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 28/7/2016: CORD as Linux Foundation Project, Wine 1.9.15 Released

    Links for the day



  2. EPO Loses More Than 80% of Cases at the International Labour Organisation (ILO)

    The International Labour Organisation (or Organization) helps show just to what degree the European Patent Office (EPO) violates the rights of workers



  3. To Understand What Battistelli Has Turned the EPO Into Look at Turkey and China

    Battistelli and his notorious Vice-President from SIPO (Croatia) turn the European Patent Office, once the pride of Europe, into a human rights cesspool with SIPO (China) connections



  4. Patent Lawyers Move Closer to Battistelli's Rubber-stamping Office While the Appeal Boards Pushed Away as Collective Punishment Which Masks Decline in Patent Quality

    Urgently sending appeal boards away and urgently granting applicants patents without proper examination will be Battistelli's sorrow legacy at the European Patent Office



  5. Software Patents a Dying Breed, But Patent Lawyers in Denial Over it and Notorious Judge Rodney Gilstrap Ignores Alice (Supreme Court)

    A look at what law and practice are saying about software patents, contrasted or contradicted by the patent industry and trolls-friendly courts (which make business out of or together with patent aggressors)



  6. CAFC Meddling in PTAB Affairs; Unified Patents Fights a Good Fight by Invalidating Software Patents

    A look at how the AIA's Patent Trial and Appeal Board is invalidating software patents post-Alice, with or without involvement of patent courts



  7. Early Certainty That Benoît Battistelli is Dangerously Clueless and a Major Risk to the EPO

    The chaos which Team Battistelli is assured to deliver if it doesn't treat scientists like scientists, instead viewing them as a production line with rubber-stamping duties



  8. OIN Makes Claims About “Open Source Innovation”, But It Produces Nothing and Protects Virtually Nobody

    The Open Invention Network (OIN) reports growth, but in practical terms it does little or nothing to help developers of Free/Open Source software



  9. Links 27/7/2016: New CrossOver, Blackmagic for GNU/Linux

    Links for the day



  10. The Death of Software Patents and Microsoft's Coup Against Yahoo! Made the Company Worthless

    A look at what happens to companies whose value is a house of software patents rather than code and a broad base of users/customers



  11. Munich Attack Mentioned by EPO But Not Ansbach

    The EPO does the usual right-wing thing (exploiting disaster/emergency for domestic crackdowns), but some bemoan the omission of the explosion at Ansbach (also in Germany)



  12. Kluwer Thinks People Are Clueless About the Unitary Patent System and Pretends It's Business as Usual

    Flogging the dead UPC horse at times of great uncertainty (enough to bring the UPC to a standstill)



  13. Almost Everything That the Government Accountability Office Says is Applicable to the EPO

    The Government Accountability Office in the United States produces reports which can serve as a timely warning sign to the European Patent Office, where patent quality is rapidly declining in order to meet 'production' goals



  14. Microsoft Says It Loves Linux, But Its Anti-Linux Patent Trolls Are Still Around and Active

    Highlighting just two of the many entities that Microsoft (and partners) use in order to induce additional costs on Free (as in freedom) software



  15. Links 26/7/2016: Microsoft Growing Desperate, Linux 4.8 Visions

    Links for the day



  16. Links 25/7/2016: Linux 4.7 Final, PostgreSQL 9.6 Beta 3

    Links for the day



  17. Leaked: Boards of Appeal Face 'Exile' or 'Extradition' in Haar After Standing up to Battistelli

    A look at some of the latest moves at the European Patent Office (EPO), following Battistelli's successful coup d’état which brought the EPO into a perpetual state of emergency that perpetuates Battistelli's totalitarian powers



  18. The US Government Accountability Office (GAO) Comes Across as Against Software Patents, Relates to the EPO as Well

    Some analysis of the input from the Government Accountability Office (GAO) with focus on the EPO and software patents



  19. In the US, Patent Trolls Engage in Patent Wars and Shakedowns, Whereas in China/Korea Large Android OEMs Sue One Another

    Highlighting some of the differences between the US patent system and other patent systems



  20. Links 24/7/2016: Elive 2.7.1 Beta, New Flatpaks and Snaps

    Links for the day



  21. Links 23/7/2016: Leo Laporte on GNU/Linux, Dolphin Emulator’s Vulkan Completion

    Links for the day



  22. Links 22/7/2016: Wine 1.9.15, KaOS 2016.07 ISO

    Links for the day



  23. Haar Mentioned as Likely Site of Appeal Boards as Their Eradication or Marginalisation Envisioned by UPC Proponent Benoît Battistelli

    Not only the Staff Union of the European Patent Office (SUEPO) is under severe attack and possibly in mortal danger; the increasingly understaffed Boards of Appeal too are coming under attack and may (according to rumours) be sent to Haar, a good distance away from Munich and the airport (half an hour drive), not to mention lack of facilities for visitors from overseas



  24. EPO Attaché Albert Keyack Viewed as Somewhat of a Mole, Reporting From the US Embassy in Brazil Until Shortly Before the Temer Coup

    Public responses to the role played by Albert Keyack on behalf of the United States inside the European [sic] Patent Office



  25. EPO Insiders Explain Why the EPO's Examination Quality Rapidly Declines and Will Get Even Worse Because of Willy Minnoye

    Public comments from anonymous insiders serve to highlight a growing crisis inside the European Patent Office (EPO), where experienced/senior examiners are walking away and leaving an irreplaceable bunch of seats (due to high experience demands)



  26. Patents Roundup: BlackBerry, Huawei, PTAB, GAO, Aggressive Universities With Patents, and Software Patents in Europe

    Various bits and pieces of news regarding patents and their fast-changing nature in the United States nowadays



  27. Glimpse at Patent Systems Across the World: Better Quality Control at the USPTO Post-America Invents Act (2011), Unlike the EPO Post-Battistelli (2010)

    While the EPO reportedly strives to eliminate pendency and appeal windows altogether (rubberstamping being optimal performance as per the yardstick du jour), the USPTO introduces changes that would strengthen the system and shield innovation, not protect the business model of serial litigants



  28. Blockstream Has No Patents, But Pledges Not to Sue Using Patents

    Blockstream says that it comes in peace when it comes to software patents, which triggers speculations about coming Blockchain patent wars



  29. Links 21/7/2016: Ubuntu 16.04.1 LTS, Linux Mint 18 “Sarah” Xfce Beta

    Links for the day



  30. Links 21/7/2016: An Honorary Degree for Alan Cox, Looks Back at DebConf16

    Links for the day


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