GroundWork Open Source, Inc. (GWOS http://www.gwos.com), the leader in commercial open source systems and network management software, today announced it will conclude the GWOS barCAMP Deux sessions with an exclusive release of a SUSE powered Virtual Appliance package that integrates GroundWork Monitor Enterprise 6.1 with Zendesk (www.zendesk.com).
At the high end, IBM deploys SLES for some large companies with mission-critical systems.
Implementing an IBM System z10 Enterprise Linux Server helps EFiS EDI Finance Service AG save money and the environment
Here is some guidance for anyone who wants SLED 11 installed on this HP hardware:
However, we still tested the stock version and came away impressed. For the vast majority of computing tasks – using Evolution to check your POP mail, burning a DVD disc using LightScribe (included with this SLED build) and even playing games or watching movies – the Elite 7000 is up to the task. Where we noticed a performance degradation is when we compared Linux-to-Linux between this system and a home-built PC that uses an SSD drive, an Nvidia Quadro CX graphics card and has 6GB of RAM. There was no comparison, of course – the home-built system was snappier even for popping up Firefox, copying files and running simulations with a program like Autodesk Revit Architecture (which normally prefers a workstation PC).
That’s about it when it comes to SLE*.
Xandros/Linspire
Another distribution that we name “Ballnux” would have to be Xandros because Linspire and Turbolinux are more or less history. Here is a little new rant about Xandros:
Linpus and Xandros aren’t looking quite so exciting. Of course, that could change as smartbooks with ARM-based processors start to hit the market, since they’re not capable of running Windows.
Not looking like Windows does not make something deficient. People don’t need Windows, they just need something that works. But anyway, Lindows, which was bought by Xandros in its “Linspire” form, is now being called one of the “worst products ever”.
9. Lindows
The hype was palpable surrounding Lindows: it was going to be a Linux operating system that provided full compatibility with Windows. Microsoft didn’t take kindly to this and even sued, unsuccessfully, saying that Lindows was infringing its Windows copyright. The court case just added to the excitement.
Xandros never did anything substantial with Linspire, not even with CNR.
Samsung
Microsoft is also extorting Linux phones and Samsung lets Microsoft get its way. Here is a new discussion about Samsung’s Android phones and about Bada:
Many people think of it as a poor thought, but Samsung has made it clear that Samsung Bada is being launched to make smartphones accessible to everyone. The smartphone market is still in its growing phase and Bada platform aims at improving the current situation.
Bada is mostly a layer and the platform that’s underneath benefits Microsoft if people buy their phones from Samsung. █
Summary: Disagreement between the press and the hostile acquirer as to whether or not Novell would stay in tact
NOVELL is at a stage of uncertainty and state of denial because it’s likely to be acquired soon [1, 2, 3, 4, 5, 6, 7]. The Novell-faithful people watch with concern as their Novell skills/certifications are at stake and Novell’s BrainShare, which is just days away, has "uncertainty" written all over it. Attendants are likely to bring up questions about the company’s short-term plans. Novell’s PR team promotes the event [1, 2], whereas analysts at Ovum claim that “The end is nigh for Novell”:
After years of acquisition rumors, last week Novell received a buy-out offer from hedge fund Elliott Associates (EA). Whether the offer succeeds or not, Novell is likely to end up in pieces.
[...]
Novell’s parts are more valuable than its sum
Novell’s board is likely to reject the current offer before Novell’s annual conference, BrainShare, starts on 21 March. It can keep rejecting EA’s offers, but it cannot stop EA from going directly to Novell’s shareholders. Should EA be successful, it is likely to pocket Novell’s cash then split the company and sell its constituent parts.
This news report from Bloomberg (also published in BusinessWeek and later corrected slightly) claims that Novell will be torn apart by Singer and his minions, who are only interested in money and not in Novell’s staff, products, and customers.
Elliott Associates LP, the fund manager that made an unsolicited $2 billion offer for Novell Inc., may consider selling the NetWare networking-software unit if its bid succeeds, a person familiar with the matter said.
Elliott, which owns about 8.5 percent of Novell stock, would also try to run the company more efficiently and bring about $400 million in cash that Novell holds off shore to the U.S., said the person, who asked not to be identified because Novell hasn’t agreed to the bid. Elliott may also try to find a buyer for Novell’s business that specializes in an open-source operating system, the person said.
“Our intent is to own Novell,” New York-based Elliott said in an e-mailed statement. “We have absolutely no plans to sell any business units.”
As the week was ending, rumors were swirling that the hedge fund suitor of Novell, Elliott Associates, which last week offered $1bn net of cash to take over the perennially struggling software maker, was going to start selling off its target’s assets if it clinches a deal.
[...]
In response to the Bloomberg story, Elliott put out a statement two hours after the market closed denying the rumors. “The story that Bloomberg ran today was inaccurate. Elliott has made no statement with respect to its intent regarding Novell. Elliott wants to own the company. Elliott has no plans to sell any business units and to report anything else would be erroneous.”
I personally do not want to see SUSE to die. I ‘dabbled my feet’ with linux was SuSe 6.0. I actually bought the boxed version of that software (since installing, downloading, configuring, etc were a major pain in those days). Among all linux I tried that time (which was probably early 1990s), SUSE was always the winner in detecting any hardwares I throw into. All other distros just simply failed, usually, in detecting the ’soft modem.’ Remember that era? If not, soft modem is that annoying modem that can be used with Windows driver only. You would be lucky to run your beloved 1.44k band modem if someone did the hack for linux driver of it.
Taking a moment to look a few days back (before the Bloomberg report and the subsequent denial), Paul Rubens believes that sale of Novell’s assets is inevitable.
The enterprise Linux space has suddenly got very interesting following the news that a bunch of sharp-suited New Yorkers have made an offer to buy SUSE Linux’s parent company, Novell. Whether or not they succeed, there can be little doubt that it’s cheerio and night-night for Novell, a business that has been doomed since, let’s be brutally honest here, everyone stopped buying NetWare.
The offer, from hedge fund outfit Elliott Associates, was for $5.75 per share, valuing Novell at a shade under $2 billion. But bearing in mind that the company has vast cash piles in various currencies, worth about $950 million, and the offer values Novell’s businesses at around $1 billion greenbacks.
But there are fears that if Novell goes, that could be the first domino which damages the commercial outfits based on Linux.
The next target might be Red Hat. Some think that if Novell’s SUSE Linux business finds its way into Oracle’s or VMware’s or IBM’s paws, it will be hard for Red Hat to remain viable as a stand alone company.
This is only based on CNET, which they think is a reliable news site. When they say “there are fears” they only refer to Matt Asay, who used to work for Novell and thus compete strongly against Red Hat. This whole thing also feeds the shameless Microsoft booster Preston Gralla [1, 2]. His disinformation is self explanatory and public admiration of Microsoft very much expected. █
Summary: News about Novell’s GNU/Linux business, based on the past week alone
THE PAST week has been interesting because of the offer to buy Novell [1, 2, 3, 4, 5, 6]. For SUSE it has been a very quiet week, but someone marks this milestone of 10 years at Novell.
Working as a manager sometimes has not so nice days, but tomorrow it will be a really great day. Novell HR has asked me to celebrate a team members ten years anniversary with Novell. That means fun and a present since ten years is a long time, yes, quite a long time for IT industry.
It is possible that SUSE will be passed on to another company after more than 6 years at Novell. Ted, who used to symbolise this project in a way, has been blogging about iPhone and Apple stuff recently; the old days of SUSE (before the Microsoft deal) are sorely missed.
During the last openSUSE Conference we (Benji, Brent, Bryen, Francis, Michal, Petr, Stephen and me) had a brainstorming meeting about social aspects of our community. We were able to come up with lots of ideas and I want to thank all of you for your participation!
[...]
I created a Tog application, ported all anonymously visible pages to our Bento theme and finally deployed it on connect.opensuse.org address, so you can look at it. In the end we would like to replace the old users.opensuse.org application with Connect and make it a new central place for users.
One other member writes about OpenSUSE in Google Summer of Code 2010.
The wonderful Vincent has already sent the initial call for participation, so who’s up for it then?
OK I’ll take it that there are several hands raised in the audience (I reckon I’m being overly cautious, I’m sure there are loads of hands up but as I don’t have my glasses on I can only see the first two rows). So what do we need from our lovely community to help make GSoC 2010 a success?
If anyone has been following my tweets/dents, you will have noticed that I sporadically mention something about “Operation Factory” followed by a pile of tags. Well for the curious, Operation Factory is basically getting the latest and greatest Moblin into openSUSE.
Another new video about eX5 System X Servers is all about Novell.
HP will preinstall SLED on some more computers (as an option), but it’s a shame that there is no option of a distro that’s not Ballnux.
HP also announced four models in its middle of the road Probook series, which it says comes in “sophisticated” colours. Colour choice aside, the most interesting feature of these is that they can be pre-installed with SuSE Enterprise Linux.
All the models HP launched today feature Daystarter, a preboot screen that allows you to view things like your calendar and battery life while booting into Windows. However with SSDs and the option of Linux it isn’t the time taken to get past the splash screen that HP should look to reduce but rather the time taken to load all the pre-installed junk once you’ve made it into Windows.
The EliteBooks come with Microsoft’s Windows 7 Professional, Windows XP (tablet edition where appropriate), Windows Vista Business, or FreeDOS pre-installed. Windows 7 Home Premium and Vista Enterprise are supported, and Novell’s SUSE Linux Enterprise Desktop 10 is certified to run on the machines, but it’s not pre-installed. HP is also tossing on a trial version of its SkyRoom high-def video conferencing software onto the new EliteBooks.
“We have been offering multi-vendor support solutions to our customers,” says Dionne Morgan, worldwide solutions marketing manager for HP’s Technology Services group. “In addition to IBM and Dell servers, we also now support Sun servers and Sun Solaris 10 for HP ProLiant servers. And for HP Integrity servers we’re now supporting Novell, SUSE Linux and Microsoft Windows Server 2008.”
Red Hat is, oddly enough, missing. It’s Ballnux only (taxed by Microsoft) and Microsoft still wants Novell’s customers or at least their inexplicable “Linux tax”:
He reckoned customers will be wooed away from IBM and Novell towards Microsoft, once its on-line offerings are up are running.
Initially made available to only a select group of its customers early last month, SEP’s backup appliance, powered by SUSE Linux Enterprise from Novell, is now officially available. Carlos Montero-Luque, vice president of Business and Product Management at Novell said that “The SUSE Appliance Program enables SEP and other ISVs (Independent Software Vendors) to quickly configure and customise software and virtual appliances”.
In this episode: Version 2.6.33 of the Linux kernel is here and it includes a new 3D accelerated Nvidia graphics driver. Canonical’s online music store will only provide MP3 files, and Apple sues Android partner, HTC. We report back on our experiences with SUSE Studio and answer our critics in the Closed Ballot.
The stock market reaction to the offer was predictable: Novell’s stock surged 27 percent right after the news broke, and it should stay strong for a while until the market figures out if this is a Good Thing.
The Linux community hasn’t raised a big fuss, though I suspect they’re still absorbing the news. I know I am, for my part. In particular, I am wondering what will happen to Novell if they accept this unsolicited bid?
Some people in the know, like Canonical’s COO Matt Asay think this deal could work for SUSE. In his view, Elliot would do well to sell off Novell’s Linux division.
I wish I could agree with him, but I looked at Elliot Associates’ past history of taking “an activist approach to investing, frequently amassing significant but minority stakes in distressed or under performing companies and attempting to foment change,” and I don’t like what I see.
Elliot Associates is best known as a ‘vulture fund.’ They don’t make investments to turn companies around. They make investments to crush the cash out of them and then leave the picked over bones for someone else to pick up.
Andy Updegrove, a lawyer, calls it a “Game of Cat and Mouse”.
I haven’t seen any article yet, though, that describes in detail how the high stakes game of tender offers is played, and how the usual process maps (and doesn’t) to a high tech company like Novell. So I thought I’d provide an overview for those that haven’t had occasion to follow a tender offer in the past, and also my thoughts on what may happen over the next several months in this particular game of cat and mouse.
So here goes.
The tender offer game: First up, let’s talk about how the standard drama plays out. It starts with the acquiror trying to pick up as much stock as possible on the sly before it comes out of the closet. That’s because once word gets out that the company (referred to as the “target”) is “in play,” the stock will go up. So the acquiror wants to build as big as stake as possible at the cheapest price it can.
But the securities regulators have long realized that this presents two problems: first, the sellers will feel cheated if they later find out they sold at a steep discount to what others get a short while later, and second, the acquiror will vote all the shares it picks up in favor of the acquisition. So the Securities and Exchange Commission (SEC) requires any company that acquires more than 5% of the stock in a public company to make a public filing disclosing that ownership and its intentions.
That filing is made on form 14D, and it must be regularly updated as the acquiror’s ownership percentage changes, and as its intentions change. When an acquiror files a 14D, it could affirmatively state that it has no intentions of making a tender offer. Depending on the acquiror, that statement might be credible, or it might be viewed with suspicion. But if it affirmatively states that it intends to make a tender offer, or is keeping its options open, then the word spreads – fast.
Novell’s stock may be rising (the valuation of Novell’s assets is discussed at IDG), but that’s not the point. As Chips B. Malroy explains, “If Singer acquires Novell for 1.8 billion, the causal bid, and Novell has 991 million is cash, Singer is only paying 809 million actually. Singer has lowballed the bid, in hope another company will come in and bid more, so that drives up the price of the 8.5% that Elliot already has, profit, short term, mission accomplished. But if that doesn’t happen, and Novell will surely reject the bid, wait for some minor setback in the SCO case, or the next quarterly results from Novell, something bad, and then, true to form, Elliot will reoffer at a lower bid. That is Singer’s modus operandi. By doing this, he causes the stock to tank, so he can buy more cheaply.”
“Singer has lowballed the bid, in hope another company will come in and bid more, so that drives up the price of the 8.5% that Elliot already has, profit, short term, mission accomplished.” –Chips B. MalroyWe have already learned that lesson from Carl Icahn. Malroy comments further on “what Singer will do to Novell, should [he] buy it. He will get rid of almost all top management, and most of middle management. Stop all R&R mostly. Stop and or sell any parts of the company not profitable (and transfer the 991 million to Elliot first).”
Summary: A look at all the coverage we could find about Novell’s financial report from Thursday
LOOKING back at the past 2 weeks, we find that Novell’s results did not surprise for the better. Here is a roundup of some posts on the subject, latter parts being more relevant than the former.
The Week Before
A week and a half before the results came out there was nothing particularly interesting in the news. Novell was just mentioned in:
SmarTrend, our proprietary pattern recognition system, called an Uptrend for Novell (NASDAQ:NOVL) on January 06, 2010 at $4.53. Since then, Novell has returned 9.9% as of today’s recent price of $4.98.
It didn’t last long.
Results’ Week
Things became a little more interesting days before the results came out, with coverage including:
Assured Guaranty (AGO), Crocs (CROX), Fluor (FLR), Gap Inc. (GPS), LaSalle Hotel (LHO), Novell (NOVL) and Universal Health (UHS) are among the major companies that will report their quarterly results after the markets close for trading.
After the markets closed for trading in the previous session, software solutions provider Novell Inc. (NOVL) reported a higher profit in its first quarter, helped lower operating expenses, notwithstanding a decline in revenues. Earnings for the quarter were in line with estimates, but revenues fell short of expectations. Looking ahead to the second quarter, Novell expects sequential revenues to be flat.
Novell Inc. (NOVL) saw shares fall slightly after the company said fiscal first-quarter earnings per share were in-line with the Street’s view, but reported worse than expected quarterly revenue.
Novell shares slump after quarterly revenue outlook
[...]
Investors pushed Novell /quotes/comstock/15*!novl/quotes/nls/novl (NOVL 4.69, -0.01, -0.21%) shares down 1.3% to $4.75 after the business software provider said it expects second-quarter net revenue “to be similar” to first fiscal quarter that ended in January. Analysts had expected second-quarter revenue of $212 million. Novell reported first-quarter revenue of $202.4 million compared with $214.9 million in the year-ago period.
Novell, Inc. announced that for second quarter of 2010, it expects net revenue to be similar to first quarter of 2010 revenue levels. The Company reported net revenue of $202 million in first quarter of 2010. According to Reuters Estimates, analysts were expecting the Company to report revenues of $212.6 million for second quarter of 2010.
Earnings for the quarter were in line with estimates, but revenues fell short of expectations. Looking ahead to the second quarter, Novell expects sequential revenues to be flat.
They compare a year of financial collapse to one that is less so. They also say nothing about the small margin, whose increase on an absolute scale is rather small. Here is what a Microsoft boosterhad to say and also another perspective:
Elsewhere, Novell Inc. (NOVL) reported first-quarter net income of $20.2 million, or 6 cents per share, on revenue of $202.4 million. Analysts had expected Novell to post a profit of 7 cents per share on $207.6 million in revenue. Options traders had high hopes for NOVL’s quarterly report, with the stock’s SOIR of 0.17 indicating that calls outnumbered puts by a factor of more than five to one. What’s more, this ratio arrives at an annual low, meaning that these speculative investors have not been more bullishly aligned during the past year.
Here is what Novell boosters had to say, looking at just one portion of the business in isolation:
Novell’s latest quarterly financial results, revealed today, were a mixed bag for the SUSE Linux provider. Novell made progress in some areas. But didn’t really thrive in others. Where does the company go from here. The answers will likely surface at the Novell BrainShare 2010 conference (March 21-25, Utah), where Novell will strive to energize channel partners and customers? In the meantime, here’s a look at Novell’s current business condition … through the eyes of The VAR Guy.
Initially, The VAR Guy wasn’t all that impressed with Novell’s latest financial results, announced Feb. 25. But our resident blogger overlooked one important fact: Novell’s SUSE Linux business is now break-even. That’s an important milestone — but what does it say about the broader open source industry’s march to profitability? Here are some clues.
There is a picture of a scale there, with people on one side and cash on the other. GNU/Linux in general is growing rapidly, but Novell broke even only after SUSE layoffs which cut expenses down. “Microsoft Deal Slumps,” claims Sean Michael Kerner and Timothy Prickett Morgan more or less agrees with him about Novell’s Ballnux business breaking even.
For the quarter, Novell continued its trend of ever-shrinking overall sales as its legacy NetWare operating system and GroupWise collaboration software business declines faster than SUSE Linux support revenues can fill in the gap. Total revenues for the quarter came to $202.4m, down 5.8 per cent, with software license sales plummeting 25 per cent to $21.2m (largely because of NetWare declines).
Days Afterwards
As the following chart hopefully shows, Novell’s stock respondednegatively to Thursday’s report. It fell on Friday. █
Summary: Very little SUSE coverage with substance; a lot of coverage about Bada and LG’s plan to make an e-reader (probably Ballnux based)
SUSE (SLES/SLED)
IT HAS been a very quiet couple of weeks for SUSE. Apart from some PR rambles about SUSE appliances [1, 2, 3, 4] (mostly recycling of old news), it turns out that Novell is paying RedMonk for some public shows about SUSE.
ROC Software Systems Inc. announces the first release of the ROC EasySpooler SUSE-powered appliance. Based on the reliable ROC EasySpooler core technology and a fully supported version of SUSE Linux Enterprise from Novell, the appliance provides the highest level of print output management available to any business environment.
Here is something related that was mentioned two or three weeks ago when the press release came out.
Summary: The following FOSDEM 2009 talk shows that Novell not only ignores the GPL but that it also disregards other licences that it disagrees with
A story that we mentioned one year ago is worth bringing up again in the form of an embedded video. Seek to 18:00 and watch what was being said in last year’s FOSDEM. █
