Novell struggles with a tough tech turnaround strategy

This is what happens when you do not have a clear policy in place for product transitions. Novell will likely find themselves in the hot seat unless they can get their books balances a little better I suspect.

In the 1990s, the company was a leader in computer networking products that enabled desktop personal computers to communicate and share information. But in recent years, Novell, which also makes Internet security and identity software, has been trying to move from its own proprietary systems — marketed under the NetWare brand — to Linux, an open-source software platform. Linux has become increasingly popular among business, government, and institutional information technology executives who don’t like being tied into one company’s products.

It’s a turnaround that is still a work in progress. Novell closed the year at the top of a Globe 100 list no company wants to be on: It had the biggest profit-to-loss nosedive of any Massachusetts company. It swung to a $16.5 million loss last year from a $414.1 million net profit in 2004. For the first quarter of this year, Novell just broke even on sagging sales, with income from its legacy NetWare products plummeting 73 percent from a year earlier.

Industry analysts say that to the extent IT managers are still aware of Novell, few are putting the company at the top of their prospective vendor lists. And Novell faces a fierce and successful nemesis in Red Hat Inc. of Raleigh, N.C., which has been landing big customers for Linux-based computer systems…. Source: Boston.com

[tags]novell,red hat,turnaround,linux-based computer systems[/tags]