Novell: Linux Breaks Even, Microsoft Deal Slumps

Novell vowed last year that it would begin turning a profit on its Linux business by the end of this year. Now it says it’s poised to do just that, and ahead of schedule.

But not everything is rosy in the world of Linux for Novell. Three years ago, the company entered into a Linux reselling agreement with Microsoft for Linux support subscriptions. Now that the agreements are up for renewal, they’re giving the world an idea of where Novell is making its Linux revenue — and it’s not from that groundbreaking, controversial deal. Datamation takes a look.

Novell (NYSE: NOVL) executives said this week that it’s seven-year-old Linux business has finally broken even — making good on promises made a year ago.

But it hasn’t been an easy trek to begin making money off of Linux, and one factor may weigh against Novell’s Linux business going forward: The waning revenue from its landmark 2006 agreement with Microsoft to begin reselling Linux support subscriptions.

This week, Novell reported its first-quarter fiscal 2010 earnings for the quarter ending on Jan. 31. Net revenues came in at $202 million, a decline from the $215 million reported for the first quarter of 2009.

Read the full story at Datamation:

Novell: Linux Breaks Even as Microsoft Deal Revenues Wane

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