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Technology Stocks : Novell (NOVL) dirt cheap, good buy? -- Ignore unavailable to you. Want to Upgrade?

To: MangoBoy who wrote (30475)	2/22/2000 3:31:00 PM
From: PJ Strifas	Respond to of 42771

<<NetWare itself aside, how do you see these various initiatives driving revenues?>> This is merely my opinion -- at best, an educated one :) I see NetWare OS sales continuing to hold or fall somewhat in numbers. In the percentage of revenues, I see NetWare OS sales shrink as Directory and Directory-based Apps gain larger and larger shares of the pie. This is not a negative but an example of the incredible growth still untapped in the Directory and Directory-based apps markets. The products I mentioned (i-Chain, digitalme) central to Novell's e-commerce plans will drive revenue not in a direct fashion (ie, the number of i-Chain licenses equals X $$ on the gross revenue numbers) but rather as a package. I see these products as part of a larger solution which includes NetWare OS sales as well as NDS seats (licensed connections) and even ZENworks family and ICS (caching) products. Once you can integrate products into a SOLUTION, revenue streams become inter-dependent driving more sales for the company. The alliances with Whittman-Hart and IBM to utilize their developers and consultants to facilitate the acceptance of Novell products as well as the leveraging of pre-existing Novell deployments into new revenue streams for Novell. Let's remember that 83% of the Fortune 100 companies USE NETWARE and NDS. Novell needs the people who can aid these companies to leverage their current NetWare networks into an e-commerce platform and not be enticed to move away from Novell. Here is where those alliances come into play (including Perot Systems). i-chain and digitalme extend Novell's reach beyond these companies and into the pure internet companies as well. Evidence CNN's inclusion of eDirectory into their myCNN.com website. This is more a showcase in my opinion where end-users can get personalize web content based on the Directory....what happens when you can translate that into the B2B e-commerce world? (when a business supplier can have an extranet for it's customers who log into a secure website and are presented with a webpage that includes customer specific information such as current account info, shipping details, customer service etc - all of this derived from the Directory). Novell needs to explore the need for a pure internet company (like ebay.com) where eDirectory and digitalme extend the end-user capabilities beyond the current settings on the internet into new features and services. Think if Silicon Investor utilized NDS instead of a database backend with customer scripts to provide personalized user experiences -- less overhead possibly. Much of this relies on the ability for Novell to further develop it's consulting division looking to IBM's Global Consulting arm as a goal. Remember that this division of IBM accounts for more than 30% of it's revenues! Novell consulting was responsible for less than half that percentage to Novell I believe...increasing the Consulting business has great benefits for the revenues. Products moving forward have good potential to generate more revenue streams for Novell. eGuide will be a great showcase product that may not become a revenue generating product like ZENworks but that's quite ok - Whittman-Hart's eCatalog is a product I would much rather see succeed because it lends more credibility to Novell's e-commerce position. (Inktomi has similar products in their ecommerce server and product search server.) From here, DirXML can become a product that not only will fill a business need within these solutions but also become a focal point for development (if Novell plays this right). (see novell.com what DirXML is positioned to do is allow NDS to work with other directories (like Lotus Notes or Exchange), creating a middle layer to exchange information without having to import that information into NDS and then have hooks from those applications dependent on the original information built into NDS. So you can use NDS to manage your Lotus Notes users without have to develop a way for NDS to talk to Notes directly. This is known as a meta-directory solution (what Active Directory proposes as the best case solution in managing networks). Because this product uses an open standard (XML) it can be developed to much easier than NDS. You can also apply DirXML to Active Directory :) I think ICS has great potential to drive revenues based on the OEM licensing path Novell has taken. Basically this gives the PC OEMs the ability to generate a new revenue stream into a market predominately handled by SUNW machines. Don't think for a moment that DELL, IBM, CPQ et all would not want a nice chunk of that market! If Novell can deliver on additional OEM-type products (webserver appliance, directory appliances, network storage appliances etc) and new revenue streams funnel into Novell's bottom line. Just some thoughts.... I wish I could quantify these initiatives into revenue numbers or even percentages of revenue. I can say this much, if Novell can begin to delive on my speculations, 25% growth is minimum -- 30%-35% revenue growth is more main line with 35% this higher line. Regards Peter J Strifas

To: MangoBoy who wrote (30475)	2/22/2000 4:19:00 PM
From: Paul Fiondella	Respond to of 42771

It's more a question of when the entire directory area really takes off with growth than it is of AD doing anything to Novell. The use of directories vs metadirectories in ecommerce and the use of directories to authenticate and manage end users/ customers over the net are the potential growth areas. I think any corporate customer implementing AD and looking at directories to unify geographically dispersed businesses must inevitably look at Novell, the leader in heterogeneous directory technology.