Novell: Open-Source Software Champion update from November 2003

Novell buys SuSE Linux and Ximian, IBM invests $50 million in Novell, and SCO sues everyone who ever looked at Linux. What's it all about?

First, despite the denial of Novell vice chairman Chris Stone, Novell is again setting itself up to compete with Microsoft from the desktop to the server.

Second, large software vendors don't seem to be putting much stock in SCO's Unix license agreement violations lawsuit--and Novell is banking on its immunity from prosecution because it sold Unix to SCO in the first place. Third, if you're serious about Linux in the enterprise, you may be a serious Novell shop in the next few years.

No mainstream software vendor has aligned its future with the fortunes of enterprise Linux as firmly as Novell has. From replacing the NetWare kernel with the Linux kernel to providing Linux-based security middleware and offering Linux desktops with access to Microsoft Exchange, Novell is doing the best job of putting its money where Linux is. Do Novell customers care? Probably not, because they were happy with the old Novell. The Linux initiatives were designed to attract a new kind of customer, one that Novell needs desperately.

Both IBM and Novell have made significant investments in Linux and open-source software over the past few years. But it's easier to understand Novell's interest than it is to understand IBM's investment in Novell. The most interesting analysis we've heard comes from Chris Barton, IT editor at The New Zealand Herald. In 1995, Novell sold Unix to SCO but retained some intellectual property rights as well as the right to waive potential violations of the Unix license. Barton suggested that IBM may be hoping $50 million buys it immunity from SCO's lawsuit. SCO, however, is now threatening to sue Novell for allegedly breaching a noncompete agreement.Whatever the outcome, you can expect Novell to be a significant player in the Linux arena. The big question is, how many customers will pay to see that show?