Is Wal-Mart's Support for Suse Linux a Tipping Point?

Microsoft (Nasdaq: MSFT) and Novell (Nasdaq: NOVL) are proudly announcing the biggest proof-point to date that their groundbreaking alliance to work together for the benefit of their customers has real traction: Wal-Mart (NYSE: WMT), the world's largest retailer, is gearing up to take advantage of Microsoft and Novell's collaboration and interoperability efforts between Microsoft Windows and Linux.

Under the terms of the agreement, Microsoft will deliver Suse Linux Enterprise Server subscription certificates to Wal-Mart for use in its IT infrastructure. The entire deal only recently became possible due to Microsoft and Novell's November 2, 2006, agreement to collaborate on Windows and Linux interoperability.

Complicating Factors

Wal-Mart currently uses Microsoft products, as well as Linux solutions from Novell's market-leading rival, Red Hat (NYSE: RHT).

The collaboration with Microsoft and Novell will allow Wal-Mart to manage Windows and Linux by extending its existing Microsoft management tool set and authentication platform: Systems Management Server, Active Directory, and Microsoft Operations Manager.

However, the retailer also cited concerns over intellectual property assurance -- namely the potential for a lawsuit over Microsoft's claims that Linux violates its patents -- and noted that the decision to work with Microsoft and Novell provides the IP assurance Wal-Mart also expects.

Moving Past the Patent Fuss

"I think when you put aside the fuss around the patent, technical, legal and philosophical issues -- just looking at this from a business perspective -- there was a lot of skepticism around the time of the announcement if there was anything to the agreement," Michael Goulde, a senior analyst for Forrest Research, told LinuxInsider.

"This would not have happened had it not been for recognition on the part of Microsoft that customers wanted them to shift their position. ... Microsoft is now more positively disposed to being responsive to what customers are actually trying to accomplish," he observed.

Wal-Mart's decision to use Suse Linux over Red Hat points out that there are more customers with mixed environments that really do want Microsoft to help them interoperate with non-Microsoft solutions.

More than 90 percent of respondents to a survey that Microsoft released in early December favored vendor cooperation and interoperability. While that finding wasn't surprising, Microsoft also reported that more than two-thirds of all respondents -- and 79 percent of respondents who already used Red Hat -- said the agreement was more likely to make them choose Suse Linux for their datacenter.

Is Wal-Mart the Tipping Point?

Because Wal-Mart is such a high-profile customer , might the retailer's decision fuel new enterprise adoption of Suse Linux?

"I think it's something that other customers will look at closely," Goulde said. "It's a big step in the right direction, but there has to be some outcome. Wal-Mart has to be willing to say in six months or a year that it worked out great. Such an announcement from Wal-Mart -- or another customer -- would go a long way."

In other words, the end result has to be successful before many other enterprises actually follow suit, noted Goulde.

Red Hat, by the way, appears to be taking the announcement in stride:

"As Red Hat demonstrates growth around the world and across industries, the competitive landscape continues to be lively," Leigh Day, a spokesperson for Red Hat, told LinuxInsider.

"We expect to compete," Day added. "Customers should be wary of solutions that might seem attractive near term, but have questionable long term prospects."