<Novell is DEFINITELY in deep doo-doo.
Once Microsoft either develops or buys Directory Services, Novell will finally have had the final nail in its coffin.
Like it or not, NT will reign supreme.>
I continue to faithfully read every post on this board, along with all the other information I can get on Novell and other NOS companies. I haven't posted lately because there are people here who are very knowledgable technically and really provide better information from the technical perspective than I will ever be able to. Same with fundamental and technical analysis of the stock, it's been done to death and we're all waiting for PROFITS (not just sales) to make the stock attractive. It has to be profits because the analysts (and the market as a whole) are no way technically adept enough to understand the meaningful differences in MSFT vs NOVL, and being typical Americans, are brainwashed by MSFT omnipresence (They must be the best, they are everywhere). They do though, very easily understand which companies are making PROFITS each quarter, as they would like some of these profits for themselves if at all possible. I would like to take two steps back and give some thoughts from the non-tecnical user/customer perspective in a non-emotional setting. This is certainly not the only perspective, but a valuable part of the total picture:
1) What is the whole argument about, MSFT vs NOVL, or any other NOS? Is the whole country experiencing a rapid paradigm shift to client/server processing for MISSION CRITICAL data processing. I do not see it yet, not in my own company and not in others I visit. I still see a lot of green-screen and COBOL-type applications (STILL 82% of mission-critical nationwide). The only company I have visited and saw real mission critical use of a GUI/Client server type application was at the MCI telephone network trouble-ticket call center in CARY, NC (there is also a secure room for the FAA in this facility). It worked and it was impressive, but they were doing it on X-Windows and Unix. It was very expensive to build, and expensive to maintain, but it allowed a $20,000 dollar a year user to graphically drag and drop to restore network circuits or reroute voice/data and it was MISSION CRITICAL RELIABLE, THEIR SURVIVAL AS A COMPANY DEPENDED ON IT. When I asked them about NT, they started laughing. I was told Novell had a good chance at really being successful if they stayed focused on a mission-critical application platform. Even though they were not there now, the consensus was they had the best chance of making it. I see many companies that are under a crunch due to 2000 date change pressure, ie, do we budget to go in and clean up the COBOL code, or do we develop new client server apps to be ready by 2000, or do we do both simultaneously in case the client server doesn't work (very expensive). I think the way this plays out is going to have a lot to do with the profitability of MSFT and NOVL, though I am not sure how it will play out. I do know that there are no "magic bullets" out there to go in and change "2000 date" problems in code on an automated basis, so this adds to the complexity of which way to go.
2) I work for a smaller company (400 employees, 48.5 million sales fiscal 1996). We tried NT, it is coming out, we are now on NW 4.1 and looking at Intranetware. We are still on green-screen for order entry, inventory processing/control. Our PC network is for office functions and 2 browser applications. We are facing what companies large and small are facing during the next 3 years, and I don't see NT as the savior, or even the choice, even the next rev (whenever it comes out).
3) Bob Frankenburg - I felt it was a mistake to show him the door when it happened, and I said so, but it's done. Now, in addition to not having a "charismatic go-getter in place" , there is no plan period, and we are net worse off than we were. Obviously all of the peanut gallery at Novell who bitched about him had no real plan to implement, they were just using him as the fall person. I am glad he was there as long as he was, and we will make money because of the work he did, if something can be done in terms of a real leader during the next few quarters.
4) E-mailng Marengi - noble effort, but a waste of your valuable time.
5) Lucent Technologies - WE DO NOT WANT A SWAP WITH THEM UNLESS AT A SUBTANTIAL PREMIUM - They were a leader when AT&T had the monopoly on phone switches and while they make solid equipment, there are companies out there now (Aspect Telecommunications, Periophonics, Telrad), who are gaining ground at light speed. I really don't know if the culture that is embedded at Lucent is conducive to competing with multiple vendors of switching. I deal with them weekly, and there mindset is "We do it this way because that is the way we've always done it". They are also in some disarry since the divestiture from AT&T. I wouldn't touch the stock.
6) Risk vs Opportunity Cost - I see people on this board who say "I've waited two quarters, my money should be elsewhere". Yes, it could be anywhere, but where, and at what risk. I still think we have another year at very low risk with strong upside potential. If we double or more in a year with low downside potential (assets and cash) it is one of the best common stock plays around. I do not see this in many other tech companies at this moment.
These are my thoughts, I try not to spam up the board, so one big post. I continue to read everyday and really value the information that is exchanged. I do still feel positive about this stock.
Thanks
JWW
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