Did Novell Just Die?
Okay, the headline is a bit dramatic. But the Sun-MySQL business combo makes The VAR Guy wonder: Will Novell wake up and start buying open source application providers … or is Novell doomed to repeat the exact same mistakes it made in the 1990s? Alas, Novell in 2008 looks a lot like Novell from a decade ago. That’s not good. Here’s why.
In the early 1990s, Novell NetWare held nearly 70 percent of the network operating system market. But that market share plummeted because NetWare missed out on the huge server application wave. While Microsoft positioned Windows NT Server to run SQL Server, Exchange Server, Oracle, Lotus Notes and more, Novell was clueless about the application space. Anybody else remember Novell’s IntraNetWare and Novonyx embarrassments? Ouch.
Here we go again. While Red Hat — and now Sun — expand from the operating system layer into the (A) middleware layer or (B) application layer, Novell once again is an also-ran. SuSE Linux is a nice platform with decent growth prospects, but operating systems are yesterday’s news. Novell needs to move up the software stack — fast — to stay relevant.
Similar to how Microsoft built its BackOffice business in the 1990s, Novell needs its own suite of server applications for SuSE Linux. Sun beat Novell to the punch with the MySQL acquisition. Stellar move by Sun, since MySQL is the de facto database for most Web 2.0 and open source application deployments. Big setback for Novell, since much of the application market begins with databases.
Of course, Novell still has room to maneuver. Plenty of open source application providers remain independent. But you’ve got to wonder if anyone running an open source company would be willing to sell to a Novell that has so tightly hitched its wagon to Microsoft.
Perhaps Novell could sell itself — though such statements have been made about the company ever since former CEO Ray Noorda retired in 1994. Rumored buyers over the years have included Sun, IBM and Oracle, just to name a few. But The VAR Guy doesn’t see that happening. Alas, open source continues to represent a small fraction of Novell’s overall revenue. Novell also has a nice footprint in the endpoint security market and the identity management sector. But there again, sales are a fraction of Novell’s overall revenue.
Novell ain’t dead yet. But the flesh wounds are starting to add up. It’s time for the company to get in the applications game.