Will SCO Distribution Deal Placate Partners?

By Jacqueline Emigh  |  Posted 2005-04-19 Email Print this article Print

The SCO Group has been making big headlines with its Linux litigation. But does a new pact with supply-chain specialist Synnex mean SCO is shifting gears toward its original SCO Unix platform?

The SCO Group has finalized a contract naming supply-chain provider Synnex as a distributor, a deal seen by some as a sign that SCO is de-emphasizing its Linux legal woes by making a renewed commitment to the SCO Unix platform.

Since 2003, The SCO Group Inc. has been highly visible on industry radar screens for its bitter legal fight to win IP (intellectual property) rights and royalties around Linux.

But after dropping out of the Linux market once the battle had begun, the software vendor also has continued to sell products based on SCO Unix, its flagship Unix operating system for PCs, to SMBs (small and midsized businesses).

Click here to read about one judge's response to SCO's lawsuit against IBM.

In a partnership unveiled this week, Synnex Corp. joins Tech Data Corp. as one of two major distributors for SCO Unix in North America.

Under the deal, SCO UnixWare, SCOoffice Service, Reliant HA and other SCO Unix software products now will be sold through Synnex Canada Ltd., a Synnex subsidiary that recently bought Canadian-based hardware and software distributor EMJ Data System Ltd.

Some veteran reseller partners insist that despite SCO's longstanding legal disputes involving Linux, the vendor's support for SCO Unix never has wavered.

"SCO never really 'unfocused' on SCO Unix. It's just that the [ongoing] focus on SCO Unix hasn't been all that well-known," said Rene Baltran, director of sales and marketing at DTR Business Systems.

Baltran told The Channel Insider that he first heard about the deal between SCO and Synnex last summer, long before its announcement this week.

"It doesn't really impact us much. Synnex is in a different space from us. We provide value-added services," the SCO Unix reseller said.

But other SCO VARs are less certain about the software vendor's loyalty to SCO Unix, and some have given thought to leaving the SCO fold entirely, according to observers.

"The [original] SCO Unix product was more flexible and versatile than just about anything out there at the time [for PCs]. But lately, the SCO brand has become very, very 'radioactive,'" said Joe McKendrick, an analyst at Evans Data Corp.

"I'm sure that some of SCO's channel partners have become quite nervous over the past year and a half or so. SCO has kind of poisoned itself with all this litigation around Linux. Its image [with customers] has been hurt in the process. Some might even say that SCO has been selling its own dealers up the river," McKendrick told The Channel Insider.

Earlier this year, SCO was in danger of being delisted from the Nasdaq stock market. Click here to read more.

"Lots of [Linux competitors and customers] out there would be glad to see [SCO] fall off a cliff right now—or for it to turn into a 'penny stock,' at least," said Heather Stern, a principal at Starshine Technical Services, a technical and training consultancy for Linux administrators.

"Yet when people invest in a platform—whether it's SCO Unix, or Linux, or Macintosh—it's often hard for them to change. The platform becomes part of the fabric of the company," Stern said.

"Still, many [SCO Unix] partners must have gotten very close to being scared off over all of SCO's Linux shenanigans," Stern told The Channel Insider.

"But then, some people might see [partnership] news like this and say, 'Oh, SCO. They were having [legal] troubles before, but it looks like they're an OK company now.'"

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