Finally Fighting Back - Novell vs Microsoft

ENT, April 7, 1999 by Bill Laberis

Will people like my nephew, George, be the margin of difference between Novell and Microsoft as the two companies go head-to-head in the battle for predominance in the growing network directory market?

Why should George, a 24-year-old network professional two years out of school, matter in the first place? For an answer, let's first look back a few years.

In the late 1980s Novell was hot. Just as a degree from an Ivy League college almost guarantees an opportunity-filled career, possession of a sheepskin labeled Novell CNE - Certified NetWare Engineer - meant almost limitless job potential. No serious LAN was without NetWare, which commanded an almost monopolistic market share.

Then Novell got greedy, or reckless, or both. The company decided to take on Windows in the operating system arena, as though the failure of OS/2 wasn't a clear enough sign that the world didn't want another desktop OS. In addition, Novell took on Microsoft in the application area, buying WordPerfect and parts of Borland. It poured hundreds of millions of dollars into these and other failed efforts, letting NetWare languish while it tried to develop an all-purpose "super network operating system."

Novell succeeded in totally confusing and even alienating the thousands of loyal CNEs and independent software vendors who didn't want another desktop operating system or application suite to support.

Novell, luckily, got a second chance through the CNEs and ISVs who stayed loyal to the company, as difficult as Novell made it for them, and a huge Novell installed base of corporate customers. Under the brilliant leadership of CEO Eric Schmidt, Novell is back in a big way. When rolling out NetWare 5.0 in September, Novell trumped Microsoft by offering the best network directory services available. NetWare 5.0 garnered all sorts of independent accolades, including NetworkWorld's Product of the Year tribute.

Microsoft could only promise its Active Directory some time in 1999 as part of Windows 2000. While Microsoft fiddled in 1998, Novell was busy shipping 1 million new servers, according to International Data Corp.

Not only is the product good, but Novell is also pursuing a marketing strategy that is adding to NetWare's ubiquity. For one thing, it is readily and happily licensing Novell Directory Services to all interested parties. The company scored big when network giants Cisco Systems Inc., Lucent Technologies and Nortel Networks announced strong support for NDS late last year.

These switch vendors recognize a fundamental fact about directory services. The Internet and World Wide Web are fueling a tornado of support requirements for network administrators to handle, as networks open up beyond the intranet to include support for customers and suppliers as well. User companies moving swiftly into e-commerce are finding they need robust and flexible directory services that allow them to keep track of all the network devices and users. Without these services, there is no way to administer such intranet/extranets.

Network professionals want one point of network administration, supported by a strong directory services package. Today only Novell gives it to them.

Not only that, but Novell is also planning to broaden the appeal of NDS by offering support for Linux, in addition to its currently supported platforms, such as Unix, NetWare and NT. Later, Novell will unveil NDS support for Sun Solaris and for the heavy metal of IBM Corp.'s S/390.

Add to all this that once Active Directory ships - it will be a 1.0 release - it could encounter bugs or significantly lag NDS in overall strength. With all these hurdles, does Microsoft have a chance?

We're talking about Microsoft, so of course it does. This point takes us back to George. I spoke with him recently, and the big news from him was not another career-boosting job change but the fact that he recently became, in his words, "Microsoft certified." Microsoft certification for him and his friends is, in essence, the cache that Novell CNE was a decade ago.

Microsoft historically has been masterful at working with independent application developers to bring rich support and, therefore, credibility and marketability to its system software offerings.

That is the challenge for Novell for the next year: win back the hearts and minds of the ISVs and the Georges of the world. There are indications that Novell is making inroads with ISVs. The company boasts that it has nearly five times the number of ISVs today than it did 18 months ago, but that's a gain from a small number.

Like the Digital Equipment mantra of a decade ago, Novell Has It Now. But does it have enough of them? -Bill Laberis is president of Bill Laberis Associates Inc. (Holliston, Mass.) and former editor-in-chief of Computerworld. Contact him at bill@laberis.com.