Linux was far from perfect and had been floating around as kind of an internal science project for much of the 90s. Suddenly it went from internal science experiment to heir apparent and was positioned largely by the IT folks that Microsoft had put at risk as a better alternative for UNIX than Windows.
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When the very people who are supposed to choose between products become the advocates of one or the other, bad decisions often result and are covered up.
Much like it was a decade before, with Client Server displacing Mainframes, so to it was again with Linux displacing UNIX. In the previous decade, it had been cost overruns that were concealed. With the current movement, the problems associated with replacing a very mature platform like UNIX by a, as yet, relatively immature platform like Linux were concealed from the operational managers by the IT departments.
Promising massive cost savings and faced with having to demonstrate these savings, IT employees put in massive amounts of time to create systems that fell well short of what similar products from companies like Sun could do easily. But, since IT owned reporting and had a direct interest in the result, it was as blind to what it was doing as Microsoft had been blind to creating this environment in the first place.
Eventually Linux grew up but not without a massive amount of heavy lifting from a customer base, which represented a cost many time what Microsoft was likely to have ever been able to charge. In addition, what they didnt realize was the repercussions of their actions as operational management looking for cost cutting trends began forcing a series of decisions which resulted in the massive off-shoring of IT jobs.
Many Linux advocates, flush with power, appeared to demonstrate that power truly does corrupt, and denial of service attacks against Microsoft and other foes like SCO (and those that seemed to support either) proliferated for a time. In many ways Linux became a bigger threat than Microsoft had been because the very people who were supposed to protect against any company gaining massive power to a degree that it put their firms at risk were now such a risk themselves.
This now seems to be self-correcting as Oracle, arguably an even scarier firm than Microsoft, moves in to seize control of Linux and is countered by the almost unbelievable combination of Microsoft and Novell. Whatever the outcome, the trend is now to once again separate the IT managers who are the decision makers from one of the platforms they must decide on.
However, at the end of all this, Linux is still closer to what the current and ex-UNIX (now Linux) shops want in a product. But progress is iffy and every little amount of it seems to come with substantial organizational pain.
From changes in the GPL, to anything that looks like it might be a product roadmap, Linux often makes the problems that Microsoft recently experienced getting Vista to market seem trivial by comparison.