A large gateway to the Internet—the NSFNET—was developed by the National Science Foundation with an estimated $121 million in federal funds from the United States government. As a step to privatize the global computer network, Sprint Corp., Pacific Bell, Ameritech, and Metropolitan Fiber Systems took over the management of the NSFNET in late 1994. After nine years in operation, the NSFNET was decommissioned in late April 1995.

The Unix operating system was originally developed at AT&T's Bell Laboratories by Ken Thompson, an employee engaged in various programming research projects. With access to an abandoned DEC PDP-7 computer that had no software, Thompson decided in 1969 to write a set of programs that would aid him in software research. Over a period of several years, and with the help of fellow researcher Dennis Ritchie, this set of programs evolved into a full operating system.

The Computer Science Division at University of California at Berkeley released in the late 70s a package of software for Unix originally named the Berkeley Software Distribution. Unix was then adapted by UCB's Computer Science Research Group for academic research and publishing. CSRG with the support of DARPA also enhanced various Unix operating system utilities that were released as BSD.

Linux was conceived in 1991 by Linus Torvalds at the University in Helsinki, Finland. Torvalds' early releases were inspired on Minix, a Unix clone developed by Andy Tanenbaum in the late 80s. As more people got involved in Torvald's project, Linux began to acquire the scalability of a Unix System V operating system.

References: SCO vs. IBM