INTERVIEW 'Red Hat not just Linux provider'
Hahm Jae-kyung, general manager of Red Hat Korea, poses at the firm's head office in Seoul. / Courtesy of Red Hat Korea
Leading open source software provider tries to expand presence in Korea
By Kang Seung-woo
When people look up Red Hat on search engines, they would find that it is the world’s leading provider of Linux, the best-known and most-used open source operating system.
That is a widely accepted explanation on Red Hat. But its representative in Korea said that the firm is not content with the status quo as it is becoming one of the most successful open source software providers in the world.
“As open source is steadily expanding its presence, people who work in the information technology (IT) industry are well aware of Red Hat. However, even many of them still think that Red Hat is just a Linux company,” Hahm Jae-kyung, general manger of Red Hat Korea, said in a recent interview with The Korea Times.
North Carolina-headquartered Red Hat opened in 1993 and initially gained its footing with its Linux operating system. But rather than resting on its success, the company has shifted to a global provider of open source, enterprise IT solutions.
Their business portfolio ranges from Linux platforms, middleware, virtualization platform, storage, mobile platform and cloud computing.
“Open source refers to something that can be modified because its design is publicly accessible and there are more than 1.4 million open source projects. If there are some marketable programs, we pick and modify them for easy use for corporate client,” Hahm said.
Red Hat’s business portfolio is all open source-based, meaning that its modified software is also available for everyone in the communities.
“People can download and use Red Hat programs but we do not charge for them,” the general manger said.
He added that when problems in the products happen, free users tend to seek solutions from the communities, where many propose ideas that bear risks because they are not responsible for the results.
Hahm said that is where Red Hat is doing business.
“When corporate server systems break down, operators cannot address the problem by just rebooting the systems. As a result, they seek help from us and Red Hat offers tried, tested and trusted solutions to them,” Hahm said.
“In short, customers pay for Red Hat’s advanced technical support and maintenance.”
Along with its advanced IT solutions, Red Hat is famous for its unique subscription-based pricing.
“The subscription is a payment structure allowing a customer or an organization to subscribe to our IT services for a specific period of time, with a longer subscription leading to a lower cost,” Hahm said.
“It tackles financial burdens of customers as there are no license or upgrade fees. In addition, we do not charge maintenance fees, per-incident support fees or user access fees.”
Red Hat has said that its annual renewal rate is on a steady increase, with more customers adding more options on existing services.
Hahm added: “As the system was not common in the past, we had difficulty in explaining it to clients. But nowadays, the subscription-based pricing model is in an increasing use thanks to the rise of cloud computing.”
Its main Korean clients are mostly government organizations and large-sized companies such as the Korea Exchange, the Korea Broadcasting System, the Korea Deposit Insurance Corp., the Korea Land and Housing Corp., Nonghyup Investment and Securities and Hana Financial Investment.
“Along with the Korea Exchange, more than 50 percent of exchanges in the world use Red Hat’s Linux system, including the New York Stock Exchange (NYSE),” Hahm said.
Verizon, Adobe, Penn State and NASA’s Jet Propulsion Laboratory also take advantage of Red Hat services.
Red Hat has marked its 60th successive quarter of revenue growth as of the fourth quarter of last year and its Korean subsidiary is also seeking to expand its footing in Asia’s fourth-largest economy.
“Financial companies take up a large portion of our client list, but we have yet to attract customers from the banking industry as they also use the Linux-based system. First of all, we strive to draw such financial companies as our customer this year,” Hahm said.
“Korea is one of the most centralized countries, but we have some mid-sized firms in clients that are located outside Seoul and its surrounding area. We are set to beef up our coverage for those residing in local areas.”
He added a mounting number of people want to learn about open source software, but they has little chances. Recently, Red Hat launched many new open source products and focuses on promoting them to Korean consumers.
“Many know our brand as a Linux provider. We will try to change the perception with our various products,” he said.