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Mexican wunderkind takes aim at Microsoft's dominance

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CAMBRIDGE, Mass. - Plotting the overthrow of the world's largest software company is no job for a part-time revolutionary, says Miguel de Icaza, a 27-year-old computer whiz who has tried it.

A year ago, he was devising a way to turn the conventional software industry on its head, but only after his day job as a systems administrator in Mexico City.

Now, with an "Innovator of the Year" award under his belt from the Massachusetts Institute of Technology, he runs a company that develops alternatives to some of Microsoft Corp.'s key products.

And he conjures up a day when his so-called open source software will be better than Bill Gates' best - and free. In open source, the programming instructions that underlie all software are available for everyone to see and improve. That leads to programs with lower prices and fewer flaws than proprietary software such as Microsoft's, proponents say.

Mr. de Icaza's dream has its roots in the enormous technological needs and limited resources of his native Mexico. But to achieve it, he moved to this northerly hotbed of technological innovation to found Helix Code Inc.

"I miss tacos and salsa, and lunch is a poor excuse for eating," said the homesick Mr. de Icaza. "But we have to form a team, and being here makes it a lot easier to meet people."

Open source software is growing up. It already competes successfully in the market for computer servers, such as the ones that power the Internet.

Helix Code and several other U.S. companies are developing open source applications to compete with Microsoft programs such as Outlook, Excel and Word.

Their goal: to spread open source software's low cost and stability to everyone from secretaries to CEOs - and to free people to spend more time using their computers and less time fixing them.

Oh, and also to break Microsoft's stranglehold on much of the global software industry. The titan based in Redmond, Wash., is already reeling from the U.S. Justice Department's antitrust suit and fallout from the "ILOVEYOU" virus, which exposed security flaws in Microsoft products.

"One company can't provide all the innovation the world needs," said Mr. de Icaza, who now has 28 employees at Helix Code and a web of collaborators around the globe. "The innovation the world needs has to come from all corners of the planet."

Open source software, or free software, is catching on throughout cyberspace. Linux, which is open source, came from nowhere in 1996 to become the fastest-growing operating system in the world today.

Computer manufacturers such as Round Rock-based Dell Computer Corp. and Houston-based Compaq Computer Corp. now offer machines installed with Linux (rhymes with "cynics"). International Business Machines announced Tuesday that it will support Linux on its mainframes and is funding more research.

"We see Linux as a disruptive technology; it's like the Internet in the early '90s," said Daniel Frye, the program director at IBM's Linux Technology Center. "Our job is to make it mature faster."

Open source products are also catching on worldwide because of their low cost. Mexico, Brazil, India, Italy and France have installed Linux-based national computer networks in their schools.

"It doesn't take a sleuth to see that as schools go on Linux, you could have 600 million students who have never used another operating system," said Frederick Berenstein, a co-director of Linux Global Partners, a New York-based venture capital group that is financing Helix Code.

Of course, most computer users never actually see the operating system they're using. So to offer open source products for them, Helix Code is developing the so-called GNOME (pronounced guh-NOME) programs.

The principal components of GNOME include GNUmeric, a spreadsheet like Excel; a graphics program called GIMP; and Evolution, a program like Microsoft Outlook that offers e-mail service and a calendar - not to mention the inspiration for adopting the monkey as a company mascot. There is no word processing program, but Helix Code will begin developing one this fall.

Making money

The challenge is to turn a profit.

According to the copyright protecting open source software, everyone can see its programming code, but any changes must remain available - and free - to all. So, Mr. de Icaza and business partner Nat Friedman hope to make money by offering extra service.

For example, a large corporation might buy an annual service contract with Helix Code, and the software company's programmers would then oversee the installation and use of the programs, and tailor them to the client's needs.

Any programming glitches could be fixed immediately, calming people's frequent urges to punch their computer screens.

"You won't have to wait three years to get a bug fixed," said Mr. de Icaza. "Using a computer should be as easy as using your toaster in the morning."

Sound crazy? Some say it is, praising Helix Code's idea but questioning whether its business plan will work.

"There's definitely demand for something like what Helix Code is doing. I just don't understand their business model," said Dave Trowbridge, a senior analyst at Survey.com, a market research company in Campbell, Calif. "Altruism is great, but it doesn't pay the rent."

Moreover, the programs in Microsoft's "Office" suite, along with its Windows operating system, now claim 120 million licensed users worldwide - a huge customer base.

"Microsoft believes it is providing an efficient and powerful office productivity solution," said a Microsoft spokeswoman. "At this point in time, Microsoft doesn't believe that open source is compatible with the level of service, product consistency and vendor relationships that customers expect."

But don't try telling that to a growing number of publicly traded software companies that are betting their futures - and their cash flow - on free software. They include Caldera Systems Inc. from Orem, Utah; Corel Corp. from Ottawa, Ontario; and Red Hat Inc. from Research Triangle Park, N.C. which is helping Helix Code with GNOME.

Then there are the folks at Helix Code.

In their corner of Cambridge, which lies across the Charles River from Boston, squat brick buildings that once housed factories now play host to software, Internet and biotechnology companies. MIT's campus is a few blocks away, and there's a palpable sense that new and better technologies inevitably replace old ones.

Mr. de Icaza says the development process of proprietary software, in which only engineers from one company see the code, leads to expensive programs with lots of programming flaws. Bugs constantly cause computers to crash, terrorizing users with the infamous "blue screen of death" and jamming the lines to technical support centers.

But in an age of instant global communications, everyone can see the code of open source products, and an army of passionate programmers linked by the Internet can write software and fix bugs.

"As technology moves on, as it always does, the innovations [in proprietary software] are going to die," said Mr. Friedman, 22, Helix Code's CEO. "Free software lasts forever, because it's free to evolve."

Helix Code is already generating sales, by negotiating the installation of GNOME with several original equipment computer manufacturers, plus ongoing service contracts.

Open sourcers might get additional help from emerging trends in the software industry, analysts say.

Software has long been seen as akin to a manufactured good such as a car or a lawnmower. Large companies hire programmers to develop software, and the sale price covers the costs.

But the growth of Linux has proved that the combined efforts of thousands of Internet-connected programmers can yield software that has fewer bugs than proprietary products, at least for large servers.

Moreover, the manufacturing business model does not apply in the real world, says Eric S. Raymond, who wrote an influential book advocating open source software called The Cathedral and the Bazaar. When a software vendor goes belly up, its leftover products lose almost all their value because customers know they will no longer get service and product support.

A better business model, says Mr. Raymond, is to think of software as a service industry. Advice on how to fix bugs or make software more useful to a client is just as valuable as the digital bits that compose it.

"Software is largely a service industry operating under the persistent but unfounded delusion that it is a manufacturing industry," Mr. Raymond wrote in an essay called The Magic Cauldron.

"To handle the real cost structure of the software life-cycle efficiently, ... we require a price structure founded on a continuing exchange of value between vendor and customer," he wrote.

Helix Code is trying to create just that, and it's getting some help from veteran software revolutionaries at a California company called Eazel Inc.

Apple connection

Several former employees of Apple Computer Inc. founded Eazel last year. They are now developing a file manager for GNOME that they say will look and feel like the one used by Apple's Macintosh.

Years ago at Apple, Eazel co-founder Andy Hertzfeld helped design many computing features that are standard today, such as user-friendly interfaces and point-and-click mouses.

"I know what it's like to be at the center of a revolution, to have a little flickering flame in your mind," said Mr. Hertzfeld, 47, whose job title is "software wizard."

"If you have a committed team and a great idea, you can really make a difference in the world," he said.

As for Mr. de Icaza, a college dropout from the National Autonomous University of Mexico, he's busy spreading the gospel of GNOME. Over the next few weeks, he will visit the United Kingdom, Germany, Mexico and California. Then he heads back to Germany in June to give the keynote speech at IBM's second world Linux conference.

"I wouldn't want to say that everyone is going to be using open source software in two years," said Mr. de Icaza. "But in five years, it's going to become obvious that using any other kind of software is like flushing your money down the toilet."
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