Novell’s annual user event, BrainShare, took place this week in Salt Lake City, Utah. President and CEO, Ron Hovsepian sat down with linuxdlsazine’s Bryan Richard to talk about patent protection, responding to customers, and competing with Red Hat.
[linuxdlsazine] One of the things that I think I’m going to take away from talking with your executives this week is that, from Novell’s perspective, working with Microsoft as a partner is no different than working with any other vendor that sells a competing product.
[Ron Hovsepian] Absolutely. That’s something that gets lost because of who we’re working with in this case. But from our point of view this is no different than us having a partnership with IBM on Linux but competing with them on identity [management]. That’s how I see it when I look at this from a pure business venture.
[LM] Related to things getting lost in translation due to the relationship with Microsoft, you and team have recently had to clarify Novell’s position on a number of items being reported in the press. Why has there been so much confusion?
[RH] Unfortunately I think we didn’t do a good job up front explaining that the Microsoft agreement was going to be a way for us to grow the Linux customer base.
[LM] Is the idea that the Microsoft-Novell alliance is growing the Linux market something that everyone is going to have to come to grips with?
[RH] I’m not sure I’d put it in those terms, but growing the Linux market and responding to customer requests were our primary drivers for partnering with Microsoft. Let me give you an example to illustrate that.
Prior to the agreement with Microsoft, I personally witnessed four very big customer losses to Windows that I was directly involved with. I thought we had those deals closed. I would go so far as to say that I knew we had them. But somehow they got smothered at the top of the house [and the business went to Microsoft].
Following those losses when we went into the agreement with Microsoft we focused on interoperability, that’s what I care the most about. My thinking is that I can differentiate us with the customer based on that, if we do a good job in engineering the solution. And then Microsoft asked us about the patents. We thought about it and what we concluded was, 1) we’re not going to violate GPL2 because we need our community and 2) we’re open to doing something good for our customers.
We’re very committed to protecting not just our customers but open source in general. We’ve spent millions of dollars and continue to spend heavily in continued litigation against SCO. We’ve also put additional money into the Open Invention Network [as another layer of protection]. So with the Microsoft alliance I was comfortable with including the patent agreement because with those four customers losses that I mentioned, who won there? The community didn’t win. Novell didn’t win. Red Hat didn’t win. Windows won.
It turned out that an additional layer of indemnification was needed. And I’m confident that if we would have had the agreement with Microsoft in place beforehand, we would not have lost that business. And Linux adoption would be bigger because of it.
[LM] When you took on the role of Novell’s CEO in June of last year, I believe I saw one financial analyst comment that said something to the effect of, you don’t have a lot of time to turn things around — one, maybe two quarters. Do you feel a need to accelerate your business?
[RN] The “sense of urgency” is the phrase I use with the Novell employees. You have to have a great sense of urgency in this industry because it moves very, very quickly. We saw some great results with Linux in the forth quarter and now we just need to keep building on that.
[LM] How much of your continued success in the Linux market do you believe is dependent on displacing Red Hat?
[RH] Most of our recent growth has been greenfield. We have some head-to-head battles with Red Hat; it’s inevitable. But all-in-all I believe both of can grow in this market pretty freely. I think it’s healthy for the market for both of us be successful.
While we compete on certain occasions, we work with Red Hat behind the scenes from a community perspective and that’s not going to change.
When we compete against Red Hat we want to win but, in general, we want Linux to win.
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