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Technology Stocks : Novell (NOVL) dirt cheap, good buy?

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To: Joe Antol who wrote (10293)3/27/1997 11:32:00 AM
From: vinod Khurana   of 42771
 
Novell CEO search over

By Christine Burns
Network World, 3/24/97

Orem, Utah - It has been a long time coming, but Novell, Inc. last week finally filled its top job, tapping Internet visionary
Eric Schmidt as its chief executive officer.

Schmidt, a 14-year Sun Microsystems, Inc. veteran who most recently served as chief technology officer, will officially become
Novell's CEO and chairman on April 7. But he will make his
first appearance todayMarch 24 when he addresses thousands of the Novell faithful at the firm's annual BrainShare user conference here.

Analysts, customers, business partners and Wall Street investors alike are anxious to hear Schmidt's ideas for reversing Novell's slide from industry leader to a beleaguered company widely perceived as having missed the Internet phenomenon.

''I have already shed that perception myself,'' Schmidt told
/Network World/itals last week.''As of day one, I am going
to be out there selling the message that Novell equals Internet.''

Reaction to Schmidt's appointment has been overwhelmingly
positive. It is widely believed that his technical expertise and
vision are just what the doctor ordered for filling the post that
has been vacant since former CEO Robert Frankenberg left
the company last August.

But beyond the broad-brush assessments, who is Dr. Eric
Schmidt and how will his personality, talents and experiences
shape Novell?

Well, for one thing, this guy is smart. 'I've had six or seven hour-long conversations with him in the last four years, and I can honestly say I learned something every time, which you can't say about everybody,'' said David Smith, a research director of Internet strategies for the Stamford, Conn.-based Gartner Group, Inc.

What's more, he is articulate.

''He's one of those Leonardo da Vinci type of people who
have a universal interest in things,'' said Janpieter Scheerder,
president of SunSoft, Inc., a Sun division. ''But you'll never
feel he's talking down to you because he has a great way of
synthesizing ideas and making them understandable,''
Scheerder said.

And he is very low-key.

''He is not like the brash Scott McNealy. He's more of an even-keel type of person,'' said Michael Cowpland, CEO of Corel Co., a desktop suite firm based in Ottawa, Canada.
''Somebody like Scott coming in [to Novell] might raise a few
eyebrows because he is extremely outspoken. Eric is a different kind of personality.''

If there is any concern observers have about Schmidt, it is the
fact that he is a techie - rather than a businessperson - at heart. That is a charge Schmidt does not deny.

''I know it sounds boring, but it is what I do in my off time. I
actually work with computers,'' Schmidt said. ''My hobby at
the moment is being the systems administrator for the PC LAN I have in my house. I helped my daughter get on the Web.''

Schmidt plans to build the PCs he works with at Novell himself. It all starts with the right motherboard, he explained. When pressed on what he meant by that, he answered slowly. ''In...tel. It is going to take a while to learn how to say things like that,'' he said, coyly pointing out the difference between Novell's history in Intel-based chips versus his own with Sun's SPARC chips.

But friend, former colleague and now industry partner Rick Schell, vice president of engineering at Netscape Communications Corp. said Schmidt has always approached the competition with an open mind.
''I remember one time I walked into his office and he had an
NT box sitting on his desk,'' Schell said. ''He looks up at me
and says, 'Yeah, I know Scott [McNealy] hates these things.
But we can't do things in a vacuum, and if I don't try to understand this thing, nobody here will.''

Analysts said Novell needs a strong manager as well as an outspoken, technical visionary. Schmidt said he takes a very rational, objective approach to management and former colleagues said his tactful style works.

''He is a delegator. He works with people to define goals and
objectives and then helps them build strong teams to reach the objectives. He is not a micromanager in any sense,'' Schell said.

Schmidt hopes to establish a strong management team at
Novell, building around current president Joe Marengi. ''He is
a superb operational manager. Frankly, I would not have
taken the job without Joe being here,'' Schmidt said.
Colleagues also pointed to his uncanny ability to make tough
decisions regarding strategic direction - like Sun's attempt to
standardize Unix around AT&T System 5 or its push to
industrialize Java - and rally the troops to ride them out to
success.

''The thing I remember him most for is that he saved the Java
project several times from political death at Sun,'' said Arthur
van Hoff, CTO of Marimba, Inc. and former Java engineer at
Sun.

''There was always a lot of arguing at Sun about how to
spend money. It is important to have some good friends to
help you, and he has always been a good friend of the Java
project,'' van Hoff added.

Netscape's Schell said his friend's tenacity in those situations
reminded him of the time when Schmidt decided to get
serious about a mutual hobby, running, and train for the 1988
Big Sur International Marathon.

''Oh, yeah. Of course, he finished. That was his goal,'' Schell
said.

Senior writers Carol Sliwa, Chris Nerney and Paul McNamara and Senior editor Ellen Messmer all contributed to this story.
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