The Other Side of a Novell Buyout

Last week, Jason Brooks blogged about the rumors that Novell was looking to sell off SUSE Linux to VMWare, and the possibilities such a matchup could create. That was what you might call the “glass half-full” look; I’d like to take a stab at the half-empty side of things. I

Last week, Jason Brooks blogged about the rumors that Novell was looking to sell off SUSE Linux to VMWare, and the possibilities such a matchup could create. That was what you might call the “glass half-full” look; I’d like to take a stab at the half-empty side of things.

I have covered Novell as long as I’ve been in the business of technology journalism, and I’ve held the technical chops of its engineers in high regard for just shy of 20 years, reaching back to the days when I was deploying NetWare as an IT manager. But I’m coming to the conclusion that it’s time for the company to call it quits.

One could say that the company has a pattern of backing the wrong horse; more correctly, Novell’s history is one of sticking with a horse long after it should have gone to the glue factory. For example, NetWare owned the market for print and file services throughout most of the 1990s, but Microsoft’s Windows NT 4 ultimately proved to be a superior application platform as well as a serviceable replacement for file and print. Novell never quite found a way to decouple its pioneering NDS (now eDirectory) directory service from its association with the moribund NetWare, and the Windows-oriented Active Directory quickly became the directory of choice for commercial software. Even today, when Novell has a solid lineup of security tools that use eDirectory and demonstrate its usefulness, it’s rare to find a third party product that communicates with it at any level beyond vanilla LDAP.

When Novell bought up SUSE earlier this decade and began selling its Linux distribution as the logical next step for NetWare installations under the Open Enterprise Server badge, I entertained the possibility that, just maybe, Novell had pulled off a Hail Mary pass. But it seems that you can’t give away SUSE Linux on this continent, and although it’s finally a paying proposition for Novell, its lackluster track record leads one to believe that VMware would be buying SUSE for its engineering talent rather than the installed base.

As for the rest of Novell, under the scenario posited last week, it would be spun off to private investors, but why? It makes no sense to spend money on what is effectively the Chrysler of software companies. It would be smarter (and perhaps easier) to convince an Intel or Symantec to step in and loot the remnants of the Provo powerhouse, which would include (as Matt Asay pointed out in a recent blog post on GigaOM) a substantial portfolio of patents, and in the process salvage the positions of the company’s current shareholders, instead of searching out investors foolish enough to sink their capital into what, by all objective measures, is a money pit.