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05.30.09

Microsoft-Sponsored Czech Presidency Fights Google?

Posted in Europe, FUD, Google, Microsoft, Open XML, Patents at 5:18 pm by Dr. Roy Schestowitz

Czech Crowns

Summary: The Czech Presidency is seen promoting Microsoft’s agenda once again

INNOCENT observers might be able to spot anti-Google fronts which are sponsored or created by Microsoft every now and then [1, 2, 3, 4, 5]. Sometimes they may not be related to Microsoft [1, 2], but they are tied to AstroTurfing entities. They try to appeal to innocent minds and thus achieve the objectives of their sponsor/s.

In addition, several times in the past we demonstrated (using evidence) how the Czech EU Presidency was fighting for software patents in Europe and had been helping Microsoft’s OOXML [1, 2]. It’s part of a trend [1, 2, 3, 4].

Now we are finding this report in EurActiv:

EU countries want the European Commission to investigate the economic implications of Google’s book search project amid fears that it will harm the European publishing industry, it emerged on Tuesday (26 May).

EU competitiveness ministers meeting in Brussels tomorrow and Friday (28-29 May) are likely to ask the Commission to launch an investigation into the implications of the project for Europe’s authors, a Czech EU Presidency source told EurActiv.

[...]

But Czech Presidency sources told EurActiv that it was “extremely early to say” whether common judicial proceedings were even a viable prospect.

The entire text is conspicuously biased. The article is mostly ghostwritten based on this source from the Czech EU Presidency. It does not even wish to be identified on the face of it. Who could possibly be advancing this agenda? Is it possible that the Microsoft-funded Czech Presidency has again joined those other fronts which Microsoft set up to attack Google from different angles? This one uses the angle of book scanning, which would make it a case of hypocrisy assuming Microsoft acts as an agent provocateur. Microsoft tried to do exactly what Google does with literature, but it lost the battle and gave up last year. Only months ago Wired Magazine showed that Microsoft used publishers as a weapon against Google.

“Our friends up north [Microsoft] spend over five billion dollars on research and development and all they seem to do is copy Google and Apple.”

Steve Jobs, 2006

More on Novell’s Finances: SUSE and Mono Failures

Posted in Debian, Formats, GNU/Linux, Microsoft, Mono, Novell, SLES/SLED at 4:47 pm by Dr. Roy Schestowitz

Ogg Theora

Direct link

Summary: Contradiction in claims about Novell’s SUSE franchise (business up, still losing money)

Earlier on we expressed skepticism about Novell's SUSE numbers, having found that the company's results were rather poor overall, probably leading to offshoring of operations. Here is a Microsoft fan who covers it (he seldom says anything negative about Microsoft or its allies and he works for Barron’s). It turns out that we were right because now we find a contradiction. While former Novell employee Matt Asay claimed a rise in Novell’s SUSE business, we now find the video above and a headline which says that “Novell’s Linux Business [is] Still Not Profitable.” Does this mean that Novell only counts growth in terms of revenue when it suits it? It must be the black art of non-pedantic statistics. The article goes as follows:

Novell (NASDAQ: NOVL) is managing to grow its Linux business despite a difficult economy, but is it profitable? The answer, according to both Novell’s CEO and its CFO, is not yet.

“We have invested heavily in our Linux business to gain market share and acquire new customers,” Novell CFO Dana Russell said on the company’s quarterly conference call last night. “While the business is not yet profitable, we are making steady progress and plan for it to be break-even no later than 12 to 18 months from today.”

Novell entered the Linux business in 2003 with the acquisition of SUSE Linux for $210 million and Linux desktop vendor Ximian.

Ximian is a problem and a disgrace to Free software, being the type of offshoot which produced a bridge for Microsoft to embrace and extend GNU/Linux in a malevolent fashion. Too bold an accusations? Well, in relation to the article above, Art Cancro responds by asking if Novell will be “Bankrupt soon.” He writes: “I certainly hope that Ximian (who call themselves “Novell” these days) will go bankrupt very soon. They are basically just the Linux division of Microsoft.

“[W]hy on Earth would IBM want a third-class version of .NET, which is just chasing Java’s tail?”In response to this, says another person, “Way back when I used Microsoft’s assembler on a TRS-80, they were the only company that expected users to pay full price for upgrades. At that time I wished they’d go bankrupt soon.

Someone who goes by the name “oldvaxman” calls Novell a “Good Buy”, then stating: “I think Novell would be a good purchase for IBM

We wrote about this possibility on April 1st because the date seemed suitable. It might make some sense, but why on Earth would IBM want a third-class version of .NET, which is just chasing Java’s tail?

Here is a blog item from this morning. It is about the hypocrisy of Mono supporters. It’s primarily about copyrights.

One of the things that bothers me about Novell is there are a few very vocal people pumping out a lot of disinformation. Some of it I have touched on in passing, but I might just try my hand at pointing out one point at a time in a series of posts. Fear my blogging!

Most of the disinformation is in the areas of mono and Moonlight (no surprise there), but I’ll start with what I consider a clear cut case of hypocrisy from another controversial Novell project…

Those who help Mono development merely improve code which is owned by Novell and helps Microsoft. Fortunately, regarding Tomboy, there is a solution in the making. Yesterday Gnote migrated to Squeeze, which means there will be a backport for Debian Lenny users pretty soon.

Novell’s 2009 Q2 Results

Posted in Deception, Finance, Novell at 10:07 am by Dr. Roy Schestowitz

Imbalance

Summary: Revenue is down $20 million, but Novell claims a $15.6 rise (in net)

OUR initial report about Novell’s latest results can be found here. A lot of the mainstream media parroted Novell’s press release and “quick claims”, so little attention was paid to Novell’s problems (for instance, the company has just begun offshoring some more). For completeness, here is some coverage we have not gone through yet.

Ahead of the Results

Early in the month, the Microsoft-centric Barron’s mentioned Novell positively.

Today, only four S&P stocks — Boston Scientific (ticker: BSX), Compuware (CPWR), Novell (NOVL) and Tellabs (TLAB) — would match our screen’s criteria. They’re all under $10, have the requisite debt ratios, and are expected to boost earnings this year, albeit slightly.

Another pro-Microsoft publication, Motley Fool to be precise, wrote the following about Novell:

A few of the big names on the slate on this day are Costco (Nasdaq: COST) and Novell (Nasdaq: NOVL). One of them is projected to post a drop in year-over-year profitability. Can you guess which one? Well, it’s a trick question. Novell is actually supposed to match the $0.06-a-share profit it posted last year. It’s actually Costco and its warehouse clubs, which seem to be resistant to recessions, that is targeted to post a decline in net income.

MarketWatch wrote about Novell’s expected results shortly before they came out and Yahoo added Novell to the list of earnings announcements for Thursday, May 28th.

Novell Inc. /quotes/comstock/15*!novl/quotes/nls/novl is projected to post a fiscal second-quarter profit of 6 cents a share, according to analysts surveyed by FactSet Research.

More coverage:

i. Novell Q2 Earnings Preview

Software service provider Novell Inc. is scheduled to announce its second-quarter results after the bell on Thursday. Wall Street analysts have forecast flat earnings for the quarter while revenue is expected to decline year-over-year.

ii. TheFortuneFinancial.com Initializes Free Analyst Research on SWKS, CSUN, NOVL and ATML

Today, we have asked some of the top analysts worldwide to give us their updated feedback regarding the current market activity and position on Skyworks Solutions Inc. (NasdaqGS:SWKS – News), China Sunergy Co. Ltd. (NasdaqGM:CSUN – News), Novell Inc. (NasdaqGS:NOVL – News) and Atmel Corp. (NasdaqGS:ATML – News).

iii. STOCKS NEWS US-P&G may provide cautious outlook: WSJ

Companies scheduled to report quarterly results on Thursday include: Big Lots Inc, Dell Inc, Novell Inc, and H.J. Heinz Co. Costco Wholesale Corp said third-quarter net profit fell 29 percent.

Results Arrive

Here is the press release from Novell (also in Yahoo! Finance) and the call transcript. Novell’s 8-K arrived shortly later and analyst ratings may have changed, based on Yahoo’s alert. Novell’s PR people promoted the company’s own message, which is always the most self congratulatory. Novell wants investors and reporters to see what Novell shows but not to see what Novell denies or hides. Guess what? It works.

Associated Press covered this uncritically and via MSN came a similar report. They always want to be the first to publish and speed leaves no room for critical assessment. Dow Jones/WSJ was being a little foolish. It only looks at Novell’s net, which is relatievel tiny (it’s about twice the bonus of the CEO) in order to come up with the moronic headline. It says that Novell’s net profit nearly tripled, but then again, had Novell’s profit been just 1 million a year ago, then one would come up with a sensationalist headline like “Novell profit climbs 1500%.” Wow! Wouldn’t that be something? The matter of fact is that, proportionally speaking, these numbers are small and the revenue declined almost by two digits (percentile-wise).

Novell Inc.’s (NOVL) fiscal second-quarter profit nearly tripled, helped by the stronger dollar, as the software company also posted higher margins and a sharp jump in revenue of its Linux-platform products.

MarketWatch uses the same techniques as the Rupert Murdoch press (WSJ) to exaggerate overall claims through selection. It states that “Novell second-quarter profit more than doubles” and Murdoch’s picks that up too (Fox Business).

MarketWatch also re-used some text for in-market reports, such as:

i. Tiffany, Dell, General Motors, Novell, Marvell, Office Depot

Novell Inc. /quotes/comstock/15*!novl/quotes/nls/novl (NOVL 4.20, -0.23, -5.19%) said second-quarter net income rose to $15.6 million, or 5 cents a share, from $5.9 million, or 2 cents a share, earned in the same period during fiscal 2008. Excluding one-time items, the company would have reported earnings of 8 cents a share in the latest quarter. Waltham, Mass.-based Novell said revenue for the period ended in April fell to $215.6 million from $235.7 million. Analysts on average had estimated Novell would post second-quarter earnings of 6 cents a share and $218 million in revenue, according to Thomson Reuters-compiled data.

ii. Tiffany, Dell, Marvell Technology

Novell Inc. /quotes/comstock/15*!novl/quotes/nls/novl (NOVL 4.20, -0.23, -5.19%) said its fiscal second-quarter net income rose to $15.6 million, or 5 cents a share, from $5.9 million, or 2 cents a share in the same period a year earlier. Excluding one-time items, the company would have reported earnings of 8 cents a share in the latest quarter. Waltham, Mass.-based Novell said revenue for the period ended in April fell to $215.6 million from $235.7 million. Analysts on average had estimated Novell would post second-quarter earnings of 6 cents a share and $218 million in revenue, according to data from Thomson Reuters.

iii. Dell gains, Marvel dips after quarterly reports

In the software sector, Novell Inc. /quotes/comstock/15*!novl/quotes/nls/novl (NOVL 4.23, -0.20, -4.51%) stock added almost 4% after the company said its second-quarter net income rose to $15.6 million, or 5 cents a share, from $5.9 million, or 2 cents a share, a year earlier. Excluding one-time items, the company would have reported earnings of 8 cents a share in the latest quarter. Sales fell to $215.6 million from $235.7 million.

More here:

Software service provider Novell Inc. (NOVL) reported adjusted second quarter net income at $29 million or $0.08 per share, compared to $21 million or $0.06 per share in the same period last year. The adjusted results edged out analyst estimates for earnings of $0.06 per share.

Warped Analysis

We have already explained how Novell changes the definition of SUSE revenue as more of its products are migrated to a Linux base. A lot of people totally miss this financial trick of bucket-swapping (Microsoft does this quite a lot too). As such, Matt Asay blindly accepts that Novell’s SLE* business rose by double-digit figures.

The good news? Novell reported Thursday that its Linux Platform revenue climbed 25 percent year over year in the midst of one of the worst recessions in history. Talk about Linux swimming against the economic current.

Are comparable things being measured year-to-year? Is it possible that Novell ‘beefed up’ its “Linux Platform” segment with some more products? Are there any phasing outs or transitions? These questions are only fair. It is worth remembering that Matt Asay used to work for Novell and he publicly admitted that Novell uses these tricks, which are illegal. Novell was even sued for fraud

SJVN had this to say:

As in the past, Novell remains cash-rich with cash, cash equivalents and short-term investments of about $1 billion. Looking ahead, Novell CFO Dana Russell said, in a press conference, that the company’s Linux business’ “profitability continues to move in the right direction.”

If “profitability continues to move in the right direction,” then why did Dana Russell say in this week’s earnings call that Novell plans further reductions? Is that the plan? More reductions? Rather than expansion?

There are tough questions for Novell to address. Never rely on Murdoch’s press to bring them out. The role of the business press is to shelter and glorify businesses, not to challenge them. Remember who owns this press. The media rarely funds itself through subscriptions and it can be burned to the ground if it makes allegations it cannot defend perfectly. Libel laws are a tool of censorship, much like DMCA and copyrights when abused.

“Distrust any enterprise that requires new clothes.”

Henry David Thoreau

More Dirty Deals in Europe Involve Microsoft, Microsoft Lobbies

Posted in Deception, Europe, Finance, Fraud, IBM, Interoperability, Law, Microsoft at 8:43 am by Dr. Roy Schestowitz

Police car

Summary: Microsoft Romania under scrutiny after blind government handouts; Microsoft-centric assault on EIF (European Interoperability Framework) revisited

A COUPLE of days ago we urged Free/open source businesses to legally challenge Microsoft contracts in their country. There is now legal precedence of some kind. It’s developing, still. Over in Romania, there are clear signs of wrongdoing and there is finally a press report about it.

The [Romanian] government has announced it will pay €300 million (£262 million) to a Romanian IT company for PCs and Microsoft software licences for use in education (see Google translation), while also directly paying Microsoft €100 million (£87 million) for software licences to be used in government agencies between 2010 and 2012 (see Google translation). The country is also paying €58 million (£50 million) this autumn for its existing 2004 to 2009 framework agreement.

The problem of contracts that are not tendered properly is rampant across Europe, and wastes public funds that could be better spent elsewhere, says Georg Greve, president of the Free Software Foundation Europe (FSFE). The Swiss government issuing a contract to Microsoft for £8 million a year, without a tender), and cases may be more extreme in Eastern Europe, he said.

“This decision of the Romanian government seems careless and endangers the country’s sustainable economic growth by increasing its dependency on proprietary software and by wasting funds that would have been better used elsewhere, for instance on infrastructure,” said Greve.

There should be legal action here.

In other news, regarding EIF 2, a reader shares with us the following story:

Someone was telling me that EIF 1.0 is not readily available from the main site. I’m not sure which main site they are talking about, but a series of searches shows that there can be some merit in bringing the strong points of interoperability back into the daylight. And point out the ongoing mischief that MSFTers are creating.

People have taken interoperability for granted now for a full generation. Since it goes without saying, no one needs to say it. If no on needs to say it, it goes unsaid. If there is no one saying it, then it is not represented and thus goes away…

Our reader added some very old material from the opponents of open standards, starting with this report which shows how EIF v2.0 is scrutinised by Microsoft's Gartner Group (as usual, Gartner promotes Microsoft and attacks its competition in exchange for money [1, 2, 3]).

There is also this report about what the opposition to open standards has to say. Again, it’s filled with Microsoft lobbies like Gartner and ACT:

The revision process started with the preparation and publication in May 2007 of the Gartner Report, a preparatory study ordered by the European Commission. That report has been analysed but not endorsed by the Commission and the member states who worked on a draft of the EIF new version, according to IDABC.

[...]

Jonathan Zuck, president of the Association for Competitive Technology, took a similar position, adding that the new version risks hurting small start-up companies that rely on intellectual property protection to compete in the marketplace.

Microsoft must have stifled the progress of EIF. Its hired guns, including ACT [1, 2, 3, 4, 5, 6, 7, 8], submitted suggestions that speak about software patents and all sorts of things that lead to confusion and thus dilemma. If EIF is slowed down, then their goal is achieved. IBM, on the other hand, was openly promoting EIF. There was hardly a word from Microsoft, which sent ACT, CompTIA [1, 2, 3, 4, 5, 6] and the BSA [1, 2, 3, 4] to derail this. We wrote about the blunder right here. Our reader calls it “saturate, diffuse, and confuse.”

FUD Warning: Old Lies About the GPL Still Resurface

Posted in Free/Libre Software, FUD, GPL, Law at 8:05 am by Dr. Roy Schestowitz

Steve Ballmer scared of GPLv3

Summary: Tiring disinformation is being spread about the GPL, probably in order to suppress its adoption

SOME company in Redmond (and the likes of it) must be getting very nervous about the most popular software licence, namely the GNU GPL. The amount of FUD against it seems to be rising and this sometimes comes from Microsoft allies like White & Case. We saw this several weeks ago [1, 2] and we are seeing it again in ECT, which lets the likes of Jonathan Moskin drop some disinformation about Free software. Yes, again.

Coincidentally, this morning we received an E-mail warning about this blog post from a prominent legal Web site. Our reader explains:

[Kevin Fayle] writes in 2009 about “test cases” for the GPL:

1) Copyright law is upheld in all countries that have signed the Berne Convention, thus the copyright license GPL is upheld in all those countries.

2) There have been court cases for years where violators have been set straight. However, it would be good to find the first ones and then point them to the blogger in the finlaw post.

This is a terrible myth that we keep seeing year after year. Is this a classic lie whose intention is to be repeated? That GPL was never tested?

we debunked this very specific point back in 2007, in direct response to similar FUD/disinformation, which propagates like a disease. Given some of the documents Microsoft unleashes about the GPL, it does deserve part of the blame.

Former Xandros Director Charged with Third-Degree Conspiracy, End is Near for SCO

Posted in Courtroom, Deception, Finance, Fraud, GNU/Linux, Linspire, SCO, UNIX, Xandros at 7:37 am by Dr. Roy Schestowitz

Debit card

Summary: Criminal charges pressed against William Roseman; SCO hearing canceled and Chapter 7 possibly imminent

IT IS interesting to find just how small a world we live in. Using the Internet, embarrassing news about people would escape almost nobody who pays close attention.

Is it true that one of the key people at Xandros became a mayor? Is it true that he’s accused of third-degree theft? Is this the same Xandros? Yes, it is. A plurality of sources can verify this.

Carlstadt Mayor William Roseman and his former spouse, Lori Lewin, are accused of stealing medical and prescription plan benefits from the borough over the last several years, according to the Bergen County Prosecutor’s Office.

A grand jury indicted the two on charges of third-degree conspiracy to commit theft by deception, third-degree theft by deception and second-degree official misconduct today, May 29.

[....]

Roseman is the co-founder, vice president of finance and director of Xandros, Inc., according to the most recent information available to The Leader.

This would not be the first time that William Roseman finds himself in court. Lindows (later to be known as “Linspire”) sued him and his colleagues about 5 years ago.

Buried in recently published financial documents is the news that Lindows, Inc., has been engaged in a lawsuit with rival and one-time partner Xandros, Inc. since the middle of December 2002. Lindows claims that Xandros failed to repay a $750,000 loan, and that the company and other defendants engaged in fraud and criminal misrepresentation during the negotiations leading up to Lindows’ investment in Xandros.

The information came to light when, on April 20, Lindows, Inc. filed a registration statement with the U.S. Securities and Exchange Commission for an initial public offering (IPO) of common stock.

According to court documents obtained by Newsforge, Lindows and Xandros began negotiations to enter into a strategic relationship in the second half of 2001. Two directors of the venture capital firm Linux Global Partners, Michael A. Bego and William J. Roseman, contacted Lindows executives and suggested that Lindows invest in Xandros, a newly formed entity that had been created by LGP to develop an operating system based on code from Canadian software company Corel. Lindows loaned Xandros a total of $750,000 and received three Promissory Notes in exchange, and the two companies entered into a strategic alliance on November 20, 2001.

[...]

To date, the defendants have largely ignored Lindows’ specific allegations; instead they have filed a motion that seeks to compel Lindows to enter into arbitration, while at the same time staying or dismissing the court action. However, three key defendents — Michael Bego, William Roseman, and LGP co-founder and Xandros Chairman Dr. Frederick H. Berenstein — have now been deposed (interviewed under oath without a judge being present). The parts of their testimony that do not relate to the Xandros motion may be a preview of the defense that they intend to present should the case go to trial.

In their sworn testimony, both William Roseman and Michael Bego maintain that it was their understanding that the funds provided by Lindows were pre-payments towards the revenue-sharing scheme established as part of the Strategic Alliance Agreement (SAA). The strategic alliance was designed to allow Lindows to put Xandros technology into Lindows’ own operating system; in return, Lindows would pay royalties to Xandros, possibly as high as 50% of total operating system revenue.

Is it not ironic that Xandros later bought Linspire (formerly Lindows) [1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11]?

While on this issue of legal circumstances, despite the fact that SCO issues some press releases, its very end might be near. SCO’s bankruptcy hearing is suddenly cancelled.

Tomorrow’s bankruptcy hearing has been cancelled. This is the one that was about signing off on some fees billed to SCO, the one I told you probably was worth skipping. I gather the court agreed. Why pay lawyers to show up for a hearing on something that isn’t opposed by anyone? It’s an unnecessary expense, if the judge is just going to sign, which is what he was certainly going to do. This is a sensible move. The hearing that matters is the next one, on June 15 on whether to send SCO to Chapter 7 or not.

Groklaw takes a look at what liquidation of SCO would involve.

What happens if a company ends up in Chapter 7 bankruptcy? Here’s the overview from Cornell University School of Law’s Legal Information Institute:

Legal matters are not our area, but Groklaw has all the valuable information.

Novell News Summary – Part III: GroupWise, Security, People, and the Demise of SiCortex

Posted in Mail, NetWare, Novell, Servers at 7:22 am by Dr. Roy Schestowitz

Monument Valley, Utah

Summary: The past week’s news about Novell, excepting SUSE

ANOTHER analysis of Novell’s financial results is very near. A major component of it is proprietary software, so this post looks mostly at this lesser-explored part.

Read the rest of this entry »

Novell News Summary – Part II: More Moblin, SLES, and SLED

Posted in GNU/Linux, HP, Novell, Red Hat, Servers, SLES/SLED, Ubuntu at 6:24 am by Dr. Roy Schestowitz

Scary Iguana

Summary: SUSE news with emphasis on Moblin, where most of the activity persists

Moblin

SUSE was mentioned prominently only in relation to Moblin, so it’s probably a good place place to start.

Read the rest of this entry »

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