09/10 2:13P (DJ) =Corel Unit Stakes Its Future On Linux Operating System
By Rose Tamburri
OTTAWA (Dow Jones)--Corel Computer Corp., a unit of Corel Corp. (COSFF), is staking its future on a fledgling operating system known as Linux.
The company hopes to capitalize on the growing popularity of Linux to sell its newly released NetWinder computer and a variety of software applications that Corel Corp. is developing for the Linux market.
Ron McNab, vice-president of Corel Computer, told Dow Jones that the company is selling "hundreds" of units a month of its NetWinder computer, which was introduced in June. Sales are expected to pick up soon and Corel Computer may be profitable by late 1999, McNab said.
That's good news for parent Corel Corp., which has been hard-hit by its battle with Microsoft Corp. (MSFT) for a share of the office suite market.
Corel Corp., which has reported six consecutive quarterly losses, is hoping that the future success of its computer division will help revive the company's fortunes. But McNab plays down the importance of Corel Computer to its parent company. "I don't see ourselves as the savior of Corel. But we're not the weak link either," he said. "We're definitely going to be making a major contribution to Corel's growth and health," he added.
Thursday in Toronto, Corel Corp.'s shares are trading at 1.90, up 0.10. Corel Corp. canceled plans earlier this year for a public offering of shares in Corel Computer and said it plans to reintegrate the unit as a division of the parent company.
(MORE) DOW JONES NEWS 09 -10 -98 02:13 PM
The NetWinder, the first of several Corel Computer Corp. products that will run on the Linux operating system, is essentially a small but powerful computer. But it requires very little electricity - about the same as a nightlight - and gives off less heat than a conventional desktop unit, said Ron McNab, Corel Computer vice-president.
As a result, the NetWinder could cut a company's computer operating costs by as much as 50%, McNab estimated. That "is a pretty compelling financial reason" to purchase the NetWinder, McNab said.
The first version of the NetWinder was a development model aimed at
experienced Linux users. A updated version due out later this year, which will include Corel Corp.'s WordPerfect wordprocessor, is expected to have a broader appeal. McNab said. Corel Corp. eventually intends to make available its entire WordPerfect suite, which includes various software applications, for the Linux market.
The company also expects to introduce soon a Linux-based Web server for Internet service providers.
Linux is a seven-year-old operating system and a direct competitor of
Microsoft Corp.'s (MSFT) Windows operating system. But, unlike Windows, the Linux source code is available to users free of charge. Linux, which has an estimated 7 million users, is kept up by a global community of software engineers.
Corel Computer, which has 78 employees, originally set out to develop a network computer based on the Java programming language. But repeated delays in developing Java required Corel Computer to reassess its plans, McNab said.
He said the company still intends to bring out a network computer.
-By Rose Tamburri; 613 -237 -0668
(END) DOW JONES NEWS 09 -10 -98 |
