
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.
Originally, the strength of UNIX was its relatively open development model. When that started going away, UNIX first went a little up, then back down because of corporate fragmentation--where MS gained its beachhead. I think Linux's gradual ascendance is because it returns to the old, open model.