Big Blue executive tells the Wall Street Journal that IBM plans to pour $1 billion into Linux and open source technologies for its “Power” server line. Two big questions:

1. Will the investment give a needed jolt to IBM’s server business?

2. Will this be another boost for Linux, especially in the server world struggle with Unix?

And another question:

Will there be a spillover effect on Red Hat, the dominant global Linux player with its Red Hat Enterprise Linux running on servers worldwide?

The news that the WSJ and ZDnet says is coming today at LinuxCon is certainly another does of credibility for Linux – something that Big Blue gave the fledgling operating system way back in 2000.

Notes ZDnet: “This announcement comes 12 years after IBM famously announced that it was backing the then unproven Linux with a billion-dollar investment.”

Jim Zemlin, executive director of the Linux Foundation, told ZDnet the IBM news could be important.

“The last time IBM committed $1 billion to Linux, it helped start a flurry of innovation that has never slowed,” he said. “We look forward to seeing how the Power platform can bring about further innovation on Linux, and how companies and developers can work together to get the most out of this open architecture.”

But for those who are fully aware of the problems facing IBM’s server business (furloughs, rumors of a sale), perhaps the most important immediate question is what the news will do for IBM?

Can IBM turn this news into a needed burst of sales momentum?

Big Blue’s decision definitely boosts Linux vs. Unix.

“We continue to take share in Unix, but it’s just not growing as fast as Linux,” Brad McCredie, an IBM vice president of Power development, told the WSJ.

McCredie also pointed out a key advantage to Linux in fostering innovation: It is open source.

“Once you get to an open software stack there is innovation taking place that people do covet,” McCredie said.

IBM also has plans for more “cloud” development, a space where Red Hat is certainly making a huge play.

[IBM ARCHIVE: Check out more than a decade of IBM stories as reported in WRAL Tech Wire.]