SAN FRANCISCO (02/18/2000) - Lineo Inc., a U.S. firm that offers an embedded version of the Linux operating system, is taking its first steps to ally with Asian Net appliance vendors as part of the company's strategy to expand internationally and speed adoption of its Embedix OS .
Lineo Wednesday signed partnerships with six Taiwanese embedded system manufacturers and is set to announce Monday similar relationships with Korean OEMs (original equipment manufacturers), Lineo spokeswoman Jennifer Finlinson confirmed in a phone interview yesterday.
The market for Internet appliances is particularly hot in Asia. Some countries there have low PC penetration rates, and the easiest way of rapidly boosting the number of people who can access the Internet is by offering consumers Internet appliances which are typically easier to use and more affordable.
The six Taiwanese vendors -- Arima Computer Corp., Compal Electronics Inc., First International Computer Inc. (FIC), Micro-Star International, Mitac International Corp. and Wisecom -- have adopted Lineo's Embedix OS for use in their embedded Internet appliances, Finlinson said. One notable omission from the list of vendors is Acer Group, which unveiled its Internet appliances in November of last year at the Comdex/Fall show in Las Vegas. [See "COMDEX: Acer Debuts 'Net Appliances," Nov. 16, 1999.]Lineo Chief Executive Officer Bryan Sparks said in a telephone comment yesterday that the Taiwanese partnerships offer his company a way of putting its products "into channels which otherwise would have taken us months or years to develop." He added that partnering with Taiwanese manufacturers is very important, given that they are well-known as producers of embedded hardware, with their products shipping around the world.
The Linux OS company also plans to expand its sales office in Taipei by adding a development and testing center to the operation, Finlinson said. As yet, the company isn't commenting on its business plans for China, where Microsoft Corp. made a splash last year announcing plans for its Venus computers. These devices are expected to allow the software giant and its hardware partners to target the millions of Chinese users who are unable to afford computers, but are keen to hook up to the Internet using Net appliances. Further details about Venus have yet to emerge.
Lineo is in the middle of expanding its operations, having announced its intention to purchase real-time Linux solutions provider Zentropix at the start of this month. That acquisition will give Lineo Linux development centers in Herndon, Virginia, and in the U.K., in addition to its Utah office, Finlinson said. The company is likely to make further acquisitions to net it more Linux development centers, especially outside of the U.S., she added.
On March 1, Lineo will officially open a Seattle development center -- which it also gained through the Zentropix purchase -- where it will continue to work on developing Embedix PDA, a layer to its OS that will allow users with Microsoft Windows CE applications to run on Embedix, Finlinson said. Embedix PDA is due to be released during the first quarter of next year.
As well as developing and selling embedded Linux operating system and application software, Lineo is the owner of the DR-DOS operating system.
Caldera Inc., Lineo's parent company, reached an out-of-court settlement with Microsoft Corp. last month related to a long-standing antitrust complaint.
Caldera had been looking for US$1.6 billion in damages from the lawsuit, which it filed against Microsoft in 1996, alleging that the software giant had abused its dominant position in the operating system market, thus stifling the chances of DR-DOS being able to compete against Microsoft's operating system, MS-DOS.
Specific details concerning the settlement remain confidential, but Microsoft did announce that it would take a one-time charge of about 3 cents per share in its second quarter earnings for the period ended Dec 31, 1999. Analysts have speculated that the amount of money Caldera received from Microsoft is between $250 million and $275 million, but neither party will comment on the exact figure. [See "UPDATE: Microsoft Reports Strong Q2 Revenue," Jan. 18.]Lineo was formerly known as Caldera Thin Clients Inc.
Lineo, based in Lindon, Utah, can be reached at +1-801-426-5001 or via the Internet at http://www.lineo.com/.