Red Hat's 30th Anniversary: How a Microsoft Competitor Rose from an Apartment-Based Startup

For Red Hat's 30th anniversary, North Carolina's News & Observer newspaper ran a special four-part series of articles. In the first article Red Hat co-founder Bob Young remembers Red Hat's first big breakthrough: winning InfoWorld's "OS of the Year" award in 1998 - at a time when Microsoft's Windows controlled 85% of the market."How is that possible," Young said, "that one of the world's biggest technology companies, on this strategically critical product, loses the product of the year to a company with 50 employees in the tobacco fields of North Carolina?" The answer, he would tell the many reporters who suddenly wanted to learn about his upstart company, strikes at "the beauty" of open-source software. "Our engineering team is an order of magnitude bigger than Microsoft's engineering team on Windows, and I don't really care how many people they have," Young would say. "Like they may have thousands of the smartest operating system engineers that they could scour the planet for, and we had 10,000 engineers by comparison...." Young was a 40-year-old Canadian computer equipment salesperson with a software catalog when he noticed what Marc Ewing was doing. [Ewing was a recent college graduate bored with his two-month job at IBM, selling customized Linux as a side hustle.] It's pretty primitive, but it's going in the right direction, Young thought. He began reselling Ewing's Red Hat product. Eventually, he called Ewing, and the two met at a tech conference in New York City. "I needed a product, and Marc needed some marketing help," said Young, who was living in Connecticut at the time. "So we put our two little businesses together." Red Hat incorporated in March 1993, with the earliest employees operating the nascent business out of Ewing's Durham apartment. Eventually, the landlord discovered what they were doing and kicked them out. The four articles capture the highlights. ("A visual effects group used its Linux 4.1 to design parts of the 1997 film Titanic.") And it doesn't leave out Red Hat's skirmishes with Microsoft. ("Microsoft was owned by the richest person in the world. Red Hat engineers were still linking servers together with extension cords. ") "We were changing the industry and a lot of companies were mad at us," says Michael Ferris, Red Hat's VP of corporate development/strategy. Soon there were corporate partnerships with Netscape, Intel, Hewlett-Packard, Compaq, Dell, and IBM - and when Red Hat finally goes public in 1999, its stock sees the eighth-largest first-day gain in Wall Street history, rising in value in days to over $7 billion and "making overnight millionaires of its earliest employees." But there's also inspiring details like the quote painted on the wall of Red Hat's headquarters in Durham: "Every revolution was first a thought in one man's mind; and when the same thought occurs to another man, it is the key to that era..." It's fun to see the story told by a local newspaper, with subheadings like "It started with a student from Finland" and "Red Hat takes on the Microsoft Goliath." Something I'd never thought of. 2001's 9/11 terrorist attack on the World Trade Center "destroyed the principal data centers of many Wall Street investment banks, which were housed in the twin towers. With their computers wiped out, financial institutions had to choose whether to rebuild with standard proprietary software or the emergent open source. Many picked the latter." And by the mid-2000s, "Red Hat was the world's largest provider of Linux...' according to part two of the series. "Soon, Red Hat was servicing more than 90% of Fortune 500 companies." By then, even the most vehement former critics were amenable to Red Hat's kind of software. Microsoft had begun to integrate open source into its core operations. "Microsoft was on the wrong side of history when open source exploded at the beginning of the century, and I can say that about me personally," Microsoft President Brad Smith later said. In the 2010s, "open source has won" became a popular tagline among programmers. After years of fighting for legitimacy, former Red Hat executives said victory felt good. "There was never gloating," Tiemann said. "But there was always pride." In 2017 Red Hat's CEO answered questions from Slashdot's readers.

Read more of this story at Slashdot.