By John E. Burke, Principal Research Analyst, January 26, 2007.

Oracle (NASDAQ:ORCL) this week released the Oracle Management Pack for Linux, deepening its commitment to Linux not just as a supported platform but as a business line, applying further competitive pressure to Linux leader Red Hat (NYSE:RHT), and further raising Linux’s profile as a supported platform in the enterprise.

Oracle’s new offering will increase pressure on RedHat’s revenues, and will bolster Oracle’s Linux business. The real significance, though, is not in competition but cultivation. Oracle is significantly strengthening the overall Linux systems management market, both directly with its offering and through competitive pressure on leaders Novell (NASDAQ:NOVL) and RedHat. This, on top of pushing RedHat to lower its prices by offering a clone of RedHat Enterprise Linux (RHEL) and support for both original and clone, will increase the chances of enterprises deploying supported Linux servers for Oracle software. The primary benefit to Oracle of the entire Unbreakable Linux initiative is this cultivation of broader and deeper creation and/or maintenance of non-Microsoft (NASDAQ:MSFT) landscapes in the datacenter.

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