InfoWorld: Linux has established itself on the server. What progress is being made with Linux on the desktop?
Zemlin: It's an interesting year for Linux on the desktop. We are starting to see some of the major levers of platform adoption for desktop computing be pulled more dramatically this year than they ever have. If you think about what makes a desktop platform successful, the fact that Windows comes pre-installed on most computers when they're purchased on the marketplace obviously [is a] big advantage. And you're starting to see companies do the same with Linux. You're starting to see companies like Asus and their Eee PC. It's a small subnotebook that costs, I think, less than US$400. It comes pre-installed with the Linux platform, and it really enables them to target a whole new demographic that they've never been able to effectively sell into before, you know, in Asia, women over 30, or people who could never afford a US$600 to US$1,000 PC. And you're seeing those offerings now being replicated from Everex with their CloudBook product. Lenovo is now shipping Linux on its X series line of products. You're starting to see for the first time...Dell announced last year that they are shipping pre-installed Ubuntu Linux specifically, on their notebooks.
So you're starting to see OEMs pre-ship Linux for the first time, which is interesting, but if you look kind of underneath that, the more interesting picture is -- why are they doing that? What is compelling them? Is it because Linux is more functional than it's ever been? The answer there is yes, it is more functional. But that functionality combined with the economics of the situation, where if you think about the bill of materials for a PC, [if] you've got Microsoft in there, I think the OEM [cost] is somewhere between US$50 to US$75 to license Windows. On a US$300-400 PC you're talking 30-40 per cent of the price of the computer, which is a significant amount of money. So not only is it one of the largest components of the actual PC, but it's the highest margin component, right? If you look at the stock market, you can see Microsoft has about a 30 per cent net profit. You've got Intel making like 15 per cent profit margins. Then you've got Dell at like 5 per cent. And so when companies like Dell or Asus or Lenovo or all these companies look at those profit margins, they say, "Why wouldn't I just create my own operating system and ship it with the device? I'm therefore higher up the food chain with a higher margin product on a lower priced PC that I can use to penetrate larger markets."