Without question, open source is one of the most important forces in enterprise IT. Apache is still the reigning champion
of Web server software. Red Hat and MySQL are two of the most-watched software vendors today. And the success of Linux is
such that even Microsoft, once considered the unstoppable juggernaut of the OS market, is being forced to play defense.
The open source model is often said to fly in the face of traditional commercial software development. But now Novell, the
former undisputed leader in proprietary networking software, is banking on Linux and open source to rescue its business from
years of decline. Where once it seemed fated for obscurity, Novell is determined to regain its former status by transforming
itself into one of the industry’s leading open source vendors.
Novell first aligned itself with the open source community when it launched its collaborative development site, forge.novell.com,
in early 2003. But it wasn’t until Novell purchased open source desktop software vendor Ximian in August 2003 that the company’s
new direction began to solidify in the public eye. Then in January 2004, Novell acquired SuSE, the leading Linux vendor in
Europe and the No. 2 player worldwide, after Red Hat.
But even though it seems to be holding all the right cards, Novell faces tough odds. In recent years, tough competition from
Microsoft and dwindling support from third-party developers have caused Novell’s once-loyal base to look elsewhere for infrastructure
needs. Unless it can win back the loyalty of the industry, Novell’s new, Linux-centric message could fall on deaf ears.
LAN leader dethroned
Novell’s fortunes weren’t always so dire. At one time, its name was synonymous with PC networking. The debut of its NetWare
file sharing technology in 1983 came as a revelation. Previously, networking had been an arcane affair, used for connecting
workstations to expensive mainframes and minicomputers. With NetWare, any workgroup could share files and printers using straightforward,
native PC software.
Throughout the 1990s, Novell built on NetWare’s momentum, releasing technically superior products such as NDS — now known
as eDirectory — and the ZENworks configuration management system. Analysts estimate that at the height of its success Novell
commanded as much as 75 percent of the PC networking market. But as the years wore on, its star dimmed.
The rise of the Internet and increasing dominance of Microsoft products such as Windows networking and Active Directory —
among other factors — steadily eroded Novell’s customer base. Seemingly blind to the threat to its core business, Novell made
a series of missteps, including the acquisition of WordPerfect and the Quattro Pro database in a bid for the desktop-applications
market. A revolving executive team and an ongoing brain drain of developers to the competition compounded its woes.
Today, left with less than a 4 percent market share, the former LAN leader teeters on the brink of irrelevance. At Novell’s
darkest hour, open source could be the company’s last, best hope. And yet, company executives resist being labeled.
Back to the source
“No, it’s not fair to characterize us as an open source company, and it’s not fair to characterize us as a closed source company,”
says Novell CTO Alan Nugent. “I don’t know that there’s any particular name for it, but I guess you could call us a ‘mixed-source
company,’ at this point.”
Novell’s strategy seeks to leverage the strengths of both the open source community and its own portfolio of proprietary technologies.
To that end, it has begun porting its entire application stack — including eDirectory and its identity-management and Web
services technologies — to Linux. By the end of this year, Novell plans to release Open Enterprise Server, which will be the
culmination of its efforts to create a unified code base of Novell services for either the Linux or the NetWare kernel.
“Our stack and our vision, strategically, really haven’t changed dramatically as a result of the acquisitions. Yes, we’ve
embellished a little bit, but the vision remains the same,” Nugent says. For Novell customers, that’s both good and bad. Although
there has never been much debate about the technical merits of Novell’s products, those applications alone won’t be enough
to win customers over to a Linux-based platform.
“You don’t hear complaining about NetWare 6; you don’t hear complaining about ZENworks,” says Laura DiDio, an analyst at The
Yankee Group and a longtime Novell-watcher. “Certainly eDirectory, from a technical perspective, is still more advanced than
Active Directory. The issue, though, is that as Novell’s fortunes have waned, the developer community has pretty much abandoned
them.”
Developers are essential
Gary Hein, vice president of application platform strategies at Burton Group and a former Novell executive, agrees. “Novell
was famous for stability and performance and infamous for developers and applications. Especially NetWare today; you can barely
get a virus checker and a backup package for the NetWare server.”
The stagnation of the NetWare platform has prompted many longtime Novell customers to jump ship to the competition and may
be the strongest argument for the company’s new direction. With the shift in focus to Linux, Novell gains a huge developer
base and not just from the open source community. Commercial vendors that support their products on Linux become selling points
as well. “You can now go back and run Oracle on a Novell platform, which you haven’t been able to do for eight, nine, 10 years,”
Hein says.
Ironically, this infusion of developers could actually have a chilling effect in the short term. The perception that Novell
is abandoning the NetWare OS in favor of Linux could accelerate the erosion of its customer base, particularly among companies
not ready to gamble on open source (see The End of the Line For Netware?).
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