The Novell news is not news

The Novell news is not news

Summary: The success of Linux is not tied to the success of any particular vendor.

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Novell shares jumped 6% this morning as word spread it would sell itself in two pieces, perhaps in a couple of weeks.

A short item in the New York Post says only a "strategic buyer" will buy the Linux part of the business, while a private equity firm will take the rest.

There's only one problem with this news.

It's not news.

Way back in March, around the time Elliott Associates wrote the company offering to take it out for $1 billion, Matt Asay (then at CNET) said this was the likely outcome.

Novell's present price of $5.90/share, by the way, puts it 15 cents per share above the original Elliott bid, which came to $5.75/share.

Anyone looking for what is actually going on should also look at another data point, rumors yesterday that Red Hat is on the block.

What's happening is based on something Matt (again) reported over a year ago. While Linux is booming, most of its gains are coming from unpaid adoption, not support sales. This means slow growth for vendors who are selling Linux support contracts, like Novell and Red Hat.

In that kind of environment it's natural that brokers, analysts, and other bottom-feeders would get busy. And there's nothing easier than calling friends at the Post and telling them something is about to pop.

Whether it does or not, or when it does, the bread here was baked long ago, and is in fact getting quite stale. The success of Linux is not tied to the success of any particular vendor. The success is assured.

There are plenty of patent agreements around so that even an Oracle can't try to take it back at this point. Linux, whether you see it as free as in beer or free as in liberty, is free. And it's going to stay that way.

But it's hard to make money with free. Stock traders don't make money from free. So they're going to spread their FUD.

Just don't you worry about it.

Topics: Open Source, Software

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8 comments
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  • RE: The Novell news is not news

    "...slow growth for vendors who are selling Linux support contracts, like Novell and Red Hat."

    Umm... no. Red Hat grows fine. They grow double digits every quarter, if fact, last quarter was 20% growth off revenue and 30% growth of profits.

    Novell is declining because they chose to side with Microsoft and pay them royalties for unnamed patents. They even run Microsoft's anti-Linux errands. Spreading .NET across FLOSS world. So it is not strange that nobody wants to buy from them, like nobody wants anything from SCO.
    gnufreex
    • RE: The Novell news is not news

      @gnufreex Unfortunately, to Wall Street, Red Hat's growth is slow. Thus the rush to make them go away.
      DanaBlankenhorn
      • RE: The Novell news is not news

        @DanaBlankenhorn

        I think you are wrong. Show me another company that had double digit growth all the way through recession?

        How Wall Street express that Red Hat growth is slow? It is not with stock price. Stock is rising. It was $27 not so long ago, now it is over $37.

        Where is the rush to make Red Hat go away? You mean Microsoft is trying to make them go away? Yeah, they tried to do that in 2006 with Novell deal. They only made Novell go away.
        gnufreex
  • RE: The Novell news is not news

    The data point I don't understand is why anybody anywhere with inside information of success would set themselves up as publicly traded and sell oneself as a freedom fighter while taking advantage of peoples altruistic work efforts when somebody can take control of the company by force of the dollar? Publicly traded companies can be bought out by force by just anybody who worships the dollar sign. Linux is a community of altruistic efforts of people around the world. Good grief I even had someone comment on an idea I had from an island I never heard of in the south pacific. Please community stand together and don't let the dollar sign worshipers ruin linux "free as in....". What did Wall street reform reform?
    caosvsuncle
  • RE: The Novell news is not news

    Software for "rent" on the cloud by patent controllers and a likely top down decision for the supreme court to rule in a way that "freedom in software cannot compete with corporations and now rumors of supposedly altruistic companies switching mode to turn control. What on earth is going on in power land?
    caosvsuncle
  • The real question

    The real question is this "Is free as in beer software being gradually systematically exterminated from the top?"
    caosvsuncle
  • RE: The Novell news is not news

    Am I wrong or is this link pointing to a social networking project designed to character assassinate those standing up to the government corporate system?
    http://news.cnet.com/8301-13846_3-20016629-62.html
    What has open source and computing become?
    caosvsuncle
  • RE: The Novell news is not news

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