The Linux market is trapped in a chicken (or perhaps penguin) and egg situation as vendors wait for users to show serious interest in Linux-based enterprise applications, and users wait for vendors to produce the goods.

According to analyst IDC, Linux users in Western Europe are seeing the value of buying into the web server and networking offerings of the open source software, but few are planning more complex solutions which would generate revenue for vendors.

Kirsten Ludvigsen, director of IDC's European Unix, client server and workstation research, said: "Users are attracted to Linux for its cost effectiveness and malleability for specific-purpose devices, both client and server. However, the lack of available applications and perceived lack of service and support offerings are major inhibitors to this market's growth."

Ludvigsen said the industry is waiting for user demand to pick up before it develops enterprise applications and commits to the Linux environment. This, she argues, has lead to a "chicken and egg situation" in which the Linux industry may suffer from a lack of sufficient funding to continue developing future products.

IDC said the main question is whether users will buy into the open source development model with no future roadmap, an economically unstable players and a current lack of specific types of applications.

Development on bringing Linux into the commercial server space, despite the support of many leading vendors such as Dell and Computer Associates, is still a long way off in terms of scalability, reliability, and availability features, according to IDC.

The analyst said that the major areas of deployment of Linux will be in the embedded or appliance space for both clients and servers until 2004, by when it predicts there will be three million Linux server licences.

"Clients will have many forms and shapes, and we believe smart handheld devices and cable TV devices will be the major areas of growth for Linux in Western Europe," said Ludvigsen.