SCO's demands that Linux users should pay for UnixWare licences appear to be falling on deaf ears.

Earlier this week SCO widened its legal wrangle over claims that it owns Linux code by taking on users as well as IBM's AIX customers.

The company said that it owns the copyright for Unix System V Code, which it claims is being illegally used in the Linux kernel.

SCO now wants users to pay for the privilege of using systems based on Linux kernel version 2.4x and later. But experts believe that users should watch and wait.

"SCO is being opportunistic ahead of the lawsuit with IBM by exploiting nervousness and trying to create as much fear, uncertainty and doubt as possible," said Andy Butler, research director at Gartner.

He explained that Gartner is not authorised to give legal advice but has advised clients that "they should not be blasé and should follow events carefully if they have significant Linux exposure".

"Users should not start waving their cheque books as there is no legal precedent for what SCO is demanding and it is not clear what laws have been broken," he added.

Insurance firm Reliance Mutual, which uses Linux-based PC servers and has Red Hat Linux to run its file server and internet name servers, is taking the Gartner stance.

IT director Adrian James said: "We will ignore SCO's demands and wait and see what happens.

"We purchased Red Hat in good faith and are up and running and have contractual agreements with them. We would be daft to set a precedent.

"I don't see that SCO's claims will make a huge impact on the freeware market as it is so well established."

Greg Carlow, managing director at reseller Repton, indicated that SCO's move had not worried customers.

"Nobody is saying they need to be careful because of SCO," he said. "We do a lot of work with software vendors in the finance and banking industry and they are all migrating to Linux because that's what the customers say they want.

"Customers are not saying that they'll stop using Linux. None have come to us expressing concern."

SCO has confirmed that commercial Linux customers which purchase the new UnixWare will be covered for any future use of Linux in a run-only, binary format.

Butler believes this is an attempt by SCO to "hobble the open source movement by depressing the market for evolving the source code".

"Agreeing to using Linux in run-only, binary format would mean that Linux code would become like proprietary Windows or Solaris code," he explained.

"Users would have no right to change or distribute the source code. The source code would remain locked away. SCO is trying to derail the Linux train."