Novell's Time Has ComeNovell's Time Has Come

Novell has stumbled down this road before, but this time the landscape is different. By acquiring German Linux distributor SuSE, Novell is indeed trying to shake up the IT establishment for the second or third time in its checkered history. But now its market timing is right on, and it has the people, technology and financial backing to ride Linux into the enterprise. It's even proceeding with uncharacteristic poise, ingratiating itself with the open-source community while staying out of Microsoft's face. Now if Novell can only overcome its penchant for snatching defeat from the jaws of victory. With NetWare on the decline, Novell has spent much of the past decade trying to herd its customer base to some other software environment. First it acquired the rights to Unix System V in a failed attempt to adapt its file, print and other network services for a mature operating system developed by formidable competitors. Then chairman Ray Noorda led Novell on a collision course with Microsoft as a vendor of desktop applications, only to be crushed by its omnipresent, deep-pocketed rival. As the Internet took off, a kinder, gentler Novell snuggled with upstart Netscape to port the industry's leading intranet-development environment to NetWare. Meantime, it tried to coexist with Microsoft by porting its directory to Windows. Both efforts stalled as Netscape faded away and Microsoft hustled to market with its own directory.

In each case, Novell was a day late and a dollar short. All the while, though, it still had these thousands of loyal, sometimes fanatical customers who yearned to be led somewhere, anywhere besides Windows. Enter Novell's latest master strategy.

So why should we expect Novell to succeed this time around with Linux?

For one thing, Linux is easier and cheaper for Novell to support than Unix ever was. More important, Novell is at the cusp of the uptake curve, not a year or three behind it. A confluence of market forces--growing frustration with Windows security vulnerabilities, an IT culture that's increasingly averse to costly proprietary alternatives such as Solaris--has enterprises seriously considering Linux for critical applications.

Novell isn't just crashing the Linux party. It's been moving steadily in this direction for three years. Before buying SuSE, whose operations are mainly in Europe, Novell already had about 600 Linux engineers to complement its committed network of resellers and integrators. Novell's eDirectory already runs on Linux, and its Nterprise Linux Services 1.0, due later this year, will bring file, print, messaging, management and portal services to the kernel. Its August acquisition of desktop Linux specialist Ximian has acclimated Novell to the open-source community.

All the while, Novell has resisted the temptation to make this a Noorda-esq grudge match with Microsoft. Although SuSE's Linux distribution is ultimately a threat to Microsoft's server hegemony, Novell (for now) is targeting upstart Linux distributor Red Hat as its chief competitor. It helps that IBM has invested $50 million in Novell, giving Novell's aspirations additional legitimacy, and giving Novell the financial muscle it'll need to hang tough as enterprises make up their minds about Linux.

So what could go wrong? Lots. The likes of HP and IBM (and even Sun) could run with Linux on their own. Microsoft might also wake up to the fact that Linux is indeed serious competition, an operating system to be "embraced and extended" rather than pooh-poohed. Or Linux could remain a marginal enterprise operating system, OK for the geeks to play with from time to time but not for critical apps.

One senior Novell exec calls the NetWare faithful the "love group," as loyal as puppy dogs. But even puppies grow up. Novell knows this. This may be its last chance to keep the love alive.