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Red Hat Assists Israeli Startups to Increase Software Revenue

Raleigh, North Carolina-based Red Hat has begun a program for Israeli startups designed to boost use of its open-source software and increase sales as more companies migrate to cloud computing.  Seven Israeli early-stage technology companies with revenue of less than $1.5 million each have been chosen to get free access to Red Hat enterprise software.  Tel Aviv-based Typemock, a provider and pioneer of unit testing solutions, was among the first Israeli companies to join.  The program will be expanded in Israel before being extended to other countries, according to Red Hat’s CEO Jim Whitehurst, who launched the new initiative during his recent visit to Israel.   The company will offer Red Hat software to the firms at a declining discount as their revenue grows.

Red Hat is the world’s leading open source and Linux® provider, and has a strong history with  Israeli technology, having acquired Ra’anana-based Qumranet for $107 million in 2008 and partnerships with other Israeli companies including Mellanox and Radware.   The company doesn’t necessarily plan to buy startups that enter the program, Whitehurst said in an interview with Bloomberg.  Even so, Red Hat will “be significantly more acquisitive than we have been,” he said.

Red Hat intends to triple sales to $3 billion in five years, boosted by the rising popularity of cloud computing.   Companies such as Amazon.com are expanding cloud-computing sales in the US as the government shifts $20 billion of the $80 billion in yearly information-technology spending to the services, which let users share resources such as data storage and software.

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