Who's buying Novell? Place your bets

Somebody's buying Novell: Is it Oracle, SAP, IBM, VMware, or someone else?

Rumor has it that Novell has tentatively reached a sale agreement that would split the business in two, and sell the Linux half to "a strategic buyer." Assuming the deal goes through, who's the unnamed suitor, and what does it mean for the SUSE Linux business and the openSUSE Project?

A quick disclaimer: Novell is my former employer. I left the company at the end of January, and as far as I know the $2 billion offer from Elliott Associates wasn't even in discussions then. At any rate, I don't have any inside knowledge (call me, Ian...) so what you're reading here is pure (if educated) speculation. I don't have any vested interest in the buyer, except a hope that my former colleagues will land with a company that will treat them well and respect the openSUSE Project.

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Let's look at a couple of potential buyers. Novell has recently struck strategic deals with VMware, and has a longstanding partnerships with IBM and SAP. Oracle is also in perpetual acquisition mode, and it might want to chow down on the SUSE Linux business as a nice dessert following the Sun deal. Why undermine just one nacent open source community (OpenSolaris) when you can take out two (openSUSE) in one year?

Let's start with Oracle. Oracle has its Oracle VM platform that is Xen and Red Hat Enterprise Linux (RHEL) based. Well, RHEL-based in the form of Oracle's rebranding of RHEL. Oracle's "Unbreakable Linux," is supposed to be fully source and binary compatible with RHEL, without all the pesky and expensive development effort that Red Hat actually puts into its distribution.

One little problem with that, going forward — Red Hat is chucking Xen out the window in favor of KVM. Either Oracle will have to switch and invest in some development, or Oracle will have to break binary compatibility with RHEL after the RHEL 6 release. If Oracle is forced to make a change here, it might as well think about adopting a different Linux distribution. Novell still hasn't fully put its money on either platform, preferring the "perfect guest" strategy to run on all virtualization platforms.

Perhaps it's optimism, but I'm saying it's unlikely that Oracle is going to nab the SUSE business. If it does, I don't hold out a lot of hope for the openSUSE Project at all. Even if Oracle did decide to continue it at all, Oracle's style of dealing with community is terrible. It would be an enormous setback for the progress that the project has made so far, and it seems very likely the company would see an exodus of talent in much the same way that Sun did after it was acquired.

IBM is another possibility. IBM has maintained partnerships with all the major Linux companies, SUSE, then Novell, Red Hat, and Canonical. Buying one of the three and doing its own distribution is not going to go over too well. It might even put Red Hat in the sights of one of IBM's competitors, and nobody really wants that. But IBM and Novell are pretty tight for the Linux on the mainframe business, so it might decide that having SUSE in pocket would be a good thing. If IBM is serious about the OpenOffice.org fork, Symphony, then it might also want to look at getting some of the Novell folks who've been behind Go-OO.org.

It would probably push HP, Dell, and others farther towards Red Hat or other distributions, though. IBM might be a good steward for the openSUSE community, certainly far better than Oracle.

SAP is another possibility. They've also struck strategic deals with Novell for SUSE, and have some big customers on SUSE Linux. But SAP also has deals using other Novell products, which seems at odds with the rumor that the company is only buying the Linux bits with everything else going to investment firms. If SAP were going to buy Novell, it seems more likely that it'd just buy the whole company and get it over with.

This brings me to the final choice I'm tossing in the hat: VMware. VMware has been buying other open source solutions lately (Zimbra, SpringSource) so it doesn't seem like a stretch to say that the company might want to add SUSE Linux to its collection. VMware might also want to have a Linux distribution to help its customers and partners build more appliances that will run on VMware's virtualization products.

And there's no nicer solution on the market for creating appliances than SUSE Studio at the moment. It seems to me that SUSE Studio would make a really nice addition to VMware's appliance marketplace. Red Hat is well underway building its own virtualization solutions, so that would also help VMware compete with the number one Linux vendor.

How would it go for the openSUSE Project and SUSE Linux in general? My guess is that things would go as well, if not better, as they have with Novell at the helm. Perhaps better, because Novell has had a bit of an identity crisis at times trying to figure out how all its component business units fit together. SUSE would fit into VMware's strategy quite nicely — at least that's how I see it from the outside looking in.

And a quick mention, since it's sure to come up — what about Microsoft? This seems terribly unlikely. It's hard to imagine how Microsoft would get past the antitrust issues, to begin with.

So my money is on VMware, but I could very well be wrong. It might be IBM, SAP, or (please, no) Oracle. Or it might be another player I haven't thought of. Any guesses?

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