Swirling speculation and poor financial results are not enough to shake the Novell faithful, if New Zealand NetWare user group head Craig Harrison is any indication.
Novell has announced an 83% drop in its third-quarter net income to $US8.6 million on revenue of $US270 million. Measured against income of $US49.3 million on revenue of $US327 million for the same quarter last year, the dive makes Novell the third-worst performer on Standard & Poor’s 500 stock index.
The dramatic slump fired off a round of speculation ranging from an IBM takeover to the split of the company into three business units. Neither chief executive Eric Schmidt or Novell New Zealand manager Peter Revell will comment on talk of a buyout and Schmidt dismisses rumours that Novell may spin off business units although he doesn’t rule out such a move in the future.
All this plus a new strategy which shifts Novell’s focus from flagship product NetWare to network services applications such as GroupWise, ZenWorks and eDirectory should be enough to unsettle the most loyal user, but Harrison remains happy with the company, the strategy and the products. And he says talk among members of the local branch of NetWare Users International is neither pessimistic nor worried.
He laughs off talk of an IBM buyout saying such speculation has been around for as long as he can remember, although in his opinion “it would be a very sensible buy”.
As for the spin-off rumours, he doesn’t think a split along the lines of the recently formed business units - net management, net directory and net content - would hurt Novell. Neither would it have the same impact as the much vaunted Microsoft split.
“Internally [Novell] is split up anyway. It has different teams working on different areas.
“Novell’s approach is totally different to that of Microsoft. Novell is about getting different products to work with other platforms. Microsoft is about everything working with Microsoft.”
Novell’s move to become a provider of network services as opposed to network operating systems - the company’s roots - gets Harrison enthused.
“I like what they’re doing,” he says. “It’s becoming irrelevant what NOS you run on and these days you can’t find a network that has just one platform.”
Harrison, who is the network manger of Auckland’s Diocesan School for Girls, recently switched the school’s 600 machine network from exclusively NetWare to a NetWare/Microsoft NT mix. He is also considering adding Linux servers.
He swears by Novell’s administration product ZenWorks to manage the 168 applications on the network and eDirectory (formerly NetWare Directory Services) to control authentication and access for the school’s 1500 users.
He is particularly pleased that eDirectory now runs across all major platforms.
“That means I can have whatever servers I want. When Novell brought out NDS with version 4.0 of NetWare, everyone agreed it was dreadful. It took Novell two years to get their directory stable and probably another year to get it where it should be. Microsoft is back at that version one stage. It’ll take another two or three years to iron out the bugs.”
He has also noticed a growing interest in Novell network service applications from users who aren’t necessarily into NetWare.
“Lately I went to a demonstration of ZenWorks and Groupwise. One of the people there said, ‘That’s fine but it all runs on NetWare.’ The comment back was, ‘There are no NetWare servers here - it’s all running on NT.’”
If Harrison has spotted the start of a trend, it’s one that Novell is also betting its future on.
Revell says four years ago 84% of New Zealand revenues came from NetWare whereas today it’s 47.8%. NetWare is still the number one earner for the company, followed by Groupwise, ZenWorks and BorderManager. eDirectory has yet to make it on to the radar.
To survive Novell may have to turn those sales figures upside down.