Sales chalked up by Linux under licensing agreements totaled some 2.6 billion yen in Japan in 2003, up a sharp 37.5 percent from the previous year, a high-tech research firm said Wednesday.

Linux is an open-source operating system.

Domestic sales of other operating systems, including Windows, grew a meager 0.5 percent to 321 billion yen, according to International Data Corp. of Japan.

Although Linux is offered free of charge, users must pay when the operating system is processed into package software and other products.

IDC Japan believes the domestic market for Linux will exceed 12 billion yen in 2007 -- though it will be unable to grab a bigger market share than the Windows operating system due in part to limited availability of application software.