LynuxWorks engineers say that the new operating system, known as BlueCat Linux 3.0, will serve as a foundation that ultimately could take Linux into new territory, including mission-critical applications in military and aerospace, as well as in printers and other low-end consumer products. Up to now, Linux has primarily been applied in Web servers and firewall servers, but has yet to spread itself into a broader array of embedded applications.

LynuxWorks Inc. (San Jose, Calif.), previously known as Lynx Real-Time Systems, earned its reputation as a provider of real-time embedded operating systems since 1991. Its Lynx operating systems were used in military and aerospace, in particular in air traffic control and other applications that require fast, reliable real-time operation. ISD Corp., which merged with LynuxWorks on July 31, focused its Royal Linux operating system on low-end consumer applications. By merging, the two can now support ARM 720T, StrongARM and Hitachi SH-3 cores, as well as Motorola, Intel and MIPS processors. "Over time, we plan to merge the best features of Royal Linux into the BlueCat offerings," said Art Swift, chief operating officer of LynuxWorks.

Merger meaning

The merger of the two companies, which together have 250 employees, is seen as a significant sign of the potential of Linux in the embedded market, industry analysts said. Because LynuxWorks is an operating-system supplier and ISD Corp. is primarily a services supplier, the merger is analogous to the mergers of such companies as Wind River and ISI Corp., or Red Hat and Cygnus Solutions. In those cases, operating-systems suppliers merged with services companies as a means of offering a broader customer package.

Such mergers are particularly important for Linux-based companies, analysts said. That's because, unlike most real-time operating systems, Linux-based systems are not built on the collection of an up-front development fee. "If you're going to go with the Linux model, your money will come from the services you provide because the Linux OS is basically royalty free," said Daya Nadamuni, senior analyst at Dataquest Inc. (San Jose, Calif.). "So, as an embedded software vendor, it behooves you to build up your services organization."

Although Linux still holds only a small percentage of the embedded OS market, that business model worries many of the embedded, real-time operating-systems vendors, who live off the royalties from their products. "They see it as a threat," Nadamuni said. "There is still a question of how much dominance Linux could gain outside the server space. No one knows yet, but they could very well become dominant players."