EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS

11.29.10

Novell’s Last Week – Part I: Novell Was Bought by Microsoft, Argue Pundits

Posted in Microsoft, Novell, Patents at 7:20 am by Dr. Roy Schestowitz

Steven J. Vaughan-NicholsSummary: Opinions and takes on the Novell-AttachMSFT agreement, which puts ammunition in Microsoft’s hands

Boycotting Novell was the original purpose of this Web site, so we stay dedicated to Novell as a topic and today we will provide detailed coverage based on the past week’s news. We have gone through hundreds of articles and collected some of the best of them.

When it comes to Novell’s sale, Techrights offered a lot of coverage one week ago (around a dozen posts and a dedicated episode of TechBytes), which was the last week Novell made the headlines in its transitory state. Novell will no longer report results as a public company and it is already being turned into a fur ball of code and marketing, which will be sold to Microsoft-bound entities 4 years and 20 days after selling out to Microsoft.

“We have gone through hundreds of articles and collected some of the best of them.”As usual, IDG has its hands on a lot of the coverage. Centralisation of reporting power is never a healthy thing, but getting a perspective from many sources (even biased ones) is the way to understand the different sides and then strike balance. First of all, Network World staff (IDG) wrote some Novell history and Paul McNamara who was among the group writing it concentrated on Eric Schmidt when he published “Why any great career move should be known as ‘a Schmidt’”. For those who do now know, Schmidt was once Novell’s CEO. As McNamara put it: “The thought arose as I compiled a Novell corporate timeline to accompany our coverage of its acquisition by Attachmate. Schmidt was CEO at Novell in 2001 when he was asked to and did indeed take the top spot at Google. The rest is not only history but has prompted me over the years to wonder: Has anyone in any field ever made a better career move?”

Also see the article “Pull a ‘Schmidt’ and Jump at Opportunity” and this memory of WordPerfect.

Remember WordPerfect back in the 90′s? That went bust thanks to a crumbling relationship between Novell and the WordPerfect executive team. Poor relationships can bring down entire products, and even business empires.

Novell has an extensive legacy as a Microsoft rival, so it cannot be easily picked up by Microsoft. However, Novell seems to have found an antitrust loophole and Steven J. Vaughan-Nichols (SJVN) involuntarily shows that Techrights‘ “Boycott Novell” was right on target all along. Writing for IDG, SJVN published the article “Dark horse Attachmate buys Novell, Microsoft helps”. He says that “VMware wanted to buy Novell, but the virtualization company didn’t want to buy everything that Novell’s board wanted to sell. At the same time, Microsoft had made it clear that it hated the idea of VMware, a Microsoft rival, ending up as Novell’s owner. The result was that Attachmate bought Novell for $2.2 billion while Microsoft paid $450 million for as yet unnamed Novell intellectual property.”

But here comes another post from SJVN. This IDG blog coverage from a longtime supporter of Novell bears the headline “Who really bought Novell? Microsoft.”

Who really bought Novell? Of course, I know that Attachmate is the company that’s on record as purchasing Novell for $2.2-billion, while Microsoft shelled out $450 million for some Novell intellectual property. But tell me, where did Attachmate get $2.2-billion? Could it have been Microsoft? I think so.

I’ve covered Attachmate over the years, so I knew who they were when the news broke that Attachmate had purchased Novell. What I couldn’t see was where the heck they had gotten the money for the deal. Attachmate’s main business over the years has been software terminal emulation. That’s a business line that’s been dying ever since the Web came along in the early 90s.

[...]

Instead Microsoft used Attachmate as a proxy to take Novell off the operating system chess board as an independent Linux company. At the same time, it retains enough direct and in-direct control of Novell and its intellectual property to put them into play if needed to put trouble into Red Hat, Android, or Ubuntu’s paths.

I don’t have a bit of proof for this mind you. Both Attachmate and Microsoft are being remarkably close-mouthed about what exactly they’ve bought and what they plan for their pieces of Novell. What I do have is decades of watching Microsoft bully its opposition. From that viewpoint, this seems like a logical Microsoft move.

“Novell is dead and Microsoft has eaten its heart” says another opinion piece from IDG and the official IDG news coverage is a lot more toned down and objective (“Microsoft purchasing 882 Novell patents”). Here is an update and discussion at LWN, which has some very insightful contributors.

Update: Novell’s 8K filing is available with a bit more information. The “certain intellectual property” is 882 patents. There is also an escape clause for Novell should somebody come along with an offer for the company that includes buying the patents.

Reuters has an interesting blog post titled “Deals wrap: Novell deal a Microsoft maneuver?”

Sam Varghese, a longtime Novell critic, says that “Microsoft buys insurance from Novell” (there are more posts that go along those lines, especially in blogs).

There’s no escaping the fact that Microsoft got those software patents from Novell. “Red Hat had “no comment” about the Microsoft purchase of the Novell patents,” wrote the person who reported for IDG on the patent sale. There’s an ongoing debate as to what Microsoft targets with those patents. Some say it’s Linux and others say it’s some of Novell’s proprietary software competitors. Simon Phipps writes: “That’s reading further than the data permits. Best guess I have seen so far is WordPerfect and PlateSpin are the targets.”

Matt Asay, Canonical’s COO (and formerly of Novell) argues that Microsoft and Attachmate were not Novell’s destiny. It’s a decent article (except the Mono boosting) and it suggests that Microsoft did not get all of Novell’s patents, just many of them

Under Hovsepian’s watch, Novell cozied up to Microsoft, gaining short-term revenue but losing long-term leadership points as Novell distanced itself from the open-source community that has supported Red Hat’s rise to a $750m Linux and middleware juggernaut. More recently, Hovsepian managed to spend eight months shopping Novell after an Elliott bid, only to eke out six per cent more from Attachmate. Was it worth it?

No, but apparently there simply wasn’t much interest in buying Novell, as The 451 Group’s Brenon Daly points out:

[B]eyond all of the complications around matchmaking is the fundamental fact that Novell just isn’t that attractive, regardless of whatever business we look at inside the company. Each component of its revenue (license, maintenance/subscription, services) has dropped so far this year, which is part of the reason why Novell has come up short of Wall Street expectations every quarter this year. Overall, sales have dropped six per cent in 2010, and current projections call for Novell’s revenue to decline next year, too. So as we look at it, the board probably did a fair job to get Novell valued at $1.2bn (net of cash), which works out to basically 1.5 times sales.

He should not have mentioned Mono the way he did because it is bound to make people worried about Ubuntu’s direction with Mono. But that’s the subject of part II in this series.

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

What Else is New


  1. Links 1/9/2014: Poettering on systemd, ITNews on DBMSs

    Links for the day



  2. Moving Away From Windows to GNU/Linux and the Abandonment of Windows as the Modest Proposal These Days

    Morale of GNU/Linux and an embrace of GNU/Linux is very high, despite recent propaganda from Microsoft MVPs and boosters (primarily security-themed and Munich-themed FUD)



  3. Korean Press Slams Microsoft Over Patent Extortion Against Linux/Android as New Abuses Resurface

    Harsh words from the national press of South Korea as Nokia's role in Microsoft's anti-Linux tactics becomes more apparent



  4. More Good News About Patents and Their Demise in the United States

    A roundup of news about software patents and patent trolls in the land where these thrive



  5. Links 31/8/2014: Linux 3.12.27, Akademy 2014

    Links for the day



  6. Links 30/8/2014: Jailhouse 0.1, *buntu 14.10 Beta

    Links for the day



  7. Links 28/8/2014: Many New Games, CTO of Red Hat Steps Down

    Links for the day



  8. We Are Gradually Winning the Battle Against Software Patents

    The once-elusive war on software patents is finally leading to some breakthrough and even the Federal Circuit reinforces the trend of software patents' demise



  9. Free/Open Source Software (FOSS) Companies Versus FOSS Moles (VMware, Sonatype, Xamarin)

    A look at three entities which pretend to be pro-FOSS but are actually FOSS-hostile and very much determined to replace FOSS with proprietary software



  10. Links 27/8/2014: GNU/Linux in Space, China, LinuxCon

    Links for the day



  11. FUD Against Google and FOSS Security Amid Microsoft Windows Security Blunders

    In the age of widespread fraud due to Microsoft Windows with its back doors there is an attempt to shift focus to already-fixed flaws/deficiencies in competitors of Microsoft



  12. Microsoft Spin Watch: IDG Turns to More Microsoft Propaganda, Hires Microsoft Boosters

    Media in Microsoft's pocket is telling Microsoft's lies and deceives the public for Microsoft's bottom line



  13. Microsoft's Massive Tax Evasion Becomes Better Known

    A new report about Microsoft's admission that it plays dirty tricks with tax (sometimes using moles in government) is increasing awareness of Microsoft's criminal aspects



  14. Links 25/8/2014: China's Linux Revolution Imminent

    Links for the day



  15. Links 24/8/2014: GNU/Linux Specialisation and Benchmarks

    Links for the day



  16. Links 23/8/2014: GNU/Linux Growth

    Links for the day



  17. Microsoft-Funded Attacks on Android Security and Patent/Copyright

    A look back at examples of people who smear Android and are receiving (or received) money from Microsoft



  18. Blowback in Chile and Munich After Microsoft Intervention

    Microsoft's attacks on the digital sovereignty of countries involves lobbying, corruption, an attack on standards (e.g. ODF), an attack on FOSS policies, and even an attack on accurate reporting (truth itself)



  19. The End of Microsoft is Nigh

    A look back at a tough year for Microsoft and a not-so-promising future



  20. Links 22/8/2014: Linux Foundation LFCS, LFCE

    Links for the day



  21. UPS Burned by Microsoft Windows, Gives Away Massive Number of Credit Card Details

    UPS is the latest victim of Microsoft's shoddy back door with software on top of it (Windows); attempts to blame FOSS for data compromise actually divert attention from the real culprit, which is proprietary software



  22. Microsoft's Funding of ALEC and Other Systemic Corruption

    Microsoft role in writing of laws by proxy, via groups such as ALEC



  23. Microsoft is Still Preying on British Taxpayers, Playing Politics

    Some news from the UK showing how Microsoft uses politics to extract money out of taxpayers, irrespective of their preferences



  24. Microsoft's Patent Troll Intellectual Ventures is Collapsing as 20% of Staff Laid Off

    More good news regarding the demise of patents as Microsoft's leading patent proxy is collapsing more rapidly than anyone ever imagined and software patents too are collectively doubted



  25. Links 21/8/2014: Conferences of Linux Foundation, Elephone Emerges

    Links for the day



  26. Links 20/8/2014: Linux Event, GNOME Milestone

    Links for the day



  27. Corruption Watch: Microsoft Lobbying Designed to Kill Chile's Free Software Policy and Promote Microsoft With Subsidies, More Dirty Tricks Emerge in Munich

    icrosoft is systematically attacking migrations to GNU, Linux and Free software, using dirty tricks, as always



  28. Vista 8 Such a Disaster That Even Microsoft Cannot Cope With It, Vapourware Tactics Start Early

    Microsoft's Windows-powered services are failing and Windows gets bricked by Microsoft patches, whereupon we are seeing yet more of Microsoft's vapourware tactics (focusing in imaginary, non-existent versions of Windows)



  29. On BlackBerry and Other Patent Trolls

    A roundup regarding patent trolls, starting with the bigger and latest joiner, BlackBerry's new patents apparatus



  30. Links 19/8/2014: Humble Jumbo Bundle 2 Betrayal, Mercedes-Benz Runs GNU/Linux

    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