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Novell News Summary – Part III: More on the Financial Results, Novell Figures

Posted in Finance, Identity Management, Interview, Mail, NetWare, Novell at 4:51 pm by Dr. Roy Schestowitz

Trinity Church, Boston
Trinity Church, Boston

THE BOSTON press had nothing particularly interesting do share about Novell other than financial news and this thrown-in mention.

The area is home to big employers such as State Street Corp., Genzyme Corp., Novell, Fidelity Investments, Raytheon Co., and Thermo Fisher Scientific. And the city’s two convention centers brought more than 772,500 attendees to town in 2007.

It ought to be mentioned that here in Boycott Novell, some of our hecklers come from this region (near Novell’s headquarters) and many come from Germany too. Even Novell employees comment here anonymously sometimes. That’s why comments must be treated with suspicion and caution, even those appearing outside this Web site. We never censor any comments, not even when Novell employees post them from Novell’s offices.


This is where most of the news is concentrated this week. The Var Guy, who has friends/informants at Novell (mostly Dragoon), tries to keep an optimistic view and maintain composure.

First, the good news: Novell’s quarterly net income actually beat Wall Street’s expectations by a penny per share. But net income was down 36 percent and revenue was down 7 percent compared to the corresponding quarter last year, according to the Associated Press. In stark contrast, Red Hat’s revenue and net income both rose significantly during that company’s most recent quarter.

Admittedly, a head-to-head comparison of Novell and Red Hat financials isn’t really fair. Red Hat doesn’t have Novell’s legacy baggage. Plus, Red Hat also has two popular open source product lines (Red Hat Linux and JBoss middleware) compared to Novell’s singular hit: SUSE Linux.

VNUNet writes to say that “Novell posts disappointing results” and it talks about the layoffs which are coming.

But the firm’s employees have also been braced for further job cuts after an initial 100 cuts were announced earlier this month.

In previous coverage of these results [1, 2] we showed that the main (and maybe only) winner is Novell’s CEO, who had received a generous package of benefits. For many good comments about Novell’s poor results, see LinuxToday. Larry Dignan’s article, which we referenced before, has reached CNET where one person says that “Novell ran into the arms of Microsoft to be embraced. What Novell should have known is that Microsoft’s embrace of its competitors inevitably leads to their extinguishing.”

For completeness, here are several more reports (none of great importance) from earlier in the week, i.e. before the results got announced:

Novell, Inc. – Financial and Strategic Analysis Review – companiesandmarkets.com adds new report

This report presents an in-depth business, strategic and financial analysis of Novell, Inc.. The report provides a comprehensive insight into the company, including business structure and operations, executive biographies and key competitors. The hallmark of the report is the detailed strategic analysis on the company.

Beacon Equity Issues Technical Trade Alerts on Market Movers: HGSI, NOVL, SYNA, JDSU, HAL, MSFT

Today’s Trade Alerts include: Human Genome Sciences Inc. (Nasdaq: HGSI), Novell Inc. (Nasdaq: NOVL), Synaptics Inc. (Nasdaq: SYNA), JDS Uniphase Corp. (Nasdaq: JDSU), Halliburton Company (NYSE: HAL) and Microsoft Corp. (Nasdaq: MSFT).

Technical Trade Alerts on Market Movers: HGSI, NOVL, SYNA, JDSU, HAL, MSFT

The Trade Alert author also featured Novel’s collaboration with VMware to help software vendors build fSUSE Linux Enterprise-based virtual appliances:

“Novell Inc. (NOVL) shares fell 2.08% to hit $3.29 this morning. Novell engages in the development and integration of mixed information technology environments worldwide. … The company recently announced a broad collaboration with VMware to help independent software vendors (ISVs) build fully supported SUSE Linux Enterprise-based virtual appliances. The joint collaboration offers ISVs using VMware Studio a free evaluation redistribution of appliances built on fully supported SUSE Linux Enterprise, simplifying the process of creating virtual appliances. Both companies are also jointly working with ISVs to develop VMware Ready virtual appliances powered by SUSE Linux Enterprise.”

Stocks In Focus On Friday

Novell Inc. (NOVL) reported its first-quarter net income fell to $10.7 million, or 3 cents a share, from $16.8 million, or 5 cents a share, in the same quarter a year earlier. On an adjusted basis, Novell would have earned 7 cents a share. Revenue decreased to $214.9 million from $230.9 million a year ago, said the provider of open source software for businesses. Analysts surveyed by FactSet Research had forecasts, on average, earnings of 6 cents a share on revenue of $227.4 million.

Based on Novell’s earnings call, Red Hat is an open source company and Novell executives acknowledge that Novell is not. To quote Dana Russell: “So from that standpoint, if you look at our model, and our model is really is different than Red Hat’s model, Red Hat’s model is an open source model. Our model is geared towards not only performing well with our open source products but also generating significant profitability and margins with these managed services that we sell on top of that.”


There is nothing of significance here other than a couple of new articles that mention NetWare, namely:

i. Navigating throught DePauw’s different Novell network drives: from F: to Z:

If you’ve ever logged into Novell, either from your own laptop or a University computer, you’ve noticed that the computer acquires several additional drives after logging in. What you might not know is just how each of those drives works and how they can be utilized to make your life a little bit easier.

ii. ESET Captures 54th VB100 Award

Virus Bulletin introduced its first VB100 award in 1998, and conducts several comparatives every year, rotating its platforms between Linux, Windows, Windows servers and Novell Netware.


It turns out that there’s also a link between Barracuda and Novell, which is mildly interesting because Barracuda is suffering from software patents.

With message-level backup functionality, the Barracuda Backup Service can connect directly to Microsoft Exchange and Novell GroupWise to provide individual email backups for more granular restoration of user mailboxes and individual messages.

Identity Management

This is one of those areas where Novell is hoping for growth. It was only mentioned very, very briefly right here.

The system will share data with other Standard Life systems including Microsoft Active Directory, Novell e-Directory, Oracle Database and Oracle Internet Directory.


Eric Schmidt is possibly the best-known Novell veteran who’s alive and his role at Novell is mentioned here.

Schmidt joined Mountain View-based Google (NASDAQ:GOOG) as chairman in March 2001 and as CEO in August of that year. Before that he was chairman and CEO of Novell Corp.

There is a corresponding press release:

Schmidt was recruited from Novell to build Google’s corporate infrastructure, guide its rapid growth and manage product development using his well-seasoned perspective to complement the young company’s needs.


(Media-Newswire.com) – PHILADELPHIA –- Eric Schmidt, whose 28-year career as an Internet strategist, entrepreneur and developer of innovative technologies was capped by his selection as Google chairman and chief executive officer in 2001, will deliver the commencement address at the University of Pennsylvania on Monday, May 18.

A former Novell employee has just become the CEO of AxisPointe.

Latimer has also previously served at Altiris–which was acquired by Symantec in 2007–as well as WordPerfect, Novell, PowerQuest, and Legato. AxisPointe is a developer of web-based software for managing facilities planning and post-construction customer service.

Sean Michael Kerner did some correspondences with Novell’s staff. He picked up a comment from Justin Steinman.

“It’s great that the U.K. government is embracing open source software. However, I don’t expect the UK government to make the transition to 100 percent open source overnight,” Justin Steinman, vice president of solution and product marketing at Novell, said in an e-mail to InternetNews.com.

Sean also had a much longer talk with Markus Rex, who is back to SUSE and Novell after some time at the Linux Foundation. From the interview:

It’s not all about the code in the Linux ecosystem. Any Linux project needs leadership. Markus Rex is one such leader.

For most of the last year, Rex was the CTO of the Linux Foundation, on loan from his employer Novell. Now, he’s back with Novell, where he is responsible for Novell’s open source and open platform technologies, including SUSE Linux Enterprise. Rex has been working at SUSE Linux since 1999.


Q: Talking about your position at Novell, what’s your role and what’s the mission now?

This is a step back into something I’m very used to as compared to something that was totally new.

If we look at the state of Linux at Novell, Linux is certainly a core component of Novell’s strategy.

Luboš Luňák, a Novell employee who builds SUSE, received some fame from KDE.

# Age: I always run out of fingers, and I already have my shoes off…
# Located in: Prague, Czech Republic, my chair at home at the moment
# Occupation: Developer at Novell/SUSE CZ


We’ve found a couple more groups or councils where Novell participates. The first is IntraHealth Open, which was described thusly:

IntraHealth Open, whose goal is to improve health care in developing countries, has created an Open Council featuring such open source leaders as Red Hat, The Linux Foundation, GNOME, O’Reilly, and Novell.

There is also the growing family of Liberty Alliance.

The Internet Society (ISOC) has become a member of the global internet identity community Liberty Alliance’s management board. ISOC joins 2009 Liberty Alliance board members from AOL, BT, CA, Fidelity Investments, Intel, Novell, NTT, Oracle and Sun…

Liberty Alliance was mentioned here before.

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  1. pcolon said,

    February 28, 2009 at 8:34 pm


    Novell’s CEO is just in it for the bucks lying to it’s shareholders. Aquiring smaller companies while building debt; Having .not developers infiltrating the open source part of the company, pumping mono, moonshine, etc., it’s only a matter of time before the microsoft choirboys mutanize SLES into MS-SLES.

  2. Roy Schestowitz said,

    February 28, 2009 at 8:48 pm


    The following was posted some hours ago:

    Does Microsoft still need Novell?

  3. pcolon said,

    February 28, 2009 at 8:59 pm


    Maybe to continue it’s pretentious facade of ‘interoperability’ to try and dodge antitrust-anticompetitive charges.

  4. Roy Schestowitz said,

    February 28, 2009 at 9:01 pm


    It’s just one advantage among many.

  5. suresh said,

    March 1, 2009 at 1:06 am


    Time to hang the board: “Not Well.Being treated by Dr.M$”

    Which is the worst? The decease or the doc.

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