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04.23.09

Novell’s Business Strategy Called “Murky, Messy”

Posted in GNU/Linux, IBM, Microsoft, Novell, SUN at 11:46 am by Dr. Roy Schestowitz

Tractor tyre trail

Summary: Comparison between Sun’s vocation and Novell’s

WHEN Novell had approached Microsoft (not the other way around), it soon invented software patents as a business model for offering added value to open source software. Sam Dean, inspired by Matt Asay, compares the strategy of Sun to that of Novell and he has hardly any good things to say:

Give people useful software for free, charge reasonable prices for the support they’ll need, and grow the business. Novell and Sun, by contrast, have both engaged in many murky, messy business strategies that have nowhere near the simple elegance of Red Hat’s model.

From Asay:

Red Hat is an open-source company, while Novell is not, as Novell’s CEO and CFO both emphasized in Novell’s most recent earnings call. Sun, for its part, was desperately trying to reinvent itself as an open-source company, but struggled to do so given the weight of its declining hardware businesses.

[...]

Indeed. The problem for Novell is that this strategy, which started back when i was still with the company in 2003, has never really worked. While I agree that some mixture of “proprietary” value-add and open source is critical to ensuring community and corporate success, I believe Novell has approached open source in the wrong way, though its strategy is understandable given the legacy it continues to have to service

Novell — more than Sun, according to a survey — was not expected to survive this year. But who might be a suitable suitor for Novell given that it’s so heavily tilted towards Microsoft? Could IBM use the money it saved (prospective Sun acquisition) and scoop up Novell for a much lower value instead? That would guard it from UNIX lawsuits like SCO’s. On the other hand, it’s so satirical and it would hardly make business sense.

Who might be an acquirer of Novell then? Who would benefit from its software patents portfolio, its aging software, and the semi-functional imitations (me-too-ware) of Microsoft software?

“[The partnership with Microsoft is] going very well insofar as we originally agreed to co-operate on three distinct projects and now we’re working on nine projects and there’s a good list of 19 other projects that we plan to co-operate on.”

Ron Hovsepian, Novell CEO

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A Single Comment

  1. JohnD said,

    April 23, 2009 at 7:32 pm

    Gravatar

    Thanks for including this bit:
    “While I agree that some mixture of “proprietary” value-add and open source is critical to ensuring community and corporate success…”
    Which is what I’ve been saying for a while now. Nice to see I’m not the only one who thinks this way.

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