Can Novell survive?
In the journalism game, certain topics are referred to as “evergreen,” meaning you can write about them time and again. In our little corner of the business, an evergreen topic for almost a decade has been: “Can Novell survive?”
Novell once owned the network operating system (NOS) market, but now claims less than a 20 percent share. What happened? Microsoft revved up its marketing machine and Linux came out of nowhere–all while Novell sat on its laurels.
Now Novell is bringing back Chris Stone as vice chairman to help turn the company around. It’s a return to the nest for Stone, who left Novell after a stint with the company in October 1999 to found Tilion, a supply chain event management service provider. He returns to a Novell very different from the company he left two and a half years ago.
Since then, Novell has realized it can no longer compete based on its software alone. Its marquee product–file and print services–is widely available from other vendors, and even directory services have become ubiquitous. Almost exactly a year ago, the company announced it would acquire Cambridge Technology Partners in the hopes of being able to provide customers with lucrative consulting services. So far, the stock market hasn’t given the merged firm much to crow about; its stock price is down about 30 percent from where it was when the merger was announced.
Of course, financial analysts are in no position to tell you whether Netware might make sense for your company. I think it still can. No one beats Novell’s file and print services. The latest version of the software, Netware 6, runs mostly over native TCP/IP, so you don’t need to roll out client software to every node on your network. The software also includes nifty, browser-based server management features. If you find you’re spending too much time managing networking basics or untangling directory service issues, you owe it to yourself to evaluate Netware 6.
His new boss, Novell chairman and CEO Jack Messman, calls Stone “a visionary.” That’s not what Novell needs now. It needs a down-and-dirty fighter who can find a compelling reason for organizations to add Novell’s products and services to their networks. Novell needs to stake a claim in one of the rapidly evolving market spaces it already plays in–such as XML, security, or Web services–and let potential customers know how it will improve their bottom lines.
Novell’s existing customer base should hope that Stone can keep others with an existing investment in Netware from defecting, and grow the business in other areas. If Novell can show signs of growth along with the evidence of innovation Netware 6 represents, it might make defectors who turned to a Windows server NOS consider returning to the fold.
Is it time to count Novell out? Not yet. I haven’t heard anyone suggest the company is in real fiscal difficulties; though the stock price is down, the company ought to be able to survive for years to come, which means you’ll still get support for any product you buy now. If Stone and his new colleagues can succeed in re-establishing Novell in the minds of corporate buyers, the company could actually surprise a lot of doubters.
Articles | Administrator | 
Friday, March 15, 2002 12:00 pm
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