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Novell's Uphill Comeback Trail

It has a strong Linux strategy, a loyal customer following, and solid new product offerings. Can Novell rise from the ashes of NetWare to reclaim its former leadership status?

Once upon a time, Novell ruled the networks. In the early 1990s, 70 percent of corporate networks ran on the NetWare OS. Then Windows Server NT came along and won customers over with its ease of use and interoperability with other Microsoft software. But Novell isn't exactly sitting idle--it's coming back with a vengeance, armed with a new set of product offerings and looking to recapture some of its old glory.

Over the past few years, the company has been executing an aggressive strategy to try to catch up to and perhaps exceed Microsoft and open-source competitor Red Hat. Whether or not it can stage a full comeback--or at least win respectable market share--will depend on its ability to sell and market its Linux applications and SUSE Linux distributions, build on its identity management software, and stanch the flow of departing executives.

OPEN MOVES

There's no question that Novell's open-source initiatives have been appropriate and necessary moves. As NetWare slowly fades away and U.S. companies are at least evaluating Linux, rewiring its products for Linux should help Novell hold on to its existing customer base and win over Unix users.

To briefly recap Novell's open-source efforts, the company bought Ximian, a maker of desktop and server applications for Linux, in August 2003, gaining it Linux developers and solutions as well as sponsorship of two open-source projects: GNOME, which has produced an open-source GUI and productivity applications for the desktop; and Mono, an open-source platform for running Microsoft .NET applications. In January 2004, Novell acquired European Linux vendor SUSE Linux and became the only world-wide source (with a world-wide support staff) for Linux in the enterprise. In April of this year, the company rolled out SUSE Linux Professional 9.3 for home PC users, which comes with 3,000 open-source applications, including OpenOffice, the Firefox Web browser, e-mail, and IM. OpenOffice improves with each new version, and some think it's already ahead of Microsoft Office in its feature set. So far, compatibility is adequate. For example, the word processing module of OpenOffice, Writer, can read Word files and save documents in Word format.

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