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

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To: Joe Antol who wrote (5148)11/24/1996 2:46:00 PM
From: Joe Antol   of 42771
 
To ALL: Here's some fodder for discussion (Hmmmm....):

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IBM PC Seeks Microsoft Partnership
(11/24/96; 11:50 a.m. EST)
By Edward F. Moltzen and Barbara Darrow, Computer Reseller
News

Las Vegas -- In a high-stakes pitch to Microsoft, the head of The IBM
PC Co. has proposed a new, broad-based alliance between the
companies on network operating systems, clustering technology and
services.

Samuel Palmisano, general manager of the PC Co., said his
manufacturing unit has already signed a new license for next year to
install Windows NT on its PC systems -- one of the few PC makers to
do so -- but he was looking for far more.

Palmisano said he was to meet privately with Microsoft Senior Vice
President and OEM strategist Joachim Kempin during the Comdex
show. There, he said, he would lay out his plans for a new relationship
between IBM's PC unit and the world's largest PC software maker.

"What we would really like to do, which we're going to talk about . . .
is that we work closer together beyond just the standard [licensing]
agreement with [Microsoft] to go after some opportunities for servers
together," Palmisano said, "where we go in and recommend a joint
IBM-Microsoft relationship for support of servers."

Microsoft executives would not comment on Palmisano's overture.

Although Palmisano did not eschew the idea of a long-elusive role for
IBM as a Microsoft Solution Provider, he said his idea was for a
broader-based working and marketing relationship built around
servers.

Laying the foundation for new cooperation, Palmisano said that the PC
Co. has agreed to join the so-called Wolfpack initiative with Microsoft,
Hewlett-Packard and others to develop clustering technology for a
broad range of PCs.

The PC Co.'s proposal comes at a time when IBM is seeing its server
business lose market share in the third quarter while Compaq and HP
show continuing strength in the higher-margin server market.

HP even leap-frogged IBM into second place in server market share,
largely because of a batch of defective hard drives from a third party
that IBM had to replace.

Palmisano was named general manager of the PC Co. earlier this year,
after running IBM's Integrated Systems Solutions Corp. subsidiary and
helping build a massive, $40 billion backlog in computer system service
contracts. He said he built a relationship with Microsoft while at ISSC
and wants to bring it to the PC Co., Somers, N.Y.

"In my old world, I had huge NT practice," Palmisano said. "We had a
great relationship. We'd go arm in arm on NT integration on servers --
IBM's and everyone else's -- because we were an integrator. We had
a great relationship.

"I want to do the same thing with them, except when I do it with [them]
this time, I want [them] to say, '[IBM] PC servers are good' . . . and
not, 'Compaq is better because they're a frontline partner.' "

Palmisano declined to say what specific programs he would put on the
table with Microsoft.

Earlier this year, IBM's software division stopped short of becoming a
Microsoft Solution Provider after pushing the idea. Every division at
IBM this year, however, has changed its strategy to become "platform
agnostic," primarily to tap into the huge opportunity for growth in the
NT market.

Microsoft CEO Bill Gates said in a recent interview that the
IBM-Microsoft relationship had not gone further because of the IBM's
reluctance to favor Microsoft software over IBM's software. "If you
want to be [a Solution Provider], you have to be willing to bid
Microsoft products," Gates said.
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Joe .... <whatta' ya' think?>
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