IBM is putting more product development and sales resources into building markets for open-source software in addition to Linux, a move the company says can increase use of its products including chips, desktop applications, and middleware.

Among the projects under way are tuning the Linux kernel to run faster and more securely on IBM's new Cell processor, shipping versions of Lotus desktop apps that run on Linux, and expanding IBM's open-source Web server business, company executives said Tuesday at the LinuxWorld conference in San Francisco. Scott Handy, VP of Linux and open source at IBM, called the effort "a fundamental expansion of what we're doing around open source."

The worldwide market for Linux operating systems is worth about $7 billion, said Handy. IBM for several years has invested in development and marketing of Linux as a counterweight to Microsoft's Windows system on computer servers. Now, IBM says, it's expanding sales of open-source software that runs on top of Linux. Use of open-source software begets other open standards in IT environments, which can lead to sales of IBM products. "We need to integrate Linux into the fabric of IBM," Handy said.

Marketing open-source software can help IBM reach new customers in Brazil, Russia, India, and China, as well as small and midsized companies in the United States, Handy added. IBM is selling open-source products to customers including Nationwide Insurance and Hoplon Infotainment, a Brazilian hoster of multiplayer online games. IBM's Global Services consulting unit has also created open-source businesses to support the initiatives.

IBM's new open-source development and sales efforts fall into four broad categories: desktop software, Web-serving software and development tools, chips, and implementing industry specs. For example, IBM recently began shipping a version of its Lotus Notes e-mail app that's native to Linux, and within a month plans to ship a Linux version of Lotus Sametime, an instant-messaging app for companies. Downloads of IBM's WebSphere Application Server Community Edition, based on the company's acquisition of Gluecode Software last year, have tripled since the beginning of the year, said Dan Frye, VP of open systems development at IBM. IBM is tuning the Linux kernel to run faster on its Cell processor, developed for the video game market and which the company hopes will play a larger role in its business servers. And IBM is distributing an "open health-care framework" under an open-source license for developing software apps for the medical industry.