Novell catches Salmon to beef up services

Novell is hoping its strategy to push Linux to UK enterprises will gain momentum with the acquisition of British IT services company Salmon.

The deal, announced on Thursday, will align Salmon with Novell's Cambridge Technology Partners consulting business, although the company will retain its own branding for the time being. Terms of the transaction were not disclosed. Salmon has around 130 staff, both permanent and contract, and is based in Watford.

The Salmon acquisition should help bolster Novell's consulting presence in the UK, which is relatively limited at the moment, according to Salmon's managing director Chris Harvey.

Salmon plans to use Novell's open-source expertise and products to tap into the growing demand for Linux among UK companies. The retail and insurance specialist will migrate some of its existing products onto Linux, and has other projects planned for the open source OS further down the line.

"A lot of people are talking about Linux at the moment. We are getting a lot of interest from new customers in particular; around two in five customers are enquiring about it at the moment," said Harvey.

He also explained that the company is planning to launch a hosted underwriting service for the insurance industry which would look to build the infrastructure around Linux to capitalise on the potential cost savings associated with the open-source OS.

Salmon also wants to use Novell's massive European sales operation to drive sales leads, said Harvey. The company is planning to expand its customer base to include telecoms companies in the near future.

Novell's Salmon acquisition is part of a significant investment to develop its services operation in Europe, according to Novell UK MD Steve Brown.

"Salmon have broad skills in Web services and a European presence in carrying out client work. Insurance is a good market for them and they are on good terms with Lloyds. They also have retail experience," he said. "With our own European presence they will have a more far-reaching network in Europe."

The Salmon acquisition also fits into the broad Linux services-based strategy that Novell adopted following its acquisition of both Ximian and SuSE over the last 12 months.

The former networking specialist is positioning itself around the services and consulting required to make open-source software enterprise-ready.

In a recent interview, Novell's chief executive Jack Messman described Linux as a "rising waterline" -- meaning that the commoditisation of software, and the rise of cheaper open-source operating systems, will spread up the stack of applications to include other software such as databases.

These changes are forcing software vendors to shift business models based around selling code to realign around the services required to make community-developed applications usable in the enterprise, explained Messman.