Many of the most vocal open-source evangelists have been pinning their hopes on the public sector to gain a foothold against Microsoft.

So the news that government users can now purchase Microsoft licences at an even lower price - thanks to the latest NHS contract invoking a new volume discount level - will be seen as a blow to their hopes.

The commercial argument has long been a weak spot for Linux. There is a lot more to a decision than whether the base software is 'free' or not. Novell and Red Hat can bring some extra contractual nous to bear, but Microsoft is tying up the lucrative deals in the meantime.

The state of the technical argument is also becoming clearer. Open source is increasingly perceived as a genuine, but niche, desktop alternative.

The Office of Government Commerce (OGC) has proclaimed open-source as a viable technical option for public sector PCs, and the NHS has a deal in place with Sun Microsystems for 5,000 desktops - but that is a drop in a considerable ocean when the health service then buys 900,000 Windows licences.

The hope for the open-source community is that some of its leaders are adopting a more realistic view of their prospects, instead of the strident 'Linux is best, Microsoft is the devil' calls we have been used to hearing.

In his interview with Computing this week, Stuart Cohen, chief executive of international Linux consortium Open Systems Development Labs, says open-source is ideal for 'fixed-function' users - those needing just basic features such as email and browsing. He admits there is work needed in functions that are important for commercial and government users such as mobile computing and collaboration.

This new realism will be vital for the next stage of the debate if Linux is to take a meaningful role as a mainstream alternative to Windows. The technical community around open-source has been its strength to date, but buying decisions are made on a commercial basis, and this is where the proponents of Linux have most ground to make up.