LOCAL FIRMS RIDING LINUX TO SUCCESS.

Byline: Jason Z. Cohen Staff Writer

Just say the word Linux these days and it's good for at least a 10 percent run-up in your company's stock price.

It may be short-lived, but several local companies have felt the power of Linux in the past week.

Even K-tel International Inc. -- yes that K-tel -- got a bit of a Linux boost Thursday when it announced the switch of its Internet servers to a Linux-based system. The news pushed the Calabasas-based music company's stock above $10 per share for a time before it settled in to close at $9.71875 per share, a 4.17 percent increase over its Wednesday close.

K-tel said in a written statement the Linux operating system it purchased from Red Hat Inc. will speed its servers and allow more people to use its Internet site.

Also riding the Linux bubble was National Technical Systems, which told investors Thursday it now has the capability to test the operation of Linux-based software and hardware.

Investors responded by buying the company's shares -- lots of them. More than 1.6 million NTS shares changed hands Thursday, though the average daily volume is closer to 18,000.

Add to that two other local firms which recently pledged their allegiance to Linux and are watching their stock prices soar. On Monday, Chatsworth-based MRV Communications and Newbury Park-based Pacific Softworks both saw their stock prices increase sharply after announcements from both companies regarding their forays into products designed for Linux systems.

Linux is an operating system that is gaining popularity as an alternative to Windows. It was developed by Linus Torvalds, who was a student at Finland's Helsinki University when he enlisted the help of more than 1,000 programmers across the world to develop the system.

Once it was completed, Torvalds made the source code -- essentially the heart and soul of the software -- available for free on the Internet.

While companies such as Red Hat Software and VA Linux Systems have ridden initial public offerings to meteoric stock price increases, Torvalds hasn't pulled in riches from Linux -- though he owns some shares of VA Linux Systems.