By the mid-1990s Linux was nearly a household name.  The economy was already booming from the .com explosion and the prospect of a free operating system (OS) available to all for modification and customization added fuel to the fire.  For companies that had long paid expensive licensing fees, Linux was a free alternative.

With the Web gaining popularity Web servers were an expense for Internet service providers as well as corporations.  The Apache Project, an open source Web server designed to run on Linux, made for an inexpensive vehicle to bring content online.  Apache created one of the first real world, widespread and tangible uses for Linux. Today Apache has nearly 70 percent of the Web server market.

Seeing the need for commercial support for Linux, various Linux-based startups began offering their own modified versions of Linux.  Their business model was not to profit from the sale of the software but from the surrounding corporate service and support, including custom engineering. 

Perhaps the best-known Linux support company is North Carolina based Red Hat.  Red Hat leaped onto the Linux scene in 1995 with the release of its own Linux distribution.  By 1998 Microsoft introduced Red Hat’s product into evidence during federal hearings as part of Microsoft’s defense against charges that it had impermissively monopolized the computer operating system market.  By 2003 there were one million registered Red Hat Linux users.

Another major player in Linux has been around for much longer.  IBM gained fame early on as the inventor of the personal computer (PC).  However by the 1990s Big Blue had seen better days.  Having lost ground in the software market to Microsoft and in the hardware market to competitors like Dell and Compaq, IBM turned to Linux.

For IBM, Linux provided a cost-effective solution to approach potential large market clients such as foreign governments and large private and public institutions. IBM combined the already widespread adoption and compatibility of Linux with the legacy of its own reputation to sell large-scale corporate solutions.

In the past IBM had based its products on its own proprietary flavor of Unix called AIX.  Currently the company is offering both AIX and Linux platforms, however the ease of integration and lower bottom line makes Linux solutions a more popular choice.