* The story behind WordPerfect's downfall
As I noted in the last issue, Novell and Microsoft recently settled their lawsuit in which Novell claimed that Redmond had used underhanded means to render Novell’s NDS for NT inoperative. Rather than face a trial it would probably lose, Microsoft paid Novell $536 million to go away. Jack Messman and Co., did go away, but came back four days later, suing Bill Gates et al for causing the downfall of WordPerfect through the manipulation of the Windows GUI and operating system.
Why didn’t Microsoft settle this while it was trying to remove most of its legal headaches? My theory is that someone in Redmond is bright enough to know that Novell has little chance to prevail. Microsoft didn’t cause the demise of WordPerfect, the WordPerfect Corporation (later aided by Novell) did. Here’s the story.
In the late 1980s, Microsoft DOS was the ruling operating system for desktops, and WordPerfect was the dominant word processor for DOS. But the advent of Windows 3.0, a GUI “environment” on top of DOS, as well as the success of Apple’s Macintosh, showed that a graphical operating system was the future of PC computing. Microsoft decided to pursue a two-pronged approach: It would develop Windows 3.x to sit on the DOS platform, while simultaneously developing a “new technology” operating system that didn’t rely on DOS. Microsoft found a willing partner in the latter undertaking in IBM, the same partner that made Microsoft’s success with DOS possible. What they worked on eventually became OS/2.
The WordPerfect Corporation wasn’t as big as Microsoft and it realized that it would need to develop for different operating systems and environments if it wished to continue to dominate the word processing market. Microsoft, which marketed Word, and Lotus, which had Ami Pro, were both developing GUI versions of their word processors. WordPerfect didn’t have the resources to simultaneously develop an OS/2 and a Windows 3 version, so it had to choose – and the choice was OS/2.
WordPerfect created an excellent OS/2 port of its word processor and many years later, it was still the best available for that operating system. Unfortunately, after IBM and Microsoft split the development of the new platform (with IBM retaining OS/2 while Microsoft created Windows NT), OS/2 quickly became a cult, or niche, product. WordPerfect then scrambled to get a Windows version of its software on the market. But the port to Windows 3.1 was so bad (scrolling a page, for example, you could see each individual letter snake it’s way from the bottom to the top of the page, and it was excruciatingly slow) that people moving to the GUI platform had no choice but to move to Word or Ami Pro. The WordPerfect Corporation was in bad shape.
At this point, Novell CEO Ray Noorda jumped in to rescue his neighbors up the road in Orem, Utah. Buying the WordPerfect Corporation, followed by the acquisition of Borland’s Quattro Pro spreadsheet, Noorda tried to compete with Microsoft for the office productivity market on the Windows platform. This crusade was so outrageous that it led to the ousting of Noorda from Novell. Novell then compounded the error by stating that it would divest itself of the productivity software by a particular date.
Now, when you announce that something “must be sold by” a particular date, people will wait and watch as the price drops. Eventually, someone at Canada’s Corel Corporation (known at the time solely for graphics software) thought the price was right and gave Novell $170 million for the products Novell had squandered over a billion dollars on just two years earlier.
WordPerfect and Noorda (supported by Novell’s board of directors which included a younger Jack Messman) killed the word processor and its progeny with very little help from Microsoft. There are some in Waltham who say that the debate over suing Microsoft for WordPerfect’s demise is what got Chris Stone his pink slip, but we may never know for sure.
There’ll be no second newsletter this week, as we all take a break to celebrate the American Thanksgiving. If you really need to read something about Novell, may I suggest the new Weblog that Ted (“The Reverend Ted”) Haeger, chief cheerleader for Novell’s new Desktop for Linux product, has begun called “Open Source Marketing with Reverend Ted” (http://reverendted.blogspot.com ).
