Novell vow: be top Linux vendor

Provo-based Novell Inc. chief executive Jack Messman said the purchase of a Linux developer and a $50 million investment will help it become "the largest Linux vendor" as it fights a lawsuit over ownership of the computer operating system.

"I'm interested in growing the Linux market very fast and serving our customers," Messman said Wednesday in a radio interview with Bloomberg News. "We believe that having another large vendor like Novell in the Linux business helps grow the business."

Novell was sued Tuesday by Lindon-based SCO Group Inc., which is seeking royalties from companies including International Business Machines Corp. that use the Linux operating system. SCO claims to own the Unix code it says is used illegally in Linux software. In its slander lawsuit, SCO says Novell has filed misleading copyright registrations and made false statements to customers.

Messman says Novell will "vigorously defend the lawsuit" and "continue to pursue our Linux initiatives."

Those initiatives include completing a $210 million purchase this month of Suse Linux AG, which provides Linux software for computer servers that deliver Web pages and files on corporate networks and the Internet.

The deal prompted IBM, which distributes Suse Linux as well as Red Hat Inc.'s version of the operating system, to announce a $50 million investment in Novell in November.

Novell is negotiating a commercial license that will allow IBM, the world's second-largest software company, to distribute its Suse Linux products. Those agreements will be completed "pretty quickly," Messman said.

The fact that IBM will also continue to distribute rival Red Hat's Linux software is not a concern, Messman added.

"We believe it's in IBM's interests to have a healthy Novell and a healthy Red Hat," he said. "Red Hat is a competitor, but we'd both like to see the total market grow more than we'd like to compete with one another."

Messman expects the Suse Linux business, which he says was about $40 million in 2003, to grow at least 30 percent this year. Most of that growth will be among enterprise customers, he said. Shipments of servers running Linux will increase 17 percent in the next five years, according to market research firm IDC.

The "wholesale" adoption of Linux isn't likely, Messman said.

"The gating factors on the adoption of Linux are going to be on when new hardware needs to be bought or when software licenses are expiring," he said. "Those will be the trigger points that cause corporations to think about making the switch."

Messman also said he's not interested in taking on Microsoft Corp. and its market-leading Windows operating system.

"Microsoft's got many competitive actions they can take to slow down this (Linux) movement," he said. "But I think the key is that customers want choice. The desire for choice will drive adoption. Trying to take on Microsoft directly is not a very smart thing to do. We're going to focus on the customer, not on Microsoft."