Comments

• JohnD

  2009-12-05 22:50:50

  I was waiting to see how long it would take you to once again draw an inaccurate conclusion on Novell's financials. For those readers who don't know accounting Novell's $279 million loss is strictly paper, not monetary. The charge to goodwill/intangible assets simply means that Novell knowingly overpaid for some of the businesses it purchased. Most likely some of it was tied to the Platespin takeover. Novell probably paid over market price for Platespin with the hopes that by joining the companies they would make more money than Platespin could make on it's own. Companies can use this method to shelter income from taxes. If you take a closer look (based upon some of the above quotes a few people have) you'll notice that Novell has: 1. Increased it's margin (which means they make more money off of every sale). 2. Still has over 900 million in cash in the bank. 3. Reduced it's outstanding debt. 4. Has over 600 million in deferred revenue (which is money that is owed via contract or has already been paid to them, but can't claim as income until they have rendered the actual service). Novell is hardly a company that is "going down". In fact, they are well positioned to make a lot of money when the economy turns around.

• Roy Schestowitz

  2009-12-05 22:55:23

  You ignore the fact that Novell continues to lose money and shrink in size.
  
  As disclosure, you might point out that you have vested interests when it comes to Novell.

• JohnD

  2009-12-05 23:08:03

  Yeah along with just about every other company in the world right now, hardly an indictment of the company as a whole. If you truly understood financials you'd know that operating margin is a better indication of how well a company is doing than gross sales in an economy that is down on a global scale. Hell Toyota posted it's first loss this year if I'm not mistaken. I seriously doubt they will go under completely anytime soon. As for disclosure: Yes I'm a CNE, but most of my business is supporting IBM products because I'm a PCLP in Notes too. Oh and I own a whopping 50 shares of Novell stock that was given to me as a gift from my stepfather who passed away last week. So even if Novell goes under I'll be doing just fine. I'm far more interested in making sure that anyone who reads posts like this have a better understanding of where Novell is financially.

• Roy Schestowitz

  2009-12-05 23:12:38

  I'm sorry to hear about your father, John. Thanks for the contributions which add balance.

• JohnD

  2009-12-05 23:28:36

  Thanks for your sympathies Roy. As a CNE I'm precluded from casting any Novell product in a bad light, but that doesn't mean I have to agree with everything they've done either. I was not happy when they announced the M$ deal or the discontinuation of Netware, but they were trying to make the best business decisions they could. I'm not wild about the decisions, but they are done and it's time to move on. I'm not happy about what M$ has done to the market for consumers or providers. Personally I'm sick of dealing with M$ brainwashing that everything has to be Windows/Exchange etc. I don't think Novell is quite as cozy with M$ as you believe and I still think having Novell as a player in the IT realm will do more to promote FOSS than to hurt it. We won't make serious inroads against Billy & Co. without getting the big companies on board.

• Roy Schestowitz

  2009-12-05 23:44:42

  Novell had some other possibilities. The bulk of the revenue comes from old(er) products, so the Microsoft deal was not a necessity. Novell just looked for something to trash Red Hat with ("IP").

• JohnD

  2009-12-06 00:09:32

  Revenue from the products was falling even before the M$ deal, Novell did the smart thing and went in a new direction with an OS that was gaining popular support. It was getting easier to find Linux drivers for hardware than it was to find Netware drivers. As much as I hate to say Microshaft had already done it's damage. Most companies were abandoning Netware in favor of Windows - Novell had to go in a different direction. Companies had already sunk tons of money into migrating from Netware to Windows - they weren't going to spend all that money over again on a new OS. Linux gives them a low cost/risk option to try. If it works, great. If not, you're not out a whole lot of money. I think the deal was more about gaining a perceived advantage over other Linux vendors then specifically trashing Red Hat. While most Linux supporters agree that M$ probably doesn't have a legal leg to stand on, most business bigwigs don't know shyte from shinola when it comes to FOSS. As an example of the stupidity rampant in companies I'll share this story with you. Back during the dot com boom I got a job with Knoll Inc. I had the "privilege" of sitting in on a strategy meeting one day where they were talking about using MS IIS and SQL for the website. This was a company that invested heavily in AS/400 & Domino prior to the dot com stuff. They had access to the Domino webserver and DB2/400 and were seriously considering putting M$ crap in place because of it's supposed "benefits". That is the level of stupidity that must be overcome. Like Ron White says - you can't fix stupid.

• Roy Schestowitz

  2009-12-06 00:30:46

  I am still not sure how Microsoft's patent deal adds much legitimacy to Linux. That's just a talking point, IMHO.
  
  When you sign a patent deal about some unknown patents I think it may only Illegitimatises the platform.

• JohnD

  2009-12-06 00:54:16

  It doesn't, but unfortunately the people making the business decisions are more concerned with money and risks then they are with making the right decisions. There was a time when the saying was - No one ever got fired for buying IBM. Now you substitute M$ for IBM. The decision makers aren't IT people so all they know is the little they hear in the popular press. None of them will buy anything that carries the slightest risk of a lawsuit no matter how baseless the suit may be. Microsoft knows that no VP is going to risk their job over software, so they push the FUD. Does it suck? Sure, but that's what happens when you put politicians in charge and most execs are politicians. I understand where you're coming from with regard to the deal and to a certain extent I agree with you. I also look at the deal as doing 2 important things: 1. It raises awareness of Linux. 2. It's sucking money out their bank account. To a certain extent M$ shot themselves in the foot by doing the deal because they accepted at least one version of Linux as being worthy of use and their support. With less money they will have to focus their efforts on a smaller number of things - which leaves more room for competition. Only time will tell how all of this will play out, but right now I think M$ is on the losing end.

• Roy Schestowitz

  2009-12-06 01:16:50

  Microsoft has gotten a lot from the money it gave Novell.
  
  .NET, Silverlight and patent FUD promotion are just a few examples. We actually foresaw this 3 years ago.
  
  There are many other examples.

• JohnD

  2009-12-06 01:41:18

  Microsoft has been using FUD from day one, the Novell deal didn't have an impact on their use of FUD. If they had never made the deal MS would still be selling the patent FUD. .NET existed before the deal and they probably would have developed Silverlight in the absence of the deal. Silverlight is more about beating Flash than anything else. The only thing MS might have gained is an additional platform for those things to run on. We both know that no hard core Linux developer is ever going to touch those things unless they have no other choice i.e. their job depends on it. Linux coding is too hard for most Windows devs so they'll never go the Linux route unless they have to. The only people it will affect are ones like me who are in between. The most import thing that gNote can show people is that you aren't locked into any development tool etc when working in the FOSS realm. Microsoft is a magician and magic is all about misdirection. Microsoft has most of the FOSS community focused on what they see are direct threats to the community, while they ignore the indirect and far more destructive ones.

• Roy Schestowitz

  2009-12-06 02:08:23

  You have just reminded me to write about Gnote tomorrow. There is a new release.

• Roy Schestowitz

  2009-12-06 02:09:56

  Regarding "programming for Linux", given the right tools (e.g. Java, Qt), this should not be an issue. Cross-platform is handled at a different layer.

• JohnD

  2009-12-06 02:25:35

  I think you misunderstood my linux programming statement. Probably the worst thing Microsoft has done to IT is to "dumb it down". You no longer have to understand what's going on at the most basic levels to write a Windows program. This is part of what doomed Netware. You had to know what you were doing in order to write a NLM, not true of a Windows program. Any numbnut with VB can crank out an app. Of course that app can also take down the machine because it's not coded correctly. It's true that Java, Qt, etc make it a lot easier to code on Linux, I'm not sure that's a good thing. Most Linux tools have package and/or kernel dependencies that you don't have to worry about on a Windows box. Most Windows devs and admins are lazy, they rely on the tools/systems to tell them what's going on. When the tools fail - they are lost. Linux requires you to actually expend some effort to learn how things work - something most people don't want to do.

• Roy Schestowitz

  2009-12-06 02:37:15

  This is true. Well, with the rise of "Linux shops" like Google and Facebook, the latter type will shine and the former evolve or perish.

• wallclimber

  2009-12-05 17:36:15

  I'm very curious to see what happens to Novell when their 5-year patent deal with Microsoft expires. Am I correct that there are only a couple of years left? It seems likely that Novell will be in a very weak (maybe even desperate?) negotiating position by then. Doesn't look like a happy future for the company.

• Roy Schestowitz

  2009-12-05 19:15:42

  By that stage, even Novell customers will not be allowed to use "Winforms", which has already infiltrated many GNU/Linux distributions.