Corel Signs Linux OEM Agreement With PC Chips

Software vendor Corel Corp. (Nasdaq: CORL) has entered into a strategic OEM alliance with PC Chips to help build a customer base for its new distribution of the Linux operating system (OS).

Under the terms of the agreement, companies in the PC Chips group will bundle Corel LINUX with computer motherboard packages shipped to the U.S., Canada and internationally. The deal, which also covers Corel’s WordPerfect 8 for Linux word-processing product, marks the Ottawa, Canada-based company’s first Linux OEM alliance, and sets the stage for the official Corel LINUX debut at COMDEX in Las Vegas later this month.

Boost For Traditional Retail And E-Commerce Sales of Linux

“PC Chips is one of the world’s largest suppliers to the PC desktop market, which makes this bundle a great fit for our Linux initiative,” commented Dr. Michael Cowpland, Corel president and CEO. “Now, users around the world will be able to experience first-hand the super reliability, easy installation and many other benefits of Corel LINUX.”

The two companies will also work on a joint marketing campaign, focusing upon Corel’s official Web site, and bringing added-value services to users of both Corel software and PC Chips hardware products. Corel LINUX and WordPerfect 8 for Linux will be distributed to PC Chips customers through a jointly labeled CD.

“Corel’s efforts in building an easy-to-use Linux OS and porting its world-class applications over to Linux make it a major player in this new market,” observed Johnson Yang, PC Chips chairman. “This alliance gives us the opportunity to provide customers with a Linux OS that is easy to install and simple for all users to adapt to.”

With more than 15 million motherboard shipments in 1998, PC Chips estimates that a number close to 20 million motherboards and white box units will be shipped in 2000. The deal could help to push the open-source OS further into an already expansive market for Linux-based solutions, increasing product sales at traditional retail outlets and through e-commerce Web sites.

Debian: A Solid Foundation

The Corel LINUX distribution is seen by some industry analysts as a serious challenge to mainstream Linux vendors. Based upon the Debian GNU distribution that has gained universal respect, Corel’s OS package will carry some 1,440 open-source software programs and the collective creative support of an army of international volunteer developers that make up the Debian Project.

Corel’s road to becoming a Linux vendor has not been met with universal fanfare, however. The company experienced some light public flogging when it began beta-testing its OS. Members of the pen-source community, including guru Eric Raymond, accused Corel of violating the GNU Public License (GPL) and of stealing open-source code.

The agreement that accompanies Corel’s beta states that “all right, title and interest to all intellectual property with respect to the products shall remain with Corel and its licensors.” The company has commented that the agreement will only apply to the beta version and will be dropped when the product ships.

Debian is not exclusively relying on Corel to bring its distribution of Linux to a larger market. The Debian Project recently garnered backing from recent IPO entry VA Linux Systems, O’Reilly Associates, and SGI, Inc.

The sponsorship, along with Corel’s redistribution, will bring the famous “non-commercial” software to a new commercial arena.

About Linux

Linux is a freely distributed OS, based on UNIX, which was created in 1991 as an alternative to Windows. International Data Corp. (IDC) numbers indicate that Linux grew more than 212 percent and captured more than 17 percent of all server OS shipments in 1998. More than 12 million end users and organizations now use Linux technologies worldwide.