United States, January 31, 2001

Red Hat launches new Update CD giving users the opportunity to get the new 2.4 kernel without having to buy a complete new operating system

Red Hat, the leader in developing, deploying and managing open source Internet infrastructure, announced today the Red Hat Linux 7 Update CD . This new CD includes all official Red Hat Linux 7 updates and additional contrib software and applications for Red Hat Linux.

"This new competitively priced product is great news for our customers and our channel. Our users will have access to the latest 2.4 kernel, without having to buy a whole new operating system," said Andy Dickens, European Sales Director. "Included in this product is a whole host of updates, applications and games and for the system administrators our SysAdmin Survival CD - a credit card sized CD-ROM which they can use during system maintenance."

The Red Hat Linux 7 Update CD will be available from Thursday February 8th 2001 through the channel, retail outlets and from http://www.europe.redhat.com/shop.
Estimated street price: USD13.50

Red Hat Linux 7 Update CD contains:

Kernel 2.4

The 2.4 kernel CD for Red Hat Linux 7 is the candidate release of the 2.4 kernel
issued by http://www.kernel.org to be used in a testing environment.

This version of the 2.4 kernel does not contain any patches provided by Red Hat for bugs or security issues.

Official Update/Contrib CD

All Official Red Hat Linux 7 updates
Additional contrib software and applications for Red Hat Linux
KDE 2.0.1 includes
- Core KDE libraries

- Core desktop environment

- KOffice suite, and more!
Automatic Graphical Installation

SysAdmin Survival CD

This is a credit card sized CD-ROM to be used during system maintenance.
Contains the most important tools and utilities required by system administrators such as:
- Tools for managing TCP/IP services (telnet,FTP, ssh, ...)

- Software for DNS and MAIL server maintenance

- Utilities for filesystem and disk maintenance (fdisk, mkfs.ext2, fsck.ext2,...)

- RAID partitioning software

- Editors like vi, joe ...

- System monitoring and analysis

Reboot your system after inserting the SysAdmin CD and you will have a mini Red Hat Linux operating system.

Games CD
This CD contains a collection of popular Linux games such as
- Parsec

- Tux Racer

- Pingus

- Penguin-Commander

- rocksndiamonds

- xinvaders

- 35 other selected Linux games in rpm format.

Live Directory - all games playable directly from CD-ROM

Available in the following languages:
English, German, French, Italian, Spanish

About Red Hat, Inc.

Red Hat (Nasdaq:RHAT) offers users one single, trusted point of contact and a common plaform for developing, deploying and managing open source across Internet infrastructure and devices that connect to the Internet, ranging from small embedded devices to high availability clusters and integrated Web server/ecommerce OSes. The Red Hat Network, Red Hat's unique management technology, helps companies worldwide easily manage it all by delivering open source products, service, support and information on-line in real-time.

In addition to the award-winning Red Hat Linux server operating system, Red Hat offers Stronghold Secure Web Server and Credit Card Verification Software for secure e-commerce and is the principal provider of GNU-based developer tools and support solutions for a wide variety of embedded processors. Red Hat also provides run-time solutions such as Linux, eCos, Embedded Red Hat, the award-winning RedBoot, custom engineering services, support and training to organisations in all embedded and Linux markets.

Red Hat is headquartered in Research Triangle Park, N.C. and has offices
worldwide. For investor inquiries, contact Gabriel Szulik at Red Hat, +1 919-547-0012.

Red Hat Europe was established in July 1999 with its European
headquarters based in Surrey, United Kingdom and offices throughout
Europe. Red Hat Linux is sold and supported through a number of major
distribution and industry partners throughout Europe and from

Red Hat Linux was named InfoWorld's Product of the Year for four years
in a row, was given a productivity accolade in Software
Development's Jolt Awards, was named an environment/desktop finalist in
the Ziff-Davis European Excellence Awards, won the editor's
choice awards from the Linux Journal and Australian Personal Computing
magazines, and won the `Just Plain Cool' award from Australian
Personal Computing magazine. At March's LinuxWorld Expo, more than 8,000
members of the Linux community voted Red Hat a
`LinuxWorld Favourite'. Red Hat Linux recently won a Product Excellence
award from Software Development Magazine.



LINUX is a trademark of Linus Torvalds. RED HAT is a registered trademark of Red Hat, Inc. All other names and trademarks are the property of their respective owners.


Forward-looking statements in this press release are made pursuant to
the safe harbor provisions of Section 21E of the Securities Exchange Act
of 1934. Investors are cautioned that statements in this press release
that are not strictly historical statements, including, without
limitation, management's plans and objectives for future operations, and
management's assessment of market factors, constitute forward-looking
statements which involve risks and uncertainties. These risks and
uncertainties include, without limitation, product plans and
performance, the ability of Red Hat to attract users to redhat.com, the
lack of demonstrated widespread acceptance of e-learning as an effect
training tool, reliance upon strategic relationships, management of
growth, the possibility of undetected software errors, the risks of
economic downturns generally, and in Red Hat's industry specifically,
the risks associated with competition and competitive pricing pressures,
the viability of the Internet, and other risks detailed in Red Hat's
filings with the Securities and Exchange Commission, copies of which may
be accessed through the SEC's Web site at http://www.sec.gov