"Red Hat's success is a testament to the role it played in bringing Linux to the mainstream, and the continued shift towards open source in the enterprise," said Mark Shuttleworth, founder of fellow Linux distributor Canonical, in an email exchange.

When Red Hat held its IPO (Initial Public Offering) in 1999, the idea of making money from open-source software was not a proven concept. Although open-source software was widely used then by academics and the technically inclined, enterprises were still wary of using the software, citing security fears and the need for holding a vendor accountable when something goes wrong. And investors would ask how a company could make money giving away the source code of its software at no cost.

"Consensus among many in the IT community [then] was that open source was a goofy, post-hippie kind of thing," King said.

Red Hat's consists of making the source freely available, and then charging subscription fees for enterprise-grade support. Today that model is copied--albeit on a smaller scale--by a wide range of open-source software companies, such as Eucalyptus (for cloud computing software), Alfresco (content management software) and Jaspersoft (business intelligence). Large IT vendors, such as Oracle, IBM and Dell, routinely offer some of their software as open source. Even the world's largest proprietary software vendor, Microsoft, , releasing some of its ancillary code as open source on its repository.

"Today, we're at a place in IT where online collaboration is such a broadly accepted concept," King said."Red Hat is an extremely well-run company, and collaborative development is paying off for everyone in the ecosystem," said Jim Zemlin, executive director at The Linux Foundation. The company is one of the largest contributors to the source code of the Linux kernel, he noted. "It is this commitment to collaborative development that is one of the key ingredients to its success."