Novell Top-Level Shuffle Not a Surprise

Novell was on its way. At the company’s Brainshare event two years ago, then CEO Jack Messman took the stage and triumphantly declared that “Novell is back.” Turns out Messman was wrong.

Messman and his CFO Joseph S. Tibbetts Jr. were ousted
this morning from their positions at Novell. President Ronald W. Hovsepian is the new CEO and board member effective immediately. Dana C. Russell, vice president of finance and corporate controller at Novell, will serve as interim CFO.

The move did not surprise analysts
contacted by and may well serve as a new beginning
for a company that has been striving to re-invent itself in the Linux era.

Illuminata Analyst Gordon Haff said Novell is not in any more trouble
than it was before the Messman departure.

“This departure hardly surprises me,” Haff told
“Hovsepian has been on the ascendancy as someone who can
execute and make things happen for some time now. This is merely the next
logical step.”

Raven Zachary, senior analyst and practice head, Open Source at The 451 Group
thought the Messman departure had been long overdue.

“People have been talking about the failings of Novell for quite some time
and have pointed to his leadership as being a concern,” Zachary said.

Zachary is also concerned about Novell’s board choice of current
President Ronald W. Hovsepian to become the CEO.

“We’ll see if that’s permanent; I sure hope it’s not,” Zachary said. “Nothing
personal against the guy, but if they want real change in that organization
they have to bring an outsider in.”

The other concern for Zachary is that on the same day that they let go of their
CEO they let go off their CFO. In his view that’s never a good sign.

“We’re so focused on Messman, but what don’t we know about the CFO’s
departure,” Zachary asked.

Though its leadership may have failed, that’s not to say Novell itself
as a company cannot succeed.

“Novell has an incredible number of strong assets — in products, people,
customers and channels,” Illuminata’s Haff said. “But they’ve done a
spectacularly mediocre job of monetizing them for getting on 15 years now.”

The 451 Group’s Zachary also sees a lot of opportunities for Novell in the open source Linux group that it could potentially capitalize on.

“You’re seeing
more ubiquity in open source adoption in the enterprise; you’re seeing needs
for services whether that is support, consulting or training,” he said. “Novell has a large staff that can step up to that.”

Zachary also sees opportunity in open source beyond just SUSE Linux. In
particular, Novell rival Red Hat’s recent acquisition of JBoss could be a very good thing for Novell.

“Red Hat’s acquisition of JBoss is an opportunity for Novell to work even
more closely with IBM,” Zachary said. “Clearly the acquisition puts
pressure on IBM’s Websphere business.”

The departure of Novell’s top executive does not necessarily represent an
opportunity for its Linux rival Red Hat .

“I don’t think the average CIO is going to read the news
and say ‘Oh I better choose Red Hat,'” Zachary said.

That being the case, Red Hat does take its shots at Novell.

“One of Red Hat’s favorite points of discussion with
prospective customers is the challenges of Novell,” Zachary commented. “I
think Red Hat publicly doesn’t give much acknowledgement to Novell but
privately does.”

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