Former MP3.com CEO Michael Robertson recently escaped his scrape with the major music labels over digital distribution, and now he's up for his next challenge: wresting control on the operating system market from the grip of Microsoft.
Robertson believes his new company, Lindows.com, can do just that by offering something no operating system has successfully done before. For $99, users can download LindowsOS, a system that enables users to run either Microsoft or Linux applications on their PC.
In contrast, on Thursday Microsoft rolls out its new operating system -- Windows XP -- which retails for $300 and comes packed with several controversial rights-management systems that restrict how users can interact with digital media.
"We think it's the perfect time to launch an operating system," said Robertson. "Microsoft software is getting more expensive, which seems to defy the logic of the market. Its licensing terms are also way more constrictive than they used to be."
Linux is an open-source code that is freely available and can be modified by anyone in the world. The only stipulation is that engineers return the code to the public.
Because it is constantly being tweaked by developers, Linux offers more flexibility with the programs and applications. While there is no customer service line, per se, to call if a system crashes, message board and chat rooms are always up and running.
That's different than Microsoft's XP, which comes embedded with products and applications that can't be readily modified.
As he has done in the past with music, Robertson is banking that consumers would trade off some customer convenience for more flexibility.
The Linux community is still taking a wait-and-see approach, since the public beta of the new software won't be available for another two months. On technology message board Slashdot, hundreds of messages were posted about the project.
"I'd have to say, I'm a bit suspicious about this," wrote DeanJ. "The website seems pretty bare."
One overwhelming concern was over Robertson's desire to make the source code his company develops available to the open-source community.
Even if Lindows.com wins over reluctant skeptics, who desperately want any alternative to Microsoft and its 85 percent OS penetration, Robertson's new startup faces an uphill battle.
Several companies have tried -- and failed -- to build a profitable business using the Linux OS. Within the past year, Lineo, EBIZ and VA Linux have faced massive staff cuts and corporate reorganizations.
But Robertson and his small investment team -- all original employees of MP3.com -- have been battle tested. In January 2000, MP3.com was sued by the five major record labels.
The suits were settled for $140 million and MP3.com was soon purchased by the Vivendi Universal, the parent company of one of the labels.
While it seems a stretch -- jumping from digital music to developing an operating system -- Lindows.com is an extension of the MP3.com vision.
Like the digital music company, Robertson hopes to use digital downloads and open standards to capture his audience.
Robertson is banking that his new Linux-based operating system will make it to mainstream businesses across the country in the same way that music consumers flocked to the MP3 music format.
Millions of online users store, listen and trade music files on the Internet despite the recording industry's attempts to halt the use of MP3 files.
Today, the popular format plays on most PC-based and portable music players because it comes with no digital rights management that can restrict how -- and when -- a file is played.
Operating systems work the same way. For many, Linux is more flexible, although it's a bit more difficult to use for first-time computer users.
Microsoft's operating systems require users to load software from a CD-ROM onto their computer. Then, they need to input a series of pass codes and serial numbers to complete the installation. For small companies, keeping track of all those numbers can be a hassle.
By offering an easy download and a quick four-step installation process that gives companies the ability to use Microsoft or Linux applications, Robertson believes he combines Linux flexibility with Microsoft's ease-of-use.
"I'm betting on a trend I'm positive is going to happen," Robertson said. "If people are content with the operating system they have, we'll fail. If people who want an alternative to other companies (are) out there, then we'll be able to create a nice business."
