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The Novell/Microsoft Deal Dissected

A regular reader of this site, MattD, has taken a look at Novell's FAQ about the Microsoft deal. His analysis is worth extra attention. The FAQ is by no means new, but knowing what we know 9 months later, the intents are transparent. MattD's words are highlighted in red.

I found the language of this FAQ quite revealing. Please note how often the word Linux and SuSE are used interchangeably throughout this document. Below are a few quotes that I felt spoke volumes about how they wished to penetrate the market at the cost of Free and Open Source Applications and OSes.

“Microsoft and Novell provide patent coverage for each others customers, giving customers peace of mind regarding patent issues.”

“customers of SUSE Linux Enterprise know they have patent protection from Microsoft in connection with their use of SUSE Linux Enterprise”

“The patent protection offered by Microsoft applies to ALL customers who subscribe to a SUSE Linux Enterprise product. It does not matter if you purchased SLES or SLED, if you bought it directly from Novell, from a reseller, from a distributor, or acquired it via a coupon from Microsoft. If you have a current subscription to SUSE Linux Enterprise, then you are covered by the Microsoft patent protection. Microsoft has provided a covenant not to assert its patent portfolio directly to customers who have purchased SUSE Linux Enterprise from Novell.”

“While some future scenarios may not be included, we have established a working relationship and structure to have conversations about those issues as they arise.”


The statement above has additional negative value as more and more Microsoft related technology enters Linux. This site has spoken about GNOME and MONO. I also think that Microsoft’s attempt to penetrate the server market, which Linux controls, is a motivating factor with .Net making headway into Linux.

“Novell believes customers with heterogeneous networks are best served by an **independent** operating systems vendor like Novell”


Above - independent is used incorrectly as they have relied on efforts by too many people over too many years who wanted nothing more than avoid this disaster.

“In terms of a possible Oracle move to offer support for SUSE Linux Enterprise, Novell believes customers with heterogeneous networks are best served by an **independent** operating systems vendor like Novell”


The statement above was in answer to Oracle offering support for Red Hat. If Oracle intends to support Novell, I haven’t heard about it. All I’ve heard is Oracle certifying their apps (DB, etc) on SuSE. If I’m wrong about Oracle, someone please correct me - otherwise it sounds like they are “dropping names”.

“the companies will create a joint research facility and pursue new software solutions for virtualization, management, and document format compatibility.”


Above: This is where OOXML comes into play as well as MS OS virtualization… something Microsoft is making alot of noise about.

“Microsoft will distribute as part of a resale arrangement approximately 70,000 coupons for SUSE Linux Enterprise Server maintenance and support per year so that customers can benefit from the use of the **new** software solutions developed through the collaborative research effort, as well as a version of Linux that is covered with respect to Microsoft’s IP rights.”


Re: Above statement - Proprietary solutions (”new software solutions”), vendor lock-in, IP threats… Typical Microsoft tactics. Coupons are the only area where MS helps Novell by helping it make money in the short-term - their only motivation.

“Novell will also make running royalty payments based on a percentage of its revenues from open source products.”


Above Statement - This is where Microsoft rides the coattails of the efforts of thousands of Open Source developers whose work span an excess of 16 years. They get to make money off Linux without doing a thing. This is a future hedge in case Microsoft OSes fall off the radar in 10-20-30 years. This is also a test to see how effective this plan will be - which is why it’s only 5 years.

“The patent agreement demonstrates that Microsoft is willing to enter into agreements that extend its patent protection to open source customers.”


Above - Incorrect. Protection is for Novell not Open Source Customers in general using competing Linuxes unless they pay unsubstantiated protection money.

“both Novell and Microsoft felt it was appropriate to make this pledge for Microsoft not to assert its patents against the non-commercial community.”

“The terms of the individual, non-commercial developer patent non-assert are on www.microsoft.com/interop. You are covered if you are doing non-commercial open source software development. This includes individual enthusiasts, such as a student or a developer who does work on his own time on a project of personal interest to him.”


The previous two statements above is where they hope to get community support.

“If you are compensated for your development, then your activities are considered “commercial”, and you would not be covered.”


Statement above - This is where Ubuntu, Red Hat and all other commercial efforts (DSL, PuppyLinux, etc) are threatened.

“Under the patent agreement, customers will receive coverage for Mono, Samba, and OpenOffice.org as well as .NET and Windows Server. All of these technologies will be improved upon during the five years of the agreement and there are some limits on the coverage that would be provided for future technologies added to these offerings.”


Above statement - section where OpenOffice is threatened if run on any environment outside of Novell or Microsoft OSes. OpenOffice hits MS directly in their pockets and is considered among their biggest threats.

They go on to discuss their mutual strategy involving Virtualization, Web Services and Document Format Compatibility. This is the lock-out strategy. When the five years are up, I guess it’ll be Linux vs MS… two proprietary OSes. Microsoft FTW.

This protection racket scheme buys Microsoft Five whole years. In this time, Linux can become more fragmented (if Novell is chosen as the distro of choice). Novell has the opportunity to pull into a healthy lead (given MS resources in the press, government, etc) but it can be an Apple type of lead, something Microsoft can battle more effectively especially given Novell’s reliance on MS tech.

Novell, with their newfound reliance on .NET, Office Document “Standards”, Virtualization of MS-OS will make their Linux version an also-ran. Technologies like PHP and Apache are also threatened.

In an article on Information Week, the following point is made:

Novell “posted a $20 million loss in its first quarter and needs to boost revenues. The Microsoft partnership had been doing just that for the company. Novell said that it’s already booked $7.6 million in sales as a result of the alliance and has recorded $338 million in deferred revenue.”

”What’s deferred revenue? It’s money that Novell has already collected for services not yet provided. If its partnership with Microsoft goes poof and it’s unable to provide the services–well, you get the picture.”


Novell was a desperate company and desperate companies (and people) do desperate things… sometimes selling their own souls. The cost… Linux, Open Source, Competition, Choices…

The biggest enemy remains Microsoft. Novell is willingly allowing itself to be used as pawn for short-term monetary gain. Microsoft’s benefits are huge as they continue to infect Novell’s Linux and a number of open source applications with proprietary MS-only softTech. If this continues, Microsoft indeed will have cause to assert copyright claims on some Linux distributions creating a cascade effect.

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