10.10.08
Quick Mention: Novell’s Value Approaches $1.4B, Stock Falls Nearer to $4
The turbulence in Wall Street is not so bad today, but Novell is already down 4.31% to $4.22. Its market cap sank to 1.46 billion and Microsoft too seems to have reached its lowest value in about 10 years, despite massive buybacks, a rumoured spendings freeze and looming debt. Community distributions of Free software seem unaffected, if not poised to capitalise on the storm. Yesterday, for example, Sabayon’s Joost Ruis wrote: “Our team is growing stronger and everybody is working hard to get things in shape.”
It’s always amusing to look back at what respectable ‘analysts’ have said. █
“In January [2008], Jefferies analyst Katherine Egbert predicted the buyback when she raised her rating on Novell stock from hold to buy and jacked her price target 50 cents to $7.50.”
–NetworkWorld on ‘Über’ analyst Katherine Egbert
“Talk is cheap. Show me the code.”
–Linus Torvalds
Highlight: Novell was the first to acknowledge that Microsoft FUD tactics had substance. Novell then used anti-Linux FUD to market itself. 
Highlight: Xandros let Microsoft make patent claims and brag about (paid-for) OOXML support. 
Highlight: Linspire's CEO not only fell into Microsoft arms, but he also assisted the company's attack on GNU/Linux. 
Highlight: Microsoft craves pseudo (proprietary) standards and gets its way using proxies and influence which it buys. 
Highlight: The invasion into the open source world is intended to leave Linux companies neglected, due to financial incentives from Microsoft. 
Analysis: Xen, an open source hypervisor, possibly fell victim to Microsoft's aggressive (and stealthy) acquisition-by-proxy strategy.
Josh Bell said,
October 10, 2008 at 1:41 pm
Roy,
Yes Novell’s, Microsoft’s and even RH’s numbers are horrible right now as are the global markets in general. But we really don’t know how well some community distros like Ubuntu are doing since they are privately owned and do not have to report the same way publically traded companies do. In regards to the analyst’s comments those were made before the global meltdown that no one predicted. She may have been right if things stayed equal. After all Novell’s 52 week high was over $8.00 per share.
AlexH said,
October 10, 2008 at 2:00 pm
@Josh: just because a company is private doesn’t make a distribution “community”.
In fact, all distributions rely on commerce to some degree or other: whether it’s simply subsidising download service, or subsidising large amounts of development (e.g. Ubuntu), the fact that the stock markets aren’t doing well is no cause for celebration.
Whether or not you like everything Novell do, wishing for their demise seems to be an entirely unproductive position to take with respect to free software. As one of the largest contributors, the free software community would be much worse off even before you count the “controversial” Mono contributions.
Roy Schestowitz said,
October 10, 2008 at 2:06 pm
AlexH,
The scale of the meltdown is not something an individual (or even one country) can control. It’s terrible, but it’s just something to accept, not to fight. I merely try to see where we might end up when the storm is through.
As for Canonical, Mark Shuttleworth had deep pockets, so they’ll do fine.
Josh Bell said,
October 10, 2008 at 2:27 pm
@AlexH: I agree with you. I’m not wishing Novell any ill will.
@Roy: I know Mark has deep pockets but the market affects everyone even those with deep pockets.
Roy Schestowitz said,
October 10, 2008 at 2:36 pm
I worry a lot more about Mandriva.
Roy Schestowitz said,
October 10, 2008 at 3:19 pm
Incidentally: http://beranger.org/index.php?page=diary&2008/10/10/12/36/33-incidentally-mark-is-right-and-n
AlexH said,
October 10, 2008 at 3:35 pm
@Roy: the stock market problems don’t affect public companies directly. It directly affects the investors in public companies, and Shuttleworth is undoubtedly amongst that number.
With the brains he has in his operation, he almost certainly has plenty of money still available. But it will have affected him; those with even the deepest pockets are being affected.
With share prices this low, it actually means a couple of things. Companies like Red Hat, who are otherwise extremely profitable, suddenly become possible targets for private capital.
The companies who underwrite the community distros - like AMD, HP, Intel, etc. - are also suffering. That could easily affect the likes of Debian.
You can’t just look at the share price and say those people are hurting. Most of them are doing stock buy-backs, and the low price really benefits them.
I think you’re right to worry about Mandriva. I also worry about Sun, and (to a much lesser extent) Red Hat. This is going to affect everyone.