EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS

05.30.08

Financial Games: Novell’s Main Strength?

Posted in Deception, Finance, GNU/Linux, Microsoft, Novell at 12:43 pm by Dr. Roy Schestowitz

Lots of companies do this, but it’s no excuse

This issue is one that we wrote about earlier today. Critically, we also wrote about the buybacks earlier this month, along with head-changes, offshoring, etc.

“Novell embellishes its case and offers a fantastic story because investors sometimes enjoy good news more than honesty.”Things are not going too well at Novell, but like most companies — no matter the circumstances — it manages to deceive the press. Novell embellishes its case and offers a fantastic story because investors sometimes enjoy good news more than honesty. Let’s just pretend that the massive looming layoffs are non existent, okay?

To repeat the gist of this story, Novell cut off 10% of its staff last year [1] (more axing to come soon) and it counts as “Linux sales” transitions from its old O/S/es to GNU/Linux [2] (e.g. OES). In other words, Novell is seems to be cooking the books and innocent folks like Matt Asay are buying it, much like the rest of the mainstream press. You can spot sheep when you see the likes of the Wool Street Journal promoting the blue- and white-collar chaps (blue chips for white sheep).

Novell is a partner of Microsoft now [3], so wanting it to succeed would be risky. In fact, relying on it would be risky too.

References below are from yesterday’s news alone.
____

[1] Novell moves into black in 2d quarter

Chief executive Ron Hovsepian slashed about 10 percent of jobs last year and focused on new Linux products, seeking to counter a drop in revenue from older software. Sales of its Linux operating system rose 31 percent to $29 million last quarter.

[2] Novell financials beat estimates again

The company said it showed healthy growth in its core business units around the Linux operating system, identity/access management software and systems management tools.

[This confirms what was said earlier about layoffs and cannibalisation. Linux sales are the main thing the company really raves about with actual figures, implying that the rest isn't too good (not enough to harp about).]

[3] Foolish Forecast: Novell Swings for the Fences

Don’t be fooled by the massive cash flow margins in 2007. It’s a mirage, generated by a cross-licensing and cross-promotion agreement with Microsoft that landed Novell a one-time $348 million payment. Without it, the trailing free cash flow margins would have stayed positive but in the lower single digits.

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Digg
  • del.icio.us
  • Reddit
  • co.mments
  • DZone
  • email
  • Google Bookmarks
  • LinkedIn
  • NewsVine
  • Print
  • Technorati
  • TwitThis
  • Facebook

If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

Pages that cross-reference this one

8 Comments

  1. David Flax said,

    May 30, 2008 at 1:54 pm

    Gravatar

    We’ve been through this before. Why is any of this bad news? Changing heads is a normal course of business. Buying your own stock is not necessarily bad news and in this case it is good news since Novell is very cash heavy. Offshoring is common place these days as well. Cutting staff can be good depending on which divisions Novell is cutting staff from? Do you know which divisions Novell cut staff from? Is it possible that these staff cuts were to remove duplicate positions within the company? I don’t know personally and maybe you do. Were they all developers?

    You should get one thing straight, Novell does not include OES as part of it’s Linux sales, OES is included in Workgroup sales which dropped 1% to 92 million. Maybe you know something investors don’t know but a 37% increase in revenue is rarely a bad thing.

  2. Roy Schestowitz said,

    May 30, 2008 at 2:21 pm

    Gravatar

    According to this logic, David, if a company adds staff, keeps the same managers for ages (maybe an entire career), has investors buying its stock (thriving as a publicly-traded company) and keeps its jobs close to ‘home’ (paying generously to employees), then that does not say anything about the company’s status.

    As for OES, it wasn’t an example that I was entirely certain about, but surely enough Novell is migrating old clients to GNU/Linux (in one form or another). That does not necessarily mean that it adds new clients.

  3. David Flax said,

    May 30, 2008 at 2:40 pm

    Gravatar

    Roy,

    That’s a stretch based on what I said. I said it is a normal course of business and not necessarily a bad thing. That certainly doesn’t mean that keeping the same managers and paying your staff well is a bad thing, but many companies expect some turnover. People in general need new challenges. It is a rare person that stays with a company for their entire career. Has it happened sure, it’s just not that common.

    Yes Novell is trying to migrate clients to Linux either OES or Suse. You say it does not neccessarily mean they add new clients. It also could mean Novell did add new clients. You just don’t know.

  4. Roy Schestowitz said,

    May 30, 2008 at 2:48 pm

    Gravatar

    That’s true. Novell knows best, but it keeps the cards close to its chest and its important deal redacted.

  5. David Flax said,

    May 30, 2008 at 2:59 pm

    Gravatar

    I agree with you there. I would rather know more about the deal too.

  6. Miles said,

    May 30, 2008 at 3:01 pm

    Gravatar

    Novell seems to be putting more of an emphasis on Linux the last year or two and so I suspect that the job cuts have been in non-Linux areas. Ironically, the text that Roy has quoted in red even seem to suggest that ;-)

    slashed about 10 percent of jobs last year and focused on new Linux products, seeking to counter a drop in revenue from older software.

    it showed healthy growth in its core business units around the Linux operating system

    Sounds like the cuts were in the aging proprietary software departments (e.g. NetWare?) since it’d be hard to focus on Linux if you are cutting Linux jobs. Plus we also know from reading various blog feeds, etc that Novell has been actively hiring in the Linux departments.

  7. Roy Schestowitz said,

    May 30, 2008 at 3:21 pm

    Gravatar

    Oh, of course Novell ‘recruited’ a lot of people for OpenSUSE. You know, to share the code to [sic] Novell and Microsoft.

  8. Victor Soliz said,

    May 30, 2008 at 5:45 pm

    Gravatar

    Enter Novell, a company that attributes its only success to being Microsoft’s sidekick.

What Else is New


  1. Links 22/10/2014: Chromebooks Surge, NSA Android Endorsement

    Links for the day



  2. Links 21/10/2014: Debian Fork Debate, New GNU IceCat

    Links for the day



  3. Criminal Microsoft is Censoring the Web and Breaks Laws to Do So; the Web Should Censor (Remove) Microsoft

    Microsoft is still breaking the Internet using completely bogus takedown requests (an abuse of DMCA) and why Microsoft Windows, which contains weaponised back doors (shared with the NSA), should be banned from the Internet, not just from the Web



  4. Microsoft 'Loving' GNU/Linux and Other Corporate Media Fiction

    Microsoft has bullied or cleverly bribed enough technology-centric media sites to have them characterise Microsoft as a friend of Free/Open Source software (FOSS) that also "loves Linux"



  5. India May be Taking Bill Gates to Court for Misusing His So-called 'Charity' to Conduct Clinical Trials Without Consent on Behalf of Companies He Invests in

    Bill Gates may finally be pulled into the courtroom again, having been identified for large-scale abuses that he commits in the name of profit (not "charity")



  6. The Problems With Legal Workarounds, Patent Scope, and Expansion of Patent Trolls to the East

    Patent trolls are in the news again and it's rather important, albeit for various different reasons, more relevant than the ones covered here in the past



  7. Links 20/10/2014: Cloudera and Red Hat, Debian 7.7, and Vivid Vervet

    Links for the day



  8. Links 20/10/2014: 10 Years Since First Ubuntu Release

    Links for the day



  9. How Patent Lawyers Analyze Alice v. CLS Bank

    Breaking down a patent lawyer's analysis of a Supreme Court's decision that seemingly invalidated hundreds of thousands of software patents



  10. Is It Google's Turn to Head the USPTO Corporation?

    The industry-led USPTO continues to be coordinated by some of its biggest clients, despite issues associated with conflicting interests



  11. The EPO's Public Relations Disaster Amid Distrust From Within (and EPO Communications Chief Leaves): Part VII

    Amid unrest and suspicion of misconduct in the EPO's management (ongoing for months if not years), Transparency International steps in, but the EPO's management completely ignores Transparency International, refusing to collaborate; the PR chief of the EPO is apparently being pushed out in the mean time



  12. Links 18/10/2014: Debian Plans for Init Systems, Tails 1.2

    Links for the day



  13. Links 18/10/2014: New ELive, Android Expansion

    Links for the day



  14. Another Fresh Blow to Software Patents (and With Them Patent Trolls)

    Another new development shows that more burden of proof is to be put on the litigant, thus discouraging the most infamous serial patent aggressors and reducing the incentive to settle with a payment out of court



  15. Links 16/10/2014: New Android, SSL 3.0 Flaw

    Links for the day



  16. How the Corporate Press Deceives and Sells Microsoft Agenda

    Various new examples of media propaganda that distorts or makes up the facts (bias/lies by omission/selection) and where this is all coming from



  17. Vista 10 is Still Vapourware, But We Already Know It Will Increase Surveillance on Its Users and Contain Malicious Back Doors

    The villainous company which makes insecure-by-design operating systems will continue to do so, but in the mean time the corporate press covers only bugs in FOSS, not back doors in proprietary software



  18. Links 15/10/2014: KDE Plasma 5.1 is Out, GOG Reaches 100-Title Mark

    Links for the day



  19. With .NET Foundation Affiliation Xamarin is Another Step Closer to Being Absorbed by Microsoft

    Xamarin is not even trying to pretend that separation exists between Microsoft and its work; yet another collaboration is announced



  20. The EPO's Protection Triangle of Battistelli, Kongstad, and Topić: Part VI

    Jesper Kongstad, Benoît Battistelli, and Zeljko Topić are uncomfortably close personally and professionally, so suspicions arise that nepotism and protectionism play a negative role that negatively affects the European public



  21. Corporate Media Confirms the Demise of Software Patents in the United States; Will India and Europe Follow?

    It has become increasingly official that software patents are being weakened in the United States' USPTO as well as the courts; will software leaders such as India and Europe stop trying to imitate the old USPTO?



  22. Links 14/10/2014: CAINE 6, New RHEL, Dronecode

    Links for the day



  23. Microsoft's Disdain for Women Steals the Show at a Women's Event

    Steve Ballmer's successor, Satya Nadella, is still too tactless to lie to the audience, having been given --through subversive means -- a platform at a conference that should have shunned Microsoft, a famously misogynistic company



  24. SCOTUS May Soon Put an End to the 'Copyrights on APIs' Question While Proprietary Giants Continue to Harass Android/Linux in Every Way Conceivable

    Google takes its fight over API freedom to the Supreme Court in the Unites States and it also takes that longstanding patent harassment from the Microsoft- and Apple-backed troll (Rockstar) out of East Texas



  25. Patent Lawsuits Almost Halved After SCOTUS Ruling on 'Abstract' Software Patents

    The barrier for acceptance of software patent applications is raised in the United States and patent lawsuits, many of which involve software these days, are down very sharply, based on new figures from Lex Machina



  26. Links 13/10/2014: ChromeOS and EXT, Debian Resists Systemd Domination

    Links for the day



  27. Links 12/10/2014: Blackphone Tablet, Sony's Firefox OS Port

    Links for the day



  28. Links 9/10/2014: Free Software in Germany, Lenovo Tablets With Android

    Links for the day



  29. Links 8/10/2014: A Lot of Linux+AMD News, New ROSA Desktop Is Out

    Links for the day



  30. Lawyers' Propaganda About Software Patents and a New AstroTurf Entity Called Innovation Alliance

    Patent propaganda and deception from patent lawyers (among other parasites such as patent trolls) continues to flood the Web, intersecting with reports that prove them totally wrong


CoPilotCo

RSS 64x64RSS Feed: subscribe to the RSS feed for regular updates

Home iconSite Wiki: You can improve this site by helping the extension of the site's content

Home iconSite Home: Background about the site and some key features in the front page

Chat iconIRC Channel: Come and chat with us in real time

CoPilotCo

Recent Posts