Novell retools for the Internet

Corporate software provider Novell has long been known as a builder of operating system technologies and associated tools for businesses. But with its former flagship software product, NetWare, losing market share to Microsoft's Windows and to Linux, the firm has turned to the Internet.

Armed with a set of new technologies, Novell is attempting to convince skeptics it can provide compelling tools for the Web, just like the average Internet start-up. The firm announced this week that Tucows.com, a Web distributor of software and Internet addresses, will utilize its "DigitalMe" personal information tool for computer users as well as its back-end directory services software, or NDS--the key to Novell's rebound strategy.

Novell executives anticipate DigitalMe, a new client tool for messaging across corporate networks, a free email test site and other gadgets can showcase the company's specialty: Heavy duty back-end software that most Web surfers never see.

"For the masses out there, Novell clearly doesn't have the name recognition of a Microsoft," said Dwight Davis, analyst with market researcher Summit Strategies. "It's an uphill battle for Novell."

As an example of Novell's Net embrace, DigitalMe provides a client software component that allows a Web surfer to log onto a site and access information without having to fill out registration forms or other password information. DigitalMe stores this type of information, much like Microsoft's Passport technology, so computer users can maintain a single password or sign-on name across a variety of Web sites.

The key to the DigitalMe technology rests in its ties to Novell's directory services software, or NDS, which provides the database for a user's information. But few have traveled where Tucows.com has chosen to go thus far, endorsing DigitalMe and NDS.

Executives from the Internet firm said that as a strategy to gain ubiquity, DigitalMe shows promise, but it can also benefit the average Web surfer even if adoption has yet to take off. That means even a single Web site, like Tucows.com, reaps benefits even if a surfer can't use DigitalMe on another site, according to executives.

"This is something that has huge network effects associated with it," said Elliot Noss, chief executive at Tucows.com. "But, frankly, we were tired of waiting."

Novell is clearly taking its cues from chief executive Eric Schmidt, a technologist at heart who seems to have imbued a sense of creativity in the company that was sorely lacking in the NetWare-centric past. "I'm tired of the old thinking in the industry," Schmidt said in an interview this week.

Novell also released a software tool this week for sending instant messages across corporate networks, dubbed "instantme," and has been running a free email test site, called myrealbox.com, for some time. An initiative is also under way to provide greater Web browsing security through a tool called an "SSL-izer." Another technology, code-named "Aquarium," aims to synchronize personal files over the Internet using a browser and Novell's NDS technology.

Latching on to the idea of "Internet computing"--as championed by the likes of Oracle and Sun Microsystems--may alter the perception Novell is purely an operating system provider, but it also could confuse its sprawling base of customers. Executives took great pains this week to make it clear the NetWare franchise will continue to flourish, despite Novell's strategies for new markets and its increasing reliance on NDS as its flagship technology.

"When we do something else at Novell, people think we're de-emphasizing NetWare," said Stuart Nelson, chief operating officer at the company. "It's just a natural evolution."

But some see Novell casting about randomly for Net niches it can get a foothold in. Having added Net technologies late in the game, Novell remains in catch up mode, hoping to shed its roots as an esoteric corporate software provider.

"I think Novell has to decide what it wants to be when it grows up," said Jamie Lewis, chief executive for industry consultants the Burton Group.