Linux Growth Doesn't Offset NetWare Decline

steveit_is writes to tell us CommentWire is reporting that the decline in NetWare and Open Enterprise sales is plummeting at a much faster rate than their SUSE Linux sales are growing. It seems that the transition is proving to be every bit as difficult as Novell execs originally suspected. From the article: "When Novell last week announced its financial results for the fiscal first quarter ended January 31, the said that growth in its SUSE Linux and related products was decent, but that sales of its NetWare and Open Enterprise Server--a variant of NetWare that uses Linux as the operating system kernel that was announced last year--declined by 11%."

Comments

Netcraft

[Anonymous Coward]

Netcraft confirms Novell is dying. It's been slowly dying for years, and I don't think there's anything to save it. Dunno what will happen of suse afterwards.

Why make the comparison

[Penguinoflight]

Someone has to state the obvious. Past users of Novell aren't going to just switch directly to another Novell product that is completely unlike the other one. Whatever growth of SuSE will be because of the sucess of SuSE to provide a good linux distribution, and not because of Novell's name. We saw this before with Corel; They made a unique linux distribution, and some liked it. Nobody decided to move their department to Corel Linux just because they had been using WP.

What were you expecting?

[penguin-collective]

That story is phrased so that it might suggest like Linux isn't being a big success for Novell, but that's bullshit. Novell had a cash cow with a proprietary enterprise product. That's history. It's history because the market has changed. There is no reason at all to expect that they will ever do as well with any other product.

The fact that they have been able to turn Linux into a business for them at all is a good thing.

Why choose SuSE?

[drgonzo59]

It is not that they have to compete with major OS systems, but there are also a bunch of competing Linux distributions, some of which are completely free and will even offer many goodies for the enterprise customers (the new Ubuntu Dapper for ex.). It is really hard for a linux distribution to stand out. They better have stellar customer support and hope to land some huge contracts with that. They can and will milk the name "Novel" that many recognize from the early 90's but that will only take them so far...

I have tried SuSE, it was nice, polished interface but it just didn't stand out. Now I am addicted to Ubuntu, it is simple, it does what I want and nothing more, kind of like crack cocaine...

Re:Why choose SuSE?

[Bill Hayden]

... there are also a bunch of competing Linux distributions, some of which are completely free and will even offer many goodies for the enterprise customers (the new Ubuntu Dapper for ex.).

Sorry, but it is wishful thinking to say that even the most forward-thinking enterprise customers will have Ubuntu on their radar. You can't get the time of day in the enterprise without a well-known name and the ability to offer a support contract. Sorry to say, but Redhat and maybe SUSE are the only ones with a foot in the door.

Troll? WTF?

[Anonymous Coward]

Some mods are on crack... If anything this is insighful!

Novell was extremely popular at some point (the netware v3 days, mid 90s), then hordes of people started migrating to NT4 to never come back. v4 installs never were as common, and I've only seen a handful of v5 installs. The Netware days are over, big time. Just like OS/2 (which wasn't a bad OS at all at the time). Every freakin' thing Novell bought or touched since then somehow ended up being a failure in a way or another (if you think Sun missed the boat a few times, these ppl are no better). Their only chance of staying in business is suse, and lately I'm seeing interest in that distro drop a lot (especially with v10). Unless they can manage to suck enough of RH's support business to fund themselves (not necessarily a good thing), I don't think they'll live much longer. Not a bad distro, but not good enough to be worth paying for it when you consider the alternatives, and unless loads of enterprises move to linux and pay mega $ for support, they're done. So essentially, they HAVE been dying slowly.

Whoever modded that troll, lay off the crack, really.

Ximian leadership a huge liability

[Anonymous Coward]

The leadership of Ximian that seems to have taken over the Linux direction is an incredible liability for Novell and SuSE. Ximian was a company and a group that could never deliver a polished product that people would actually use. They really saw Novell as a platform for their own egos, and not really a platform actually to serve people, customers, and community.

SuSE was an amazing product and one of the best examples of a fully integrated GUI experience for Linux, where you didn't have to use the command line to use the system. It had polish, and clarity in what it was trying to be.

Compare that to all this Novell Desktop, SuSE branding confusion, coupled with triple alpha software like Beagle, and horrendous monstrosities like .MONO, and you can see why people are not eager to jump on the Novell Linux bandwagon. What is their main leadership qualification?

If Novell would open their tech...

[CarpetShark]

If Novell would open up technologies like ZENWorks, they might get some real interest. An enterprise-wide administration solution (along the lines of active directory) is available in purely Free Software, and it's eventually going to be simplified and packaged for everyone. But Novell have a head start in this stuff: they could make a significant contribution to Linux, and make their own distros famous for enterprise use, if they want to. It NEEDS to be open though, or it's useless to those of us who want to build add-on admin tools and who want to install it across a heterogeneous network.

Instead, they horde their tech, and don't even bother to advertise it much. I'm not really surprised they're failing with that strategy; it has Commodore written all over it.

Apples and Oranges....

[soren42]

Novell is no doubt more than aware that comparing NetWare to Linux is an unfair comparison, just as comparing earnings from this point last year is. Let's take a quick rundown of some differences:

NetWare vs. Linux:

• NetWare is typically licensed per-user, Linux per-server - this is a HUGE difference! For a large enterprise for, let's say 100,000 NetWare users, Novell was licensing annually on a per-user basis. This could come out to millions of dollars if they even charged $10-$20/user (approximately the list price based on 50-100 user bundles). SUSE Linux, on the other hand, is no doubt licensed per-server. That same enterprise can probably support those same users with far fewer servers - let's use an estimate of 2000. Even at the list price of $899 for up to 16 CPUs, that is still a huge shortfall. So, it a significantly different pricing model.
• NetWare was entirely developed in-house - alright, so it was based on DOS, but for all intensive purposes, Novell had a captive developer community, entirely controlled product direction, cost, support, and other factors. With Linux, Novell has managed to trade some of the cost of development for total control of the product - but they still must support and maintain all those users still running NetWare 3(good heavens!), 4, 5, and 6. So, they need almost twice the support staff, and we already discussed the falling revenue. Plus, they still support and patch some versions of NetWare 6, so they are some developers still committed to NetWare.
• The dynamics of their community has changed - in the 90's, the certification to have was the CNE. It meant something. Novell had a huge community of resellers, developers, support engineers, and other partners - essentially under their thumb. Now, they have to compete as just another Linux vendor. Why be just a Novell partner when I can partner with Red Hat, IBM, HP, and everyone else? Why get a Novell CLP9 or CLE9 certification, when I can get the more recognized LPI certification - or (worse, from their perspective) an RHCE certification?
• Their customers' path away has not been Linux - it's been Windows - Novell has been steadily losing file and print customers for years to Microsoft. No offense, people, but face it: most former NetWare admins moved on to WinNT and Win2K years ago. Very few moved on to UNIX or Linux - there are certainly some, but most people that identified themselves as CNE's moved on to be MSCE's, not RHCE's. The problem is, customers are still moving en masse to Windows, and the Linux strategy from Novell has not prevented that.

Okay - I've beat up the Linux/NetWare differences enough, but what about the business differences, and their impact on earnings?

• One year ago, the Microsoft settlement boosted earnings - if you don't get this one, RTFA. The MS settlement was a nice temporary earnings boost, but Novell knew that. Why the market glossed over it still amazes me, but then, it's the sort of thing tech investors tend to do.
• Novell has matured in the past year - I know there's been a lot of negative press about the leadership changes and departures at Novell - especially here at Slashdot, but let me tell you - this is what a company undergoing a major merger integration needs. Especially one changing it's fundamental vision and product focus. Some of the losses were unfortunate - Chris Stone, for example. Some just underscored the growing pains of a company merging several cultures at once - open source and proprietary, US and Germany, GNOME and KDE - too many for all the chiefs to stay and agree. However, IMHO, the current leadership and vision at Novell is remarkable. Novell has done a superb job of selecting the best and brightest from their talent pool to lead the company, and their corporate vision and strategy demonstrate that.
• Novell has strived to maintain product continuity - even at the expense of earnings. Doesn'

Huh?

[dtietze]

Say what? The decline is plummeting? If the decline is plummeting - does that mean that sales are increasing? Is this a posh double negative?

Dan.
Remember - Two wrongs don't make a right, but three lefts do.

They lack vison

[alonso]

I think that they lack in house vision, and they have lost the Suse visionary.
I was a big fun of suse, and I now use opensuse, but the messages that novell sends are confusing. Whitch is the main desktop platform kde, gnome or both?
They have switched the engine of yast (dependencies resolver) to the engine of
redcarpet in beta 5 of opensuse 10.1. I think that there are other examples....
And they have problem in working with community see Xgl vs Xegl or AppArmor vs SeLinux, I haven't the technical skill to decide which solution is the best but these project have no community involvement, in contrary RedHat do everything with community in mind.... and Red Hat is very successful.

P.S.
I know my english is not percet :)

Not quite.

[khasim]

I hear that Novell was pushing really hard for IPX/SPX to be the protocol for the internet, which was silly and impossible because it's a broadcast protocol.

No. They were pushing for IPX to IP gateways/proxy servers so that a local network could run IPX (far less configuration than TCP/IP back then) and still access Internet services, securely. Don't forget that back then people were still selling 3rd party TCP/IP stacks.

Then they put off implementing TCP/IP for a million years, while the internet (and networks connected to it) were taking off on TCP/IP.

On the client, it wasn't very difficult to run IPX and TCP/IP. What they did not do was offer their NetWare file system access via TCP/IP until the 5.x series.

I also hear that Novell put a lot of work into Directory Access Protocol (DAP) for network management databases.

In a way. They focused on using the X.500 standard for their NDS product.

DAP grew and grew and was too bulky to be popularly used.

No. X.500 was designed to handle just about everything in the world. Novell implemented a sub-set of it.

The problem was that Novell did that back when most people were still on NetWare 3.12 or using a Windows domain model.

Admin'ing an NDS tree is more work and takes more expertise. Novell failed to sell people on the benefits of a directory service.

Somebody made up Lightweight Directory Access Protocol (LDAP), which is now used by Microsoft for Active Directory.

LDAP is also a sub-set of the X.500 standard.

Active Directory can talk to LDAP, but it is not LDAP.

NDS can talk to LDAP, but it is not LDAP. Novell even has NLDAP (Novell LDAP) implemented as a server process.

The problems Novell had were:

#1. They made very solid products. There wasn't any reason for small shops to dump NetWare 3.12 and upgrade to 4.x or 5.x or 6.x now.

#2. They VIGOROUSLY defended their licensing revenue. A NetWare server would broadcast it's serial number and if it saw another server using it, it would kick all the users off of it. Meanwhile, anyone could install 1,000 NT servers with a single license number.

#3. Their servers sucked as application servers. But they rocked as file and print servers. But more and more apps were moving to the server.

#4. Novell tried to buy their way into a fight with Microsoft on the desktop with WordPerfect and such.

#5. Today, they are still back in the early 1990's.
5a. Patching GroupWise is more difficult than patching Win2K or
  Debian.
5b. Patching NetWare 6.5 is more difficult ... come on! Debian's solved that problem years ago! Learn from them.
5c. Novell's sales force sucks ass at the small company level. They simply refuse to tell you how to buy their products and even what their products are.
5d. NWAdmin is needed for some admin tasks. Console1 is needed for others. NoRM is needed for yet others.
5e. In order to run some of the BASIC admin utilities, you have to correctly configure NetWare + Apache + Tomcat + Java + LDAP/NLDAP + their stupid Tomcat app + SSL (and I may have left out a sub-system or two). What fucking moron thought that THAT would be a good idea? And the fucking app doesn't even uninstall cleanly so if you do make a mistake, you have to look up how to remove all the little bits so you can re-install it.
5f. Great. You like webservers and such. But why the fuck does EVERY app have to be run via the web with its own fucking ports?

I can go on and on and on about this. Really. Novell has, today, managed to incorporate EVERY bad idea for the last 20 years from every vendor out there.

Seriously. Grab the latest service pack for NetWare 6.5 and make sure you read the install text. You'll have to dig down to a sub-directory to make sure you install 2 sub-items that are NOT automatically installed when you install the service pack but which are required.

Learn from Debian, Novell. Patching your system should be even EASIER than Windows Update.

Re:Not quite.

[Hasai]

Much as I hate to, I have to agree with just-about everything the parent states, particularly regarding Novell's Marketing department. Nowhere have I seen such incompetence last so long (except perhaps in the White House).

Patching a Novell server is not trivial, topped only by GroupWise patching, which I look upon with dread. And God help you if you left out a package on install and now want to add it to a patched server.

Novell used to have an excellent administration model, where you went to a single program (NWAdmin) to do just about everything that needed to be done. Then Novell jumped onto the Java bandwagon and out stumbled ConsoleOne; the slowest, most bloated nightmare I've ever seen. Then even before all functionality could be ported to C1, here came the web interfaces; the most fragile, most confusing mess on the planet. AND THERE'S STILL STUFF STUCK ON NWADMIN!!! They've gone schizo at Novell, I swear it.

Now there's OES, a cross between NW6 and SLES9. If you've both Netware and Linux expertise in-house, it's a quite attractive server package, but if you've only Linux people, or you're pure Netware, or (most likely) neither, you're lost at sea. To top it off, I have been waiting since the release of OES to see a training package for it. I'm still waiting. I suspect I'll still be waiting for quite some time. Hey, Novell: do you really think I'm going to put a system into production that I have NO TRAINING FOR???

There are only two reasons that I haven't jumped-ship yet: the first is NDS (what those Marketing losers call 'eDirectory'), which makes AD look positively pathetic in comparison; the second is server stability. If those two points go the way of everything else, I'm outta here.

'Nuff said.

Re:IBM and Novell

[Erwos]

"IBM is buying a lot from Novell, and not from redhat."

You're joking, right? This statement alone disqualifies whatever else you have to say, because it's obvious YOU HAVE NO CLUE. Red Hat and IBM have a close partnership. IBM constantly plays it up whenever they come with the sales pitches. You can get RHEL on practically anything IBM sells. You're going to have to quantify your statement with hard facts before anyone believes it. You can do that, right?

Note that I'm not arguing IBM doesn't have a close relationship with SuSE (Novell, now), too.

"So I really think that Novell will survive and will have a huge market, more market than RedHat, they are not so cocky about them self as RedHat, Novell wants money, not fame..."

That's a laughable assertion. You don't think there are huge egos at Novell? The reason you keep hearing about Red Hat on Slashdot is that they're continually giving to the community. Aiglx, GFS, scheduler enhancements, gcc development, etc. - if Red Hat gets fame and ego boosts like that, they're A-OK in my book. The folks at Novell are starting to realize this - which is why you're seeing them open-source more and more stuff, and backpedal somewhat on their "hybrid open-source proprietary" philosophy they were pitching shortly after the merger (it didn't win them many friends).[1]

You obviously have some rather pre-conceived notions about Red Hat and Novell. Sorry if the facts get in the way.

I think SuSE is a fine distro, but Novell is flailing about to a large extent with regards to how to evolve itself. They'll probably survive, but it's going to be painful.

-Erwos

[1] I received several sales pitches from them.