SynApps The Open Source and Gadget blog

Matt Asay has some intelligence on RedHat trying to enter the hosting market:

"If Red Hat can learn this space well, it may position the company to do more with Red Hat Exchange, allowing it to fully host open-source applications (and take a percentage of the revenue for its troubles). It could also set Red Hat up nicely to better grok and respond to the rise of specialized web companies like Google that currently have adopted Linux en masse...and pay Red Hat $0.00 for it."

There is certainly a business in the high-end dedicated server market for Enterprise Linux distros. I know some hosters that buy both RHEL and SLES. At least one of them bought all the SLES they could eat from the licence flood that came from the NOVL/MSFT deal.

For the mass market and real SaaS offerings I believe RedHat (and Novell for that matter) would first have to find a stack that they can sell. As Matt says, $0 from Google. And $0 from anybody else in the Hosting / Telco / SaaS space for enything below high-end dedicated hosting.

I remember this painfully from my SUSE days (2001-2003), these guys know how to do platform and ignore maintenance and support offerings from Linux, Database, Web Server, Systems Management etc. vendors. Professional Open Source Exploiters you could say. But when it comes to applications they want and need help.

Google bought a dozen or two companies in this space. Instead of buying companies right away most Telcos, Internet Service Providers, Hosters and Carriers rather buy the software from people like Drupal/Acquia, Open-Xchange or SugarCRM for cool SaaS offerings.

RHAT needs Apps!