Can Red Hat win the Web for AOL?

Web services are the future. Talk to Gartner and its analysts will tell you that next year profits from Web services will race...

Web services are the future. Talk to Gartner and its analysts will tell you that next year profits from Web services will race past conventional software. By the end of 2002, 80% of companies developing software will support Web services architectures which, of course, means XML and Soap and lots of noise about Microsoft .net. But ask people what they think these services are and it is surprising how different the replies can be.

Ideally, Web services conjure up a world where component applications can be stitched together on demand. Big companies such as Boeing are already doing this to link many different enterprise applications through a browser. Aramco, one of Boeing's customers, which has one million items in its catalogue, is just rolling out mySAP.

If that sounds vague, then imagine that one day in the future you may want a spreadsheet program that can handle inventory management and track new orders. Each one might exist as a separate Web service that can be located, stitched together, delivered and paid for, on demand, by a service such as the Microsoft Network (MSN).

Unhappy with the results of the US Government's antitrust case against Microsoft, Netscape - or should we say AOL? - is to sue for damages. At the same time, there was a rumour that AOL Time Warner was looking hungrily at Linux distributor Red Hat.

There is a tenuous link between the two because AOL is clearly worried about Microsoft's ambitions for Windows XP and the future of Web services in what remains a largely Microsoft world.

Windows XP has hooks into a whole nest of services that conveniently link back into MSN but AOL smells another monopoly in the making. Connect Windows XP to the network and it is increasingly difficult to work out where "my computer" begins or ends. Are "my network places" or "my applications" on the same continent any more? And is this my software or is it really Microsoft's and I simply rent the privilege of using it?

Worried that in time Windows XP and Microsoft's plans for component pay-per-view Web services could ring-fence it out of the market, AOL needs a cunning plan.

It has content - courtesy of Time Warner - but no real applications firepower outside Netscape which, of course, can run on Linux. So the thinking goes, '"Why not buy the means of developing services independent of Windows?" After all, on a futuristic Linux device with Netscape as the browser, who needs Microsoft?

That is the myth. The reality is that most of us believe that we do need it and there is a shortage of volunteers ready to surrender Windows and replace it with the joys of installing one of the several flavours of Linux.

But AOL is not a software company and its flirtation with Sun and the Netscape brand does not inspire confidence in the argument that by adding the Red Hat brand and its consulting services the company could, as if by magic, re-invent itself as an applications development powerhouse fast enough to keep pace with Microsoft's Web services plans.

Hands up everyone who believes AOL can take on Microsoft? I rest my case.

Simon Moores is chairman of the Research Group

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