
Linux only has a small percentage of the computing market, however Microsoft already considers it a major competition as the open source OS steals the hearts of many users. Following the hard numbers though, Microsoft also increases its market share on both server and desktop space with time. The only logical explanation is that Linux steals quite a market share from the traditional UNIX providers (SCO, Sun, SGI, HP, IBM). But only Sun seems to truly be in a real Linux trouble, as it is the one with a resistance to Linux integration to its full product range.
Because it is so similiar. It is very easy to port your apps from one version of Unix to another. Much easier than say migrating to NT. The traditional Unix vendors will have to value add to their products for them to stay afloat. But those old Unixes will die against Linux.