Recent public statements by Microsoft executives have cast Linux and the open-source philosophy that underlies it as, at the minimum, bad for competition, and, at worst, a “cancer” to everything it touches.

Behind the war of words, analysts say, is evidence that Microsoft is increasingly concerned about Linux and its growing popularity. The Unix-like operating system “has clearly emerged as the spoiler that will prevent Microsoft from achieving a dominant position” in the worldwide server operating-system market, IDC analyst Al Gillen concludes in a report.

While Microsoft’s overall operating-system market leadership is by no means in jeopardy, Linux’s continued gains make it harder for Microsoft to further its core plan for the future, Microsoft.Net. The plan is a software-as-a-service initiative similar to plans from competitors including Hewlett-Packard, IBM and Sun Microsystems.

One of the cornerstones of .Net is HailStorm, which is built around the company’s Passport authentication service. Microsoft.Net and HailStorm make use of XML (Extensible Markup Language) to pass information between computers based on Windows and computers using other operating systems. However, many .Net components--such as Passport and server-based software including the company’s SQL Server database software and BizTalk e-commerce server--run only on Windows.

“The infrastructure to operate XML Web services relies on the Windows operating system and the .Net Enterprise Servers,” Microsoft’s marketing literature states. Microsoft needs to control the server operating-system market if HailStorm and all the .Net services and subscriptions associated with it are to succeed, analysts say. “HailStorm itself by definition needs Microsoft-provided or -partnered services, which means Microsoft’s or its partners’ servers,” said Gartner analyst David Smith. “In that sense, Linux is a threat to .Net.”

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Microsoft is expected to spend hundreds of millions of dollars marketing and developing .Net. Virtually every product from the company ties in to the plan at some point.