Novell lost its way in the early 1990s and it is desperate to get back regain its lead in the OS market. Its Brainshare conference last week showed that it has learned from mistakes and that it has the right ideas and technology to succeed, but offered little to demonstrate how it will translate those ideas into sales.
Like Lotus, Novell was pushed aside by the relentless march of Microsoft and its magnificent marketing machine, despite trying a number of unsuccessful routes to get itself back on the right road. Now, even company executives admit that the expensive acquisition and sale of Unix Systems Labs and Word Perfect were ?half-baked? tactics - the result of a flawed strategy to broaden and challenge Microsoft?s dominance in the whole software market.
At its Brainshare event, Novell said it has recognised it has made mistakes and hopes its massive installed base of Netware and CNE engineers can help it regain the pole position in OSs. It will focus on networking software, the one area that has given it great success. Although its collaboration and email Groupwise product is a useful sideline, the fortunes of Intranetware will determine Novell?s fate.
In some respects, Novell was lucky that the Internet took off when it did and as quickly as it did, because companies needing Internet and Intranet access turned to their OS supplier or Var to add access to their existing Netware networks. Novell was installed in the right place at the right time.
One anonymous reseller at Brainshare agreed. ?If corporates had moved away from Netware quicker, Novell could not talk about such a huge installed base and would have to win back customers, rather than just hold on to them,? he said. ?Novell is installed, so my customers have had to decide to jump and leave them - Novell has to mess things up to lose.?
Like Netware, Unix was the omnipotent OS of choice in its day and still boasts a massive market presence. But the vast majority of vendors and customers are dumping Unix as new technology becomes available and Netware, under its new guise of Intranetware, must evolve rapidly to avoid the same fate.
Novell promises it will evolve and outlined a product strategy with few frills but built around the network, its core competency. Unlike Unix, Intranetware works with competitors if necessary. That is important to Novell and its partners, who are also crucial to the future of Novell?s business. In the last three weeks it has announced deals with Intel, Oracle, Netscape and Sun Microsystems; rapidly-growing companies that are backing the network computer and Java. They are also the main anti-Microsoft players.
Although Novell claims Intranetware will work with Microsoft Windows NT, it is clear from the barbed anti-Microsoft comments made by Novell executives at Brainshare that they are still smarting from Microsoft?s victory and particularly the mauling Word gave Word Perfect before Novell sold it.
But, Brainshare delegates were told, that was the old Novell. Chairman John Young, president and COO Joe Marengi and incoming chairman Eric Schmidt are leading the company in a new direction after painfully repairing the damage of the past. Denice Gibson, senior VP of products, is typical of Novell?s new executive team. Clearly treated as Marengi?s second-in-command at Novell, Gibson is known as a hard-working turnaround specialist and has been promoted in her nine months at Novell to be responsible for all its product groups.
She is brutally frank about Novell?s past. ?When I came to this company it was sluggish and it was hard to make decisions. There was a lot of in-fighting. Now it has energy and personalities.?
Gibson believes Schmidt will bring technology and vision to Novell. ?A few people will be put in their place,? she said. ?Marketing is a huge issue and Eric can help. In 45 to 60 days he will clarify where we are going.?
Schmidt offered few tangible ideas at Brainshare - he only joins the company on April 7. He said: ?It would be unwise to bet against the Web, Internet and Intranet. Novell is betting on Java and ISVs that develop on the Java platform. Novell has so much to offer but nobody knows this. It?s my job to fix that.? Most Brainshare attendees were pleased at his appointment and his technical nous, although many expect him to boost Novell?s marketing team.
Jean Bozman, analyst with research firm International Data Corporation, said Novell ?has the right ideas but needs the right conditions to be successful?. Other analysts are impressed by Novell?s new, sensible message but are reserving judgement on its future until they see what Schmidt does next.
Novell?s board has the ideas, leadership and tools to get back to the front of the pack in its field. But Apple Computer has those attributes with CEO Gil Amelio, cost-cutting and an Internet-based strategy, and they have not yet helped it out of deep financial trouble.
Novell has been forced to concentrate only on its core market, find the right partners and rely on its customer base to boost flagging sales. Now, to get back to the front of the race, it needs Schmidt to steer it in the right direction, its partners to help it compete, more marketing expertise and its resellers to favour Intranetware. Otherwise, it will be beaten by Microsoft again and will drift out of the running completely.
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