Deal isn’t about the customer

At the heart of most businesses lies a mish-mash of different technologies through which information – the life-blood of modern business – courses. But when those technologies don’t connect into each other, businesses suffer – they are not able to get the full benefit of the data they work so hard to collect.

When it comes to a choice of operating systems, for most organizations, it’s not an either/or decision. Most IT server rooms are filled with an assortment of hardware running a plethora of software programs, and very few businesses remain a completely Windows, Unix or Linux shop.

That’s why the partnership between Microsoft and Novell to work out interoperability kinks between Windows and Novell’s brand of Linux is welcome news for IT managers. Unfortunately, the deal is less about catering to customer needs than it is about two companies uniting against a common enemy, in this case, Red Hat.

Under the agreement, Microsoft and Novell will work together to ensure the compatibility of Microsoft Office and OpenOffice. They will also work on virtualization and Web services for server management technologies.

They will both offer virtualization technology with their respective products – Suse Linux Enterprise server and Windows server – to run each other’s software.

But the agreement is about more than making sure the two technologies gel with each other – it’s also a business arrangement under which the companies will also promote each other’s products.

Microsoft will pay Novell US$240 million for Suse Linux Enterprise Server subscription certificates, which it can use, resell or distribute to customers. Microsoft will also spend US$60 million over five years on marketing Linux and Windows virtualized systems and another US$34 million for a Microsoft sales force devoted primarily to marketing the combined offering.

The deal also encompasses a patent co-operation agreement, under which Microsoft will pay Novell US$108 million up-front and Novell, in turn, will pay the software giant US$40 million over five years.

Though the agreement could spell fewer interoperability issues for IT shops that run both Suse Linux and Windows, the spirit of the Microsoft-Novell agreement isn’t exactly one of benevolence and concern for end users. If that were the case, Red Hat might have also been invited to the interoperability table.

“The impetus from this event really comes from our customers,” said Microsoft CEO Steve Ballmer during the press conference announcing the agreement. “As CEO of Microsoft, I certainly recognize that Linux plays an important role in the IT infrastructure of many of our customers, and will continue to play an important role. We have customers who use a mix of technologies to manage their businesses, and they demand strong interoperability amongst all their systems.”

This is true. But the Linux community consists of more than Novell’s Suse Linux.

In fact, Red Hat is a more popular flavour of Linux than Suse in Canadian companies, according to IDC Canada.

Some have suggested that’s precisely why the Redmond giant decided to throw its weight behind Novell, and they’re probably right.

As Ballmer said in the press conference, “We definitely want those customers who are combining Windows and Linux to choose the Novell Suse product line.”

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Jim Love, Chief Content Officer, IT World Canada

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