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

To: Frederick Smart who wrote (18421)	11/8/1997 9:13:00 PM
From: BP Ritchie	Read Replies (1) \| Respond to of 42771

Hi Fredrick! ... about the 'salmon' analogy >>>> As for me, the negative bias has been so thick lately I sometimes wonder why any of the old gang continue to hang around here. Are you that convinced all Novell shareholders are salmon - swimming upstream, fighting against time, only to die in the end? Please, please.... <<<< I continue to believe (for at least the last 3 years) that Novell's technology and Intellectual Property are the most valuable assets in the entire Networking Software Business segment. This Market segment is growing more rapidly now than any other part of the personal computer market ... and is probably going to increase that growth rate substantially over the next few years ... Novell is ideally positioned for an exponential revenue growth ... but I'm not sure the the people running the company understand the opportunity they have or what to do with it ... my big concern for the company's future is that it's management for the past 4 years seems completely unable to put these assets to work effectively. Until the spring of this year, Novell's management denied that there was a problem with marketing and sales ... sometime between the arrival of Eric Schmidt and the departure of Joe Marengi ... the company seemed to recognize the problem and pledged to take some action to fix it ... I don't think that either the BOD or the current senior management really intended to show any improvement in 1997 ... instead to use fiscal 1997 like a 'baseline' for future performance of the 'new team' and to focus on cleaning out all of the overhangning problems ... fiscal 1997 just ended, and I think we'll finally get to see what the new team can do in the next few quarters ... I expect that 1998 will be better than 1997, and expect that unless market share erosion is arrested within 1998 that the company or possibly it's assets will be sold ... because that is probably the best way to get some value for the shareholders ... I can't believe that the BOD will again ignore it's principal responsibility to the shareholders ... although the revelations of the last year have shaken my confidence in their judgement, they must be aware of the poor results accomplished in the past few years. There are lots of ways to make money from Novell's technical assets and abilities that don't require sales of Novell products ... Novell's people were talking with Intel a little less than a year ago, and I believe to IBM as well ... simply arranging a decent OEM re-sale deal with either of these companies could probably double the company's revenues. A merger with a company that knows how to market software and networking technology could be very rewarding for shareholders as well ... I know that several attempts were made, and in the process an 'attitude' problem among Novell Management was the probable reason for failure ... a comment attributed to Joe Marengi might illustrate ... when asked about NetScape's chances against MSFT in the 'server wars' he was quoted as replying that NetScape should be more worried about Novell than MicroSoft ... that was a few months before Novonyx was announced ... NSCP apparently didn't trust Novell for quite a while, the relationship seems to be improving now. I think that Novell's Management might be 'toast' ... some employees and investors might get burned, but that the enormous value of the technology and infrastructure that accompanies the large install base will ultimately yield significant returns to the investors that can hold on till this latest 're-start' either produces results or gets abandoned in favour of a buyout or merger of some kind. There's just too much value, and it's still growing! ... to believe that it will evaporate in the next year or two ... sooner or later it will be managed by someone that knows how to turn it into value for it's rightful owners (us shareholders) .... I'm growing impatient again though! PS ... I 'was' a lurker too until early this year when I realized that the company was in denial about it's marketing and sales problems, was treating MSFT like a trusted ally while MSFT was busily helping itself to Novell's VARs and customer base, and seemed to be embarking on a marketing campaign intended to 'take out' Novell ... while Novell's management insisted on a strategy of compromise and co-operation with MSFT instead of defending itself from what appeared to be a 'take no prisoner's' assault from MSFT ... I think that most of the people that were responsible for that 'brilliant strategy' are gone now ... and that the YE 97 results should be their final report card ... now I wonder if they've managed to make enough changes, hired and placed enough of the right people and changed the culture enough so that they will do as good a job of generating revenue as they do in programming ... I think they'll get one more shot at success their way, and hope the decision about staying independant or not gets made in 1998. I'll probably go back to lurking for a while, and hope for the best. I don't think I can help them anymore ... I did think I could help about 6 months ago. I do think that Joe Antol and associates helped the shareholders and the employees a lot more than the company senior management did during 1H 97 ... I tried to add to the effort too. There are/were some hurt egos at Novell because of the strong criticism, but I believe that the management changes made in 1997 would not have happened without that criticism ... seems to have made Joe a bit tired lately though. I believe that Novell's technology, Novell's engineers and programmers will make a substantial contribution to the development of networking around the world in the next decade ... I'm not so sure that it will be through Novell's products though ... and that causes me some concern about the safety of my investment that will keep my attention for the time being. Still very interesting times ... but, I'm not paying enough attention to my own business lately so ... it's time to let the 'new crew' take over. Are you volunteering? ... PS David Lethe can probably add some value as well.