Corel's chief executive is looking to put his firm's software struggles in
the past and is banking the future on the Linux operating system.
Corel, a software maker based in Ottawa, Canada, is one of several firms
riding the wave of Linux mania, driven in part by the
blockbuster initial public
offering of VA Linux Systems last week. Corel ended the day up 8.40 percent to 33.06 in trading, after earlier touching 44.5.
In the next five years, "half of our revenue will be coming from Linux,"
CEO Michael Cowpland told CNET News.com in a wide-ranging interview. "We will continue to work with
but we hope to be the company that bridges the gap for users who want
products for both Windows and Linux."
Linux is a Unix-like operating system collectively developed by Linus
Torvalds and countless other programmers. It's getting more popular in
server computers, and is used by 10 million to 12 million people, according
to estimates. Some companies believe Linux will compete in the desktop
computers where Microsoft Windows currently prevails.
Corel, facing unrelenting competition from Microsoft, hopes that Linux will
provide the salvation that Java didn't. The company began but then
abandoned an effort to translate its software to the Sun Microsystems Java
environment, a move that would have allowed Corel's software to circumvent
Windows and run on any Java-enabled computer.
But that effort faltered, and now the company believes hitching itself to
the rising Linux star will carry Corel past Microsoft. Battling with
Microsoft is nothing new for the firm. Years ago, Corel bolstered its
software effort with the acquisition of the WordPerfect suite. WordPerfect,
the leading word processor in the days of DOS, lost its market share to
Microsoft with the ascendance of Windows.
Back in the Linux realm, Cowpland also dismissed rumors that North
Carolina-based Linux supplier Red Hat is looking at Corel as a possible
"We have a phenomenal user base, and we're bringing that to Linux. We've
got five times more Linux developers than Red Hat. There are no
negotiations going on with Red Hat," he said.
Cowpland also briefly commented on allegations that he took part in
Canada's most powerful market regulator
charged Cowpland with three counts of
violating securities law and laid another charge against his personal
holding company. If found guilty, he faces up to two years in jail, a fine of up
to C$1 million (US$0.67 million) and also possible payment of three times
any profit made.
"This is a legal issue between my lawyers and the OSC lawyers. It's a
background issue that's been around for over two years. It's not a distraction
to our business. My lawyers are lodging a vigorous defense
and I look forward to finally having a chance to clear my name," he
The legal tussle is clearly not slowing the company down. Corel launched its version
of the Linux operating
system for desktop computers last month at Comdex, the massive industry
trade show held in Las Vegas.
Corel is aiming its Linux version at the average user, not the usual, more
technically sophisticated Linux user. The company is basing the OS
on the non-profit Debian version and hopes to use it to sell
its WordPerfect Office suite of programs.
Regardless which version of the OS is used, Cowpland said the market is
ripe, and he sees plenty of room for Corel and Red Hat to coexist. "We
see Red Hat on the server and us on the desktop. We don't consider
them a competitor. They're an ally."
Corel's recent stock surge has more to do with the company's business
plans than any rumors about the company's potential acquisition, he said.
"Simple fact is Linux is the hottest thing right now. We have more Linux
products out there than any other company, so I think Wall Street is
catching on to that."
Cowpland said Corel is looking at providing Linux software for the Internet
appliance and handheld device markets.
In addition to Linux, he said his firm is making moves in the
hosted applications market as a way to find new non-traditional buyers
for its software, like small- and medium-size businesses.
"We see a lot of interest in ASPs because of the low cost of ownership.
We have made partnerships with application service provider Futurelink. And
Corel owns 20 percent of GraphOn."
GraphOn develops server-based software to centralize and simplify
enterprise computing and enable efficient network deployment of
applications to display devices and platforms. GraphOn markets its
Web-enabling software to application service providers and
independent software vendors.