September, 2008

Red Hat quarterly earnings up 29% to $164.4 million

Red Hat Inc. reported second-quarter revenues of $164.4 million, an increase of 29% in  quarterly revenue compared with a year ago, at $127.2 million. Deferred revenue rose somewhat faster, climbing 32% to $496.9 million. Quarterly profits also rose, but by a slimmer margin, rising 11% from $18.2 million for the second fiscal quarter of 2007 to $21.1 million for the second fiscal quarter of 2008.

The quarter’s revenues included two one-year sales of $5 million apiece.

Jim Whitehurst, the CEO of the Raleigh, N.C.-based company, said the higher-than-expected revenue growth was achieved against economic headwinds. The healthy earnings reflected strong renewals from the existing customer base, with old and new accounts alike responsive to an opportunity for cost savings, he said.

Sales of JBoss, Red Hat’s middleware product, grew twice as fast as those for Red Hat Enterprise Linux (RHEL), with rising sales as an embedded product to independent service vendors (ISVs) targeting the service-oriented architecture (SOA) market, Whitehurst said.

Red Hat’s recent $107 million purchase of Qumranet Inc. broadens its leadership in open source virtualization, which began with RHEL 5, continued with the Libvert virtualization layer and other tools to create a comprehensive virtualization portfolio, he said. Qumranet also gives Red Hat an entry into the early-stage virtual desktop market, he said.

CFO Charles Peters downplayed the potential adverse impact on future sales from the current turmoil in the financial sector. That vertical is now only 10% of the business, due to faster growing sales in government and telecommunications, he said. In addition, many of the financial customers are on multiyear contracts, he said.

Like RHEL, JBoss sales benefit from tighter economic times because corporations still need to deploy new functionality but have less money, Peters said.

Novell pledges to fix ZenWorks snafu

Sometimes stories about customer problems have happy endings.

One day after publication, the Novell ZenWorks problem that I blogged about Sept. 17 appears to be on its way to resolution. Not that resolution was speedy; the issue was the topic of numerous emails between the customer, Novell and TechTarget for three weeks.

Grant Nickle, IT director for Louisville, Ky.-based Underwriters Safety & Claims, told me in mid-August that ZenWorks 10, a configuration management application, had many improvements over its predecessor but contained a key flaw: It wouldn’t retain user identities and settings in the cache after a user signed off or was no longer on the network. The omission is critical for an IT department that manages hundreds of desktops because there is no other way to preserve user identities except through Microsoft Active Directory. Making matters worse, Nickle never got a promised call from tech support.

Yesterday afternoon, however, Nickle spoke directly with the product manager, who assured Nickle that the full functionality of the Dynamic Local User, which used to remember each user’s desktop settings and files, would be restored prior to Novell’s next Brainshare user conference in March. And Nickle has the product manager’s name and phone number to make sure he keeps his promise. In the meantime, Nickle will have to rely on ZenWorks 7, which doesn’t work with Microsoft Vista, but at least he knows he’s got a finite time to wait for a fix.

Actually, Nickle did Novell a favor by bringing a problem, which others in the user forum have complained about as well, to its attention. Kudos to Novell for recognizing and addressing the issue. Nevertheless, a nagging suspicion remains that it’s not as easy for an average user to bring a real problem to a software company’s attention as it should be. And that’s something all software companies should be striving aggressively to remedy. Just like nurses and physicians who need to be alert to minor symptoms of potentially major illnesses, there ought to be a way for software companies to flag a complaint that points to a serious problem and direct it out of normal channels to someone who can assess and remedy the issue. In the meantime, though, I’m celebrating Nickle’s victory. Novell listened and acted. And that’s a victory for us all.

Red Hat boosts open source at new CUNY lab, national campus tour

Red Hat Inc. is forging open source inroads in education these days.

For starters, the Raleigh, N.C.-based company teamed up with Intel Corp. to help equip the new New York City Open Source Solutions Lab on the City University of New York (CUNY) campus. With software donated by Red Hat and hardware by Intel, the new center will help the city and public agencies develop and test open source applications for municipal and state use.

In addition to government use, however, the lab also will be used to train students in working with open source software.

Ted Brown, executive director of the CUNY Institute for Software Design and Development, said that students need to learn how to work with open source software because open source is a large and growing trend.

Closer to Red Hat’s home base, Red Hat engineer Will Cohen is teaching a graduate course in free and open source (FOSS) software at North Carolina State University. Introduced last spring, the FOSS course enables students to join in ongoing projects of their choice and learn skills such as fixing bugs, testing software and adding new features as well as strengthening their project management and collaboration skills.

Promoting these higher education efforts is the Fedora Project Team, which conducted a three-week tour last spring, visiting 15 of the nation’s top universities to encourage use and instruction in open source software.

Jack Aboutboul, one of the tour participants, told Red Hat News that the faculty and students were very responsive to Fedora’s message about open source software.

“When you have the chance to fundamentally re-architect modern computer science education in the U.S. you take it,” he said. “The time is right to begin incorporating open source into both the campus environment and the curriculum.”

Novell ZenWorks 10 log-in snafu wipes out non-Microsoft desktops, IT director says

Sometimes the latest is not the greatest.

Just ask Grant Nickle, IT director at Louisville, Ky.-based Underwriters Safety & Claims. An avid fan of Waltham, Mass.-based Novell Inc., SUSE Linux Enterprise and ZenWorks configuration management software, Nickle was in for a big disappointment when he finally got around to testing ZenWorks 10, which he’d had for about a year while continuing to run version 7.

Nickle discovered to his dismay that in version 10, ZenWorks’ Dynamic Local User doesn’t cache or save individual desktop settings, files and icons when the machines are turned off or disconnected from the corporate network. Unlike version 7, the desktop and all its settings and data must be re-created with every startup, which is a big problem when your job is to create and manage user IDs for several hundred desktops.

“This is a big problem,” Nickle said. ZenWorks used to be a great work-around for managing users without Microsoft’s Active Directory because it managed Windows users as well as those running other operating systems. Now, ZenWorks is useless, he says.

Ironically, Novell is pitching ZenWorks 10 as a way to encourage businesses to migrate from Novell Netware to Linux, a move Nickle would be only too happy to make since he runs SUSE Enterprise Linux on his servers.

In an Aug. 28 e-mail, Novell responded that ZenWorks does address this problem. The company said that a user can simply leave a Novell eDirectory login credential on the machine to log in the next time without creating a new desktop. But Novell corrected the previous e-mail on Sept. 11, admitting that user caching is not available in the latest version but would be included in a subsequent version.

That’s small comfort to Nickle, who has no way to deal with the problem in the interim and no idea how many months it might be until the next update. Especially since ZenWorks had this working in version 7 and then removed it in version 10.

“We are stuck,” he wrote. “We can either look for another product to manage our desktops” or stay with version 7, but version 7 doesn’t support Windows Vista, he said. Nickle suspects that “somebody just made a mistake,” and noted that other users in the ZenWorks forum have voiced the same complaint with just as much frustration.

Sourcefire strengthens virtualization security with RNA

As attacks upon software systems become more sophisticated, it is crucial to adapt security measures to emerging threats. Virtualization is presently one of the most exciting technologies in the enterprise, but also among the most vulnerable.

At VMworld, Sourcefire, the security company that brought Snort to the market, has introduced a new product offering through its Sourcefire 3D. Most important, the release improves Real-time Network Awareness (RNA), a feature able to monitor both hardware and virtual environments.

First, RNA enables administrators to tailor the software to their compliance and policy requirements; the VM Detection feature combats the problem of VM sprawl by detecting all virtual machines and making them visible.

RNA is now supported by VMware’s support services, Technology Alliance Partner (TAP) program and VMsafe. VMsafe includes an application program interface (API), which enables other security applications to monitor for and catch intrusions that RNA cannot see.

RNA saves enterprise resources by identifying threats as they occur by continuously collecting information about virtual machine activity at the surface level of a virtual environment. Other security tools collect such data only during the day, allowing intruders greater opportunity to inflict harm on the system.

Red Hat stonewalls on Microsoft interoperability plans

Novell Inc.’s recent coup of achieving bidirectional virtualization with Microsoft’s Hyper-V — SUSE Linux Enterprise can run as a guest on Hyper-V and Hyper-V on SUSE — is a huge step forward for interoperability.

Novell’s accomplishment begs for a response from Raleigh, N.C.-based Red Hat Inc., the largest open source vendor, which, publicly at least, has remained totally aloof from Microsoft, which, like it or not, has an overwhelming share of the server market.

So what’s Red Hat’s reaction? Is it going to use the Linux Integration Components that Novell and Microsoft created to boost performance between Linux and Microsoft virtualization platforms? These drivers and accessories are freely downloadable from Microsoft’s website.

What about cross-platform certification? Is Red Hat going to pursue certification through the Microsoft Server Virtualization Validation Platform to optimize Windows’ performance as a guest on Red Hat Enterprise Linux?

Finally, what are the implications for interoperability of Red Hat’s focus on the KVM hypervisor while the rest of the computing world (except for Ubuntu) is centered on Xen? Although Red Hat has pledged support for Xen until at least 2014, the thrust of its development efforts will be on KVM. And what happens after 2013? These are reasonable questions to ask of the leading open source vendor. Yet these questions went totally unanswered from mid-afternoon last Thursday until the following Monday morning. The answer: There would be no response. Total stonewalling.

According to a recent ZDNet article, Paul Cormier, Red Hat’s president of products and technologies, told a London press conference that Microsoft’s Hyper-V is targeting VMware. But that’s not the issue! The issue is: Is Red Hat going to become a Linux-only solution or is it going to reach some sort of accommodation with Microsoft?

I would really like to see Red Hat continue to thrive and gain market share on the giant from Redmond, Wash. Kick butt, even. So I hope that the reason for Red Hat’s evasion is not because Red Hat’s avoiding the interoperability issue but because Red Hat is in negotiations with Microsoft and can’t say anything until they’ve reached an agreement.

Only time will tell.

Competitor Citrix releases cloud products at VMware’s VMworld 2008

Citrix Systems Inc. is hardly shy about its presence at VMworld 2008, an event hosted by its major competitor, VMware Inc. “Citrix is providing virtualization software customers with a choice where before the options were limited,” said Matt Fairbanks, Citrix VP of product marketing. Citrix will make two releases at the event this week. 

The first is XenServer 5, which acts as a platform for the second release, Citrix Cloud Center (C3). XenServer 5, or XenServer Cloud Edition, is an upgrade from previous versions of XenServer and will feature improved storage, disaster recovery, availability, performance and guest operating system support. It includes a feature called metadata tagging which identifies and categorizes individual virtual machines for easy virtual organization and management. It also offers expanded its application support to allow “hardware agnosticism,” said Fairbanks. 

Citrix Cloud Center is a family of products that works together with XenServer5 to help software service providers deliver applications to end users in a cloudlike infrastructure.  “Cloud computing is a new way of thinking about software,” said Fairbanks. “These products provide high-quality management and energy savings in the move to Web 2.0, 3.0, and Software as a Service.” Both products are part the Citrix Delivery Center line and are designed to help administrators run more servers on the same amount of hardware. Citrix Delivery Center includes as its core products XenServer, XenDesktop, XenApp and NetScaler.