Allison Jeremy Resigns

Some are suggesting that the planned acquisition of SuSE Linux AG by Novell Inc. could reignite an old battle between Novell and Microsoft. Novell owned a competing network operating system for file and print services, which lost market share to Windows in the mid-1990s. It's a blow Novell has struggled to recover from.

Certainly, what's good for Linux is bad for Microsoft, and if Provo-Utah-based Novell does a good job managing the acquisition, it will make Linux stronger because the result will be two strong enterprise Linux competitors -- Red Hat and the newly retooled Novell, experts say.

"For most IT executives in shops that are primarily dominated by Microsoft Windows, and you like Microsoft, this merger won't change anything," said Gordon Haff, a senior analyst at Illuminata, a Nashua, N.H., consulting firm. "But if you're a Microsoft shop and you are considering some Linux, this is a further indicator to you that Linux in the enterprise is very real."

The acquisition will be good for Novell, because it will help strengthen its position in the Linux market and help revitalize Novell as a company, said Steve Kleynhans, a vice president at the Meta Group, a Stamford, Conn., research company.

And Novell is saying that Nuremberg, Germany-based SuSE Linux will benefit by gaining access to Novell's wide distribution channel and entry to a great many enterprises. If Novell can combine the two companies successfully, it will make Linux stronger.

Still, experts caution that Novell has a bad track record when it comes to mergers and acquisitions. "Certainly it's a different company than back in the day of Word Perfect and Unix," Haff said.

There is a risk that Novell won't come up with a positive business formula once it pulls both companies together. "It all looks good on paper, but there is a chance [Novell] can't get a product that everyone can get excited about, and one that makes a good business model," Haff said.