Collax Gears Up for North American Linux Launch

Published: August 1, 2006

by Timothy Prickett Morgan

Years of consolidation in the commercial Linux distribution business and a proliferation of Linux vendors who are playing Linux from many different angles, might make you think that the market was saturated with distributors and that there was not a lot of room for new ones to enter. Not so, says Olaf Jacobi, chief executive officer of Collax, who is packing his bags to move from Germany to Boston as the company gets ready to take Linux to the SMB space.

Like a number of other Linux vendors before it, Collax is trying to make Linux easier to use and to package it in forms that are best suited to small businesses. Jacobi doesn't like Collax being compared to Red Hat, which he sees as a Linux distributor with products aimed at the Global 2000 companies. Such enterprises have just about every kind of computer known to man, and they have a wide variety of skills and big budgets. Small businesses want an integrated, easy-to-use server platform, and with Collax Business Server, that is what Collax aims to give them.

Collax was founded in May 2005 by Jacobi, who has managed a number of European startups, and Boris Nalbach, who used to be chief technology officer at SUSE Linux before Novell acquired it in 2003 and who was vice president of open source strategy in EMEA for Novell after the acquisition. Nalbach is now CTO at Collax, and the company has moved from Germany to the Route 128 corridor outside Boston in the city of Bedford, Massachusetts. William Hite, who is the chief financial officer at Collax, has worked at a number of big high-tech companies that went public, including ON Technology, a Boston-area company that specialized in management software for PCs and servers that was acquired by Symantec in October 2003 for $100 million. And, just to set the tongues wagging, Richard Seibt, who used to be CEO at SUSE Linux before it was acquired, who was for a short period president of Novell's EMEA unit, and who left Novell in May 2005, is an investor in Collax. Paula Hunter, who ran the UnitedLinux collaboration effort between SUSE, Caldera Systems (which is now SCO Group and not a Linux player, but a Linux antagonist), and Turbolinux), who had various technical and marketing positions at Digital and Compaq, and who was most recently marketing and business director for Open Source Development Labs, was at the end of May named vice president of marketing for North America at Collax. In February, Intel Capital, Atlas Venture Partners, and Wellington Partners kicked in $8.4 million in Series A venture capital funding, which is earmarked for the company's North American launch. That launch could happen as early as LinuxWorld in mid-August in San Francisco, or it could happen in September; the schedule has not been finalized yet, says Jacobi. And finally, Fujitsu-Siemens, which rules the X86 and X64 market in Germany and in other areas in Europe, a month ago signed up Collax to be a solutions alliance partner, which means Collax has been given official recognition by a major server vendor.

As far as I know, they don't say this popular American phrase in Germany, but it is funny to think that German Linux enthusiasts--especially those who loved SUSE and who are probably cheering on Collax because they don't necessarily like what Novell did when it acquired SUSE--might adopt this badly translated motto anyway: Rückzahlung ist ein Weiblicher Hund.

Today, Collax has 33 employees and has over 8,000 commercial installations in Europe of its Collax Business Server. The company estimates it has twice as many freebie installations, which seeds the market for future paying customers. The way Jacobi sees it, Red Hat is really aimed at companies with many hundreds to several thousands of users. The entire suite of products is suited for large enterprises with lots of seats and big budgets. While Novell's SUSE Linux can, in his estimation, be suitable for smaller companies and SUSE can scale to bigger iron, just like Red Hat's distro can, Novell's sweet spot is when companies have several hundred users and the skill level of administrators needs to be high even in smaller shops. Collax wants to chase companies with between 20 and 250 users, and companies that do not want to necessarily graft on Windows-like interfaces and tools to manage their Linux servers. (This is an approach that Xandros is taking with its Xandros Server variant of Debian and Lycoris, now part of Mandriva, took with its desktop variant.)

Collax Business Server has been on sale in Europe for a year, and it is available for free for up to five users. Earlier this year, Collax switched to the Linux 2.6 kernel; its initial products were based on the Linux 2.4 kernel. The company has also worked with Frank Holbert, who created the OpenExchange groupware for SUSE back in the SLES 8 days and which SUSE sold as SUSE Linux OpenExchange Server, to create a variant of Collax Linux called, appropriately enough, Collax Open-Exchange Server. And last week, in Germany, the company launched the Collax Security Gateway, which is a unified firewall, intrusion detection system, and spam filter that costs 296 euros for 10 users and 1,343 euros for 100 users; it also comes in a hardware appliance form for 937 euros. While is the other neat thing about Collax. All of its software comes in appliance form, scaling from 20 to 1,600 users. Collax Business Server costs 395 euros for 10 users.

Pricing has not been set for the products yet in U.S. dollars, but obviously will be set when Collax does its North American launch within the next month or so. Jacobi says that while it is natural enough to compare Collax to Red Hat, the company's approach is much more aligned with that of Microsoft in terms of being a channel-driven company. "Red Hat is really addressing the Global 2000, and its product is really based on complexity," he explains. "We have simplified Linux servers, and that is what makes us a Linux alternative to Windows. But to say that we are rivals to Microsoft and its Windows--as some have suggested--is a bit overdone. Our biggest successes in Europe, in fact, are with Microsoft partners who want to sell Linux." Jacobi bristles less about comparisons to Xandros, which has more or less created a Windows veneer for Debian Linux. "I really like the company, and I think it is good to have competitors," he says. "If Collax was alone, it would be a much tougher job competing against Microsoft." He says that Collax is focusing less on Windows-alike technology than Xandros and is unabashedly using best-of-breed open source tools on top of Linux to make turnkey software or appliances for companies who want to deploy Linux with little skills. And, Collax is counting on building up a large value-added reseller and system integration channel, aimed specifically at the small and medium business where Microsoft is so successful, to get its slice of the platform pie. "Xandros and Collax have the same target customers, but we have different approaches."