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It’s Not Easy Being Green: Life for SUSE with Attachmate

Attachmate buying Novell came as a bit of a surprise to industry watchers, but now that the deal is inked (but not closed) what does it mean for SUSE, openSUSE, and the rest of the Linux industry?

Now we know who’s buying Novell, but now what? The Attachmate deal, if it goes through, has some serious implications for the rest of the tech industry in 2011 and beyond.

First, a quick disclaimer: I’m a former Novell employee, and worked for the company for two years, ending in January 2010. I don’t have any stock or financial interest in the company.

Now onto the news. I’ve written a bit about this on NetworkWorld when the deal was announced on Monday, November 22. To say the least, I was surprised that the deal went down like this. I was fairly sure, and was hopeful, that Novell would go to VMware. The, as they say, “synergy” between the SUSE part of Novell’s business and VMware is pretty strong. Novell has been focusing a lot on SUSE Studio and virtualization through its “perfect guest,” virtualization strategy. The company hasn’t been focusing very hard on being a host platform for virtualization. That’s not to say you can’t use SUSE Linux Enterprise Server as a host platform — you can, but the focus has been on being a good guest.

Novell’s other product lines — identity management, groupware, and the PlateSpin product line — seemed like they could be a good fit as well. Mostly legacy products, but VMware could use those products to bring in more customers that are still using Novell and help virtualize those workloads.

But it was not to be. Assuming the deal goes through, Novell’s business units will be acquired by Attachmate in early 2011, and 882 patents will be sold to CPTN Holdings “a Delaware limited liability company and consortium of technology companies organized by Microsoft Corporation.” Well, that doesn’t bode terribly well. More on that later.

openSUSE and Attachmate

Let’s start with the community angle. Mergers and acquisitions are nearly synonymous with cost-cutting and layoffs. Given than Attachmate has no open source history to speak of, and no real track record of serious product development (as opposed to maintaining legacy software), you have to wonder how does investing in an open source community fit into this plan?

At first glance, it doesn’t. It’s taken quite a while for Novell to ramp up the openSUSE community, and the company still funds the bulk of SUSE / openSUSE development. In the past 18 months the community has taken a larger role in development — the tools and policies having finally caught up to the stated goal of encouraging community development. So it was concerning that the project now is in the hands of a company that might well find it impractical to invest in community contributions.

But the same day the announcement was issued, Attachmate put out a second statement saying that SUSE would operate as a separate business unit and its relationship with openSUSE would remain unchanged.

For now, at least, it looks like the openSUSE Project is safe and will continue to receive support from the SUSE business unit of Attachmate. But how safe is the SUSE business unit? Let’s move on to the business side.

The SUSE Business

Attachmate has said it will run Novell as two business units — SUSE and everything else.

Some have suggested that this is a sign that Attachmate is hoping to sell SUSE now that it’s been carved out of Novell. SUSE is currently part of the Security, Management, and Operating Platforms business unit that includes SUSE, SUSE Studio, Mono, OpenOffice (remember, Novell sells support for its Go-OO version of OpenOffice.org), PlateSpin virtualization management tools, eDirectory, and a bunch of other security and identity management tools.

It looks like Attachmate is going to reverse that and pull SUSE out to be its own entity. Presumably Mono, OpenOffice, and SUSE Studio go with SUSE itself. (This used to be the “Open Platform Solutions” business unit.)

SUSE Linux is technically on par with Red Hat, but it’s struggled to catch up to Red Hat in overall market share. The uncertainty about Novell’s future hasn’t helped in that regard — who wants to buy an enterprise operating system when it’s not clear whether the vendor will be around in six months, or who the vendor will be?

Now we know. But does Attachmate plan to hold on to SUSE very long? Magic 8-ball says no.

Here’s why: Attachmate isn’t a company sitting around with $2.2 billion in cash. It’s a private company with a lot of legacy tech. The Novell sale was, remember, triggered by an offer from Elliott Management Corporation (itself a big Novell shareholder). Guess where Attachmate is getting the money to buy Novell? Elliott Management Corporation, which will become an equity shareholder in Attachmate.

So, in the end Elliott gets in on the deal and will likely be looking to cash in as quickly as possible. This probably means trying to sell the SUSE business unit down the road. Who knows? Maybe VMware will end up with SUSE after all now that it can buy only the SUSE business.

This isn’t great for SUSE. We still have a few months of uncertainty while the deal closes, so the buyers who have been on the fence between SUSE and Red Hat are likely to stay on the fence, or go ahead and pick Red Hat. Unless Attachmate comes out of the gate very strong for SUSE once the deal closes, with a very aggressive product roadmap, SUSE may be consigned to second place forever.

That’s what I think is likely, but not what I’m hoping for. I’d love to see Attachmate put a heavy bet on SUSE and invest heavily in competing with Red Hat, restoring SUSE to its previous R&D glory days. Ramp up staffing and decide which areas of the Linux business that it will compete in.

Now for the real ugliness: What was sold to Microsoft.

What IP went to Microsoft?

It’s been disclosed that the IP assets that Microsoft purchased (through its dummy corporation) consists of 882 patents. See the 8K SEC filing.

Well, that’s not reassuring. Apparently the patents are worth at least $450 million to Microsoft. Either Microsoft is making a defensive move and trying to take a boatload of patents off the table, or it’s planning to be aggressive and start demanding that companies pay it for licenses to those patents. Or a little of both.

Microsoft has shown limited aggression, at least publicly, with its existing patent portfolio. It’s gone after a couple of companies for patents “on Linux,” but the company hasn’t engaged in wholesale warfare.

Note that some of the patents are related to WordPerfect. Maybe Redmond isn’t planning anti-Linux actions with the patents — perhaps the company is hoping to be aggressive with Oracle if Larry and company get too uppity with OpenOffice.org. Microsoft has largely accepted that it has to live with Linux on the server side, even if it doesn’t like it. This might, and I stress might, have more to do with Office than Linux.

Either way — it’s taking a big load of software patents and putting them in the hands of a company that historically has not been particularly friendly to Linux or FOSS. Microsoft has made some strides in the past few years, but it’s probably too soon to feel comfortable with those patents being available for offensive use against Linux and FOSS.

It’s also very unclear what this whole deal means in relation to the unpopular Microsoft/Novell deal. There’s a year left on the clock there, will the SUSE business unit continue the Microsoft deal, or renew it in some fashion? Or will the SUSE unit be free of the Microsoft deal and start chasing Microsoft’s market share more aggressively?

It’s Not Easy Being Green

No matter how you interpret it, things are about to get interesting with Novell’s old assets. SUSE Linux as a semi-independent player, rather than one-quarter of Novell (roughly), could be more agile and a real threat to Microsoft if SUSE is freed of the Microsoft deal. Though Novell does currently compete with Microsoft, if you look at the programs they have it’s clear that the focus is on capturing legacy Unix business and competing with Red Hat for customers.

To me, it makes more sense for Novell and Red Hat to focus on legacy Unix and going after Microsoft. Fighting one another for customers just makes it easier for Oracle and Microsoft.

As we head towards 2011, even with the buyer made public, there are more questions than answers. My guess is that by mid-2011 SUSE will either be sold to another major player, or on its way to an IPO. Here’s hoping that, one way or another, the lizard will survive and thrive and continue to keep the Linux market competitive.

Comments on "It’s Not Easy Being Green: Life for SUSE with Attachmate"

jsusanka

“To me, it makes more sense for Novell and Red Hat to focus on legacy Unix and going after Microsoft. Fighting one another for customers just makes it easier for Oracle and Microsoft.”

yes add to that some of the other distros like ubuntu, mandrake, pclinuxos along with the tools that open source has like nagios, cfengine, and webmin and you would have the enterprises with no problem.

a lot of enterprises don’t get open source and think you have to have a vendor for everything. they are trying to fit a square peg in a round hole.

you could manage and deploy an entire enterprise without one license fee. Imagine.

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ricgal

Microsoft <em> live with linux? Did you know that Microsoft em uses Linux-based servers for some of its email-screening services?

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ralphmartin

There are key applications that are always run on Linux or Solaris and most probably Fortune companies are using it no matter who they are. Though is funny that Microsoft might be using Linux.

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Nicrosoft uses linux only to write comptibility servises. No linux and other servers are used in MS infrastructure.

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