Divide to Boom?

DQI Bureau
New Update

Raymond Noorda must certainly be turning in his grave. It has

been barely a month since he left for the pearly abode and already his legacy

has been undone. For over a decade, Noorda fought a relentless battle against

the company at Redmond. Noorda was a former CEO of Novell and to him William

Henry Gates III was an unscrupulous usurper who needed to be stopped at all

costs. Novell and Microsoft were bitter enemies, nothing less...could be more.


Thus, Microsoft came out with LAN-Man to beat Novell's Netware

and Novell went on a buying spree, for instance WordPerfect, to take on the

might of Microsoft on the desktop space. Sadly, Novell wasn't David, and burnt

itself hollow in its battle with the Goliath. In 1993, Noorda parted ways with

Novell and set up the Canopy Group that invested in a whole lot of companies

working in the open source space. Novell dragged on.

A decade or so later, Novell did a course correction and in

2003, jumped on the open source bandwagon with the acquisition of SUSE (a few

months before acquiring SUSE, Novell had acquired an open source application

developer company, Ximian). In spite of the shift, Novell could never regain its

past glory. It was a distant second to another open source major, Red Hat. That

was the state a few days back till Novell decided to sellout.


Embrace, Extend, Exterminate

Since the eighties, Microsoft has been at loggerheads with some or all the
IT companies. It is renowned for the subversive tactics that it employs to

nullify opposition. "Embrace, Extend, Exterminate" is supposedly the

corporate philosophy that it lives by. In its three decades of existence,

innumerable companies have either been gobbled up or simply ceased to exist.

Gates (and now Steve Ballmer, CEO) do not look kindly at competition.

Sun, Oracle, Apple, IBM...all have been detractors of Microsoft.

Google was one of the few companies that was able to steal a march over

Microsoft and establish itself as a leader in the online space. Yet, one of

Microsoft's favorite bugbear has been a product company with a cute penguin as

its trademark: Linux. The open source movement is an anathema to Microsoft.

'Halloween documents' is the name given to internal

Microsoft memos that were leaked to the open source community in 1998. It is a

revealing commentary on how Microsoft perceives competition, mainly Linux

kernel-based operating systems. The memos dub open source software as 'a

growing long-term threat to Microsoft's dominance of the software industry.'

The documents supposedly go on to acknowledge that certain parts of Linux are

superior to the versions of Windows available at the time, and outlined a

strategy of "de-commoditize protocols & applications"; or

basing networks and documents around proprietary standards, thus they can only

interoperate with machines that work on Microsoft OS. That was at the turn of

the millennium.


Competition to Coopetition

Noorda in his heydays had popularized the term coopetition, ie, cooperative
competition. This philosophy is the supposed basis on which the Microsoft-Novell

pact is built. The pact has been touted as a symbiotic breakthrough. Yet, on

closer analysis, there seems to be fairly little that Microsoft seems to be

getting out of the deal. But then, remember your kindergarten teacher's

advice? Appearances can be deceptive.

Novell is in a rag-tag shape; SUSE-Linux was certainly not a

match-winner. The deal with Microsoft seems to be God-sent for Novell. First is

the cash inflow, Microsoft would be paying Novell a sum total of $380 mn, that

includes payment for SUSE Linux Enterprise Server subscription certificates, as

money for patent cooperation. Microsoft has also dangled the olive branch, it

will not sue Novell's customers for patent infringement. It will also market

Novell's Linux version to its existing customers.


The new friends would also collaborate in the development of

modern technologies in the space of virtualization, management and document

format compatibility (remember the Halloween documents). So now, Linux,

importantly SUSE-Linux and Windows will be interoperable. A great victory of

sorts for the open source movement, or is it?

"Once the details of

the agreement are clear, I anticipate Red Hat will react in some way or

the other. There could be more surprises in store, in the days to


-Bhavish Sood, principal analyst, Gartner


Devil's in the Details

The open source movement was turning out to be quite a formidable challenge
for Microsoft (the likes of Google, Amazon, and other Wall Street firms were

using open source systems), there's still some spadework to be done.

As of now, there are two main players servicing the open source

market, namely Red Hat and SUSE-Linux (Novell). While Red Hat has close to 80%

share of the market, Novell makes up for the rest. There are a few other smaller

distributors like Ubuntu, Xandros, Linspire, and others. Strangely, just a few

days before the Microsoft-Novell announcement, Oracle had decided to market its

own version of open source system quite similar to Red Hat's.

Thus, Red Hat could give Microsoft a formidable challenge in the

days to come. Now in one move, the open source market is divided in two camps-one

blessed by Microsoft, and on the other end are the baiters. While it is quite

fashionable for open source developers to chant 'Win-Down' slogans,

corporates and organizations would prefer a more peaceful and cooperative model.

The preference for interoperable systems could boost Novell's sagging fortune

and eat into Red Hat's share (embrace and extend).


The irony was not lost when Ballmer made the statement at a

press conference: "We're here to announce a set of agreements that will

really help bridge the divide between Linux and Windows." Did Linux really

need a bridge that was built in Redmond? Meanwhile Ron Hovsepian, CEO, Novell,

talked about how he initiated the talks with Microsoft and how in the end,

"this announcement gives our customers interoperability and peace of mind

all in one."

India Speak

According to analysts and market sources, Indian players are quite excited
at the prospects of the future. There is significant support for open source

systems in India, and now companies could go in for heterogeneous systems,

combining both Windows and Linux. "A majority of servers in India are

already on the Windows platform, this would give certain users the liberty to go

in for multiple environments, using SUSE-Linux," says Doug Hauger, chief

operating officer, Microsoft (India).


Hauger also pooh-poohs the 'embrace, extend, exterminate'

talk. "All this talk does not really make logical sense. No one owns or

controls GPL (General Public License), so where is the talk of exterminating it.

It all seems quite humorous," says Hauger. He agrees, that Microsoft could

look at a broader initiative in the future, involving more players like Red Hat.

"This pact has really broken new ground. What I find most

exciting is how mindsets will change in the days to come. The religious fervor

sort of days (oh! I do not like Microsoft) are over, and have been replaced with

technical and technological talk. This is the evolution towards a mature

marketplace, a place where technology will take precedence over everything

else," he adds. Meanwhile, the Novell India team seems to be in a

celebratory mood already. According to sources, the top management is currently

in Paris for 'official work'.

Sleeping with the Enemy

Late Noorda had supposedly thwarted two acquisition attempts by Microsoft,
after a failed merger attempt. If Gary Rivlin's "The Plot to Get Bill

Gates," is to be believed, Noorda liked to refer to Gates as

"Pearly" and Ballmer as "The Embalmer." According to Noorda,

Pearly promised the heaven, while the Emballmer dug your grave.

Hopefully it is a different Microsoft and a different strategy.

Probably, history would not really repeat itself. Just one final piece of advice

for Hovsepian, when you dine with the devil, make sure you do not end up on the

menu. May Noorda's soul rest in peace. Amen!

Shashwat Chaturvedi