than a million" for UNIX, Garden said. So UNIX is moribund? "Yeah," then Garden pauses, "with small exceptions in the high-end server area. So it's going to become a niche product. They'll sacrifice the volume space to 'Wintel' -- the combination of Intel and Microsoft."

Reports Greatly Exaggerated

Windows NT has been around for five years; UNIX is decades old -- eons in the computer age. Legacies don't drop dead the moment muscled barbarians ride into the Eternal City.

Certainly, they're not listening to the UNIX death dirge at The Santa Cruz Operation Inc., Santa Cruz, Calif. They're laughing at it. They'll be laughing hardest -- and to the bank -- if those who report the death of UNIX are greatly exaggerating.

SCO, the world's leading supplier of UNIX server and host systems, bought UNIX -- whole -- from Novell Inc. late last year. This year, SCO started consolidating the various flavors of UNIX -- a consolidation that's been tried before. Now, with Windows NT cutting away market share, the push to blend the many flavors of UNIX into SCO's UNIXWare may be a necessity of survival.

Mike Shelton, vice president of enterprise solutions for SCO and the man who led the UNIX purchase, makes a strong case for the survival of UNIX. "I don't think the death of UNIX is going to happen. I don't think this will even result in a case of NT shipping more than UNIX. The impact that NT will have on the server market [will be to] make the server market more of a commodity market."

Then Shelton took a deep breath and tapped the bottom line: "Companies will always buy to meet their business needs. UNIX is extremely good at integrating with legacy systems. UNIX is here to stay."

Consider, too, that UNIX, running on servers from companies such as Sun Microsystems Inc., Mountain View, Calif., is the operating system for the Internet. The Internet itself is the biggest open system in the world: A totally interoperable, if sporadically seamless, network of 35 million people united by an obscure, government-invented protocol known as Transmission Control Protocol/Interconnect Protocol. Who says government can't initiate important commercial advances? Even Microsoft has had to reposition itself as an Internet-compatible company -- with companies such as Sun Microsystems now being crowned as the new forces to be reckoned with in the computing world.

This largely unexpected turn of events suggests Microsoft's days of bullying customers into rejecting open systems may be over. If so, then a company such as SCO may have much better long-term prospects than many believe. It may be no coincidence that Bill Gates was himself an early investor in SCO.

Speaking from his Santa Cruz office, Shelton predicted that a one-flavor UNIX in the vision of SCO would anesthetize the operating system from Microsoft's hard charge. In SCO's scenario, Windows NT will be a player in the server market. However, the sheer mass of an open, portable UNIX -- at a lower cost -- would contain Microsoft's market share.

Shelton sees legacy-compatibility as vital. "If you look at where NT is, they're really selling to different markets," he said. "These are Intel clients already under Windows."

Still, Shelton was forthcoming about the true nature of the fight he faces. "NT is clearly going to be important. It is a threat. Where they threaten most is with the Web server business. Over time, they'll become more of an applications server. The important thing for the marketplace is that there are choices. There will be two main server operating systems: UNIX and NT."

The end game between the two operating systems should lower prices. "We look at the rise of NT as an opportunity," said Shelton. "It creates heat in the market and shakes out the little players. The cost of server-based software will go down."

SCO has a three-part strategy to unify UNIX and present a single front against NT. Shelton said SCO plans to move 5.4 base UNIX to UNIXWare. That's the first step. The second step is to provide all the technology SCO has added to UNIX. The final -- and probably hardest step -- is to then "persuade software vendors to conform to that platform."

Shelton said "Gemini" is the code name for a new SCO UNIXWare release planned for 1997. The year after that, said Shelton, SCO will release another one-flavor UNIX, code-named "Summit 3d."

"Summit 3d is a joint development with SCO and [Hewlett-Packard] to develop an entirely new architecture by 1998," said Shelton. "The biggest challenge is things are moving so quickly."

Future consolidation is nice and overdue, but the trump card SCO uses today when selling the various flavors of UNIX is its reliability. "UNIX is a high-performance system that never fails," said Shelton. "NT is not something people will chance their business to today. The attraction of an NT server is the familiarity they have with Windows. That's also the downside because Windows is not designed to be as reliable a server as UNIX."

Many agree with that assessment, though the issue itself may be moot. "NT is getting ready for the big-time," said Hill Carter, senior consultant at Digital Equipment Corp.'s Federal Government Region in Greenbelt, Md. Digital has developed a close alliance with Microsoft's NT operations to build demand for its powerful Alpha workstation. Now, the government has formally declared NT compliant with the POSIX operating system, upholding a $188 million contract from the U.S. Coast Guard for workstations running NT. That paves the way for NT to be purchased and bid as an open system on billions of dollars worth of other federal contracts. But Carter cautioned, "It's certainly an excellent departmental operating system, but it's not fully ready for the mission-critical applications, things like bet-your-business applications. If you were an airline you wouldn't put your reservation system on NT. UNIX has a better reliability."