Earl Perkins

As I write this, I’m sitting in the airport on a Sunday afternoon waiting to take the flight to Salt Lake City, where Novell’s Brainshare event is kicking off tomorrow. Brainshare took a hiatus last year, but they’re back now. Perhaps not coincidentally, Novell also faces the task of responding to a recent bid for the company from hedge fund Elliot Associates LP. I’ve received many inquiries in the past two weeks or so regarding this event, and what it means for Novell. I believe that it underscores a much broader issue regarding customer perceptions of Novell viability and the changing market that they compete in. On the eve of Brainshare, I’d like to express a couple of thoughts on this.

1- Novell is one of the survivors from the early days of network computing, in spite of the drubbing it took at the hands of Microsoft in the network operating system and collaboration arenas. Founded in 1983, it has undergone a number of transformations (as any company in these eras did) and currently finds itself up against some formidable opponents in the technology areas it services. Having relieved itself of its services arm and focusing on software, it has had challenges making that transition as well, resulting in some long-time Novell customers  being concerned about real support from Novell, and perpetuating a perception of “instability”;

2- Novell has made several transitions throughout its history to survive, the latest being a move into an “Intelligent Workload” focus while riding a slow and gradual decline in collaboration via groupWise. While the balance between new technology focus and legacy technology support hasn’t always been the best, they’ve managed to remain a viable force in several areas, including resource, identity and access management. Again, however, these transitional periods are volatile, and feed the perception some have in the industry of a Novell in decline;

3- Novell’s current portfolio of offerings are a mix of the old and the new, with the new representing the innovation the company is known for. Management reorganization and a streamlining of the product portfolio in terms of marketing again contribute to a perception of a company that is reactive, rather than proactive;

4- The Eliott offer and Novell’s response (no thanks, not enough) represent the latest in the Novell saga. This event also contributes to the perception of a company that, while excellent from a software innovation perspective, is underperforming. Someone else wants to try their hand at “fixing” that.

Well, as an analyst, I have this thing about “perception”– it may or may not reflect the facts needed for good analysis and decision-making. Perception is a bad basis for critical decision-making as a customer, particularly if those decisions involve such matters as changing RFPs and tenders, migrating installed systems, and otherwise creating new relationships with new vendors. I wish it was that easy, to depend upon perceptions to give you the guidance required to make those informed decisions.

Some will say “where there’s smoke, there’s fire”. That may be true. I prefer to talk to clients and Novell partners, gather financial and statistical information regarding Novell’s perfomance, assess their products and product performance, attend Brainshare as much to talk to Novell clients as to hear about Novell technology, and finally gauge how much of the perception is based on the facts gathered. It may very well show that these perceptions are warranted. But don’t conclude that perception you hear about Novell as a declining company equals the need for fast and major decisions– the truth may be (and often is) more complex, and must be uncovered. Just like there was some thought and time put into the decision to buy and bring Novell into your enterprise, use the same approach if you decide to take them out.

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