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Media giant AOL/Time Warner is reportedly in negotiations to acquire the Linux distributor Red Hat, according to sources quoted in the Washington Post.

Sources told the paper that the media giant may use the operating system to make inroads within Microsoft's desktop OS market, possibly with AOL software opening a Linux environment within Windows itself.

Such an acquisition would put the company in a good position to take

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advantage of next-generation Internet-enabled set-top boxes and videogame consoles, which look poised to explode in 2002. Both CES winner Moxi Media Centre and Sony's PlayStation 2 use versions of Linux as their operating system.

And with 33 million registered subscribers, AOL/Time Warner could use its Web dominance to push users to Linux, just as Microsoft, with its OS on 90 per cent of desktops, pushes Windows users to its Web services (MSN, .NET et al).

As ever, expect a fierce battle between the companies. Last year a break down in talks over AOL's incorporation of RealPlayer ended in AOL links and shortcuts being removed from Windows XP. And just months later, RealPlayer shortcuts appeared on Compaq desktops. Not much love lost there, we feel.

There's no definite price placed on Red Hat as yet, which makes its money selling support services along with its version of Linux, but it boasts a market capitalisation of about $1.45bn and 600 employees and a roster of clients that includes Amazon and IBM.