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NOVELL MOBILISES UNIX IN THE BATTLE WITH MICROSOFT AND NT

The indicated $353.6m in shares that Novell Inc proposes to pay for Unix System Laboratories Inc is high for a company that does only some $80m in annual turnover, but Unix Labs is clearly unique. The letter of intent calls for Novell to exchange the small shareholdings in Unix Labs held by about a dozen leading lights from the Unix world, for shares in itself, so that it will own the company outright. Novell already had 50% of Univel Inc, the joint venture with Unix Labs pushing the Destiny desktop Unix. Novell said the acquisition could result in it taking a one-time write-off of up to $250m in the fiscal quarter in which the deal closes – expected to be first quarter of 1993. Based on the current Novell share price, AT&T says it expects to record a gain of more than $100m in net profit at the closing. Outstanding Unix Labs stock options and other equity incentives would be exchanged for Novell stock or options or rights to acquire Novell stock. A series of telephone briefings that accompanied the announcement failed to explain exactly what plans Novell has for its prospective acquisition although a gentle convergence between Unix and the NetWare network operating system was mentioned. The result will most likely be a series of common management and application development interfaces that will help users and vendors build heterogeneous networks. That the Open Software Foundation’s Distributed Computing Environment – now endorsed by Unix Labs – can be seen as competing with Novell’s schemes for distributing application, was tackled briefly with the assurance that DCE can be implemented on top of NetWare. Brushed aside too were any worries in the Unix community that its beloved operating system would be subject to the whims of a single company: Unix Labs says it sought and repeatedly received assurances from Novell chief Ray Noorda that Unix would continue to be an independent operating system and that it would be available on an equitable basis. Nonetheless, should the deal go through then Unix will become a Novell trademark. The takeover has the blessing of the Unix Labs board, which includes representatives from Ing C Olivetti & Co SpA, Fujitsu Ltd, and the Massachusetts Institute of Technology, but the merger must still be approved by Unix Labs’ other shareholders, which include Sun Microsystems Inc, Amdahl Corp, ICL Plc, Taiwan’s Institute for Information Industry, Motorola Inc, NEC Corp, Oki Electric Industry Co Ltd, Tata Consultancy Services and Toshiba Corp, as well as the appropriate regulatory agencies. Unix Labs will be run as a wholly-owned subsidiary at its present base in Summit, New Jersey. Its current relationships with its OEM customers and organisations such as the Open Software Foundation, Unix International Inc and X/Open Co Ltd will be left intact, as will its early access programmes, Novell insists. Its product line, including the Tuxedo transaction processing monitor, will be separate from Novell’s. However, Novell, which claimed it was acting on the urgings of its customers, is expected to press the integration and interoperability of NetWare and Unix, the development of common management framework and common application framework binary interfaces to put at the service of third-party software developers and mission-critical accounts intent on downsizing to distributed systems, with NetWare to be cast in the role of the network services provider, Unix as the application server.

Positive reaction

The desktop will be anybody’s game. Novell is promising tighter integration with MS-DOS, Windows, OS/2, Macintosh System and Unix clients. On the day the merger was announced, Unix Labs president Roel Pieper, who will report to Noorda, claimed a positive reaction to the move from AT&T’s old enemies Hewlett-Packard Co and IBM Corp, who always fretted over AT&T’s control, its hardware biases and its association with the bad blood that drove the industry apart. He told our sister paper Unigram.X that the Novell takeover gives these companies a more logical and fundamental opportunity to line up more, hin

ting that it may foster things the market hasn’t seen yet. It is believed the alignment of Novell behind Unix will make it more difficult for Microsoft Corp to run roughshod over the industry. Novell hopes to lend the company help with marketing, education, services and infrastructure to accelerate the adoption of Unix. Sun Microsystems and its own software facility, SunSoft Inc, remain the merger’s wild cards. Pieper tried and failed to get hold of them to brief them and to gauge their reaction. Sun’s alliance with AT&T, the original cause of the bloody Unix Wars, has now turned almost 180 degrees with Sun looking increasing out in the cold.

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CBR Staff Writer

CBR Online legacy content.