What Microsoft + Novell Means Going Forward

What is Microsoft's impetus behind making this deal? What does the company behind Windows stand to gain from Linux?

What has it always stood to gain, in every deal Microsoft has ever made? When Windows NT was first introduced to the enterprise, analysts predicted some form of the new operating system would inevitably succeed, not because it was good, and not because it was functional, but because at some level, customers needed to run Microsoft Office. For that, they needed Windows. So even if Microsoft were to lose money selling Windows, they concluded, Microsoft could eventually succeed, because Windows is the platform for Office.

But that's not necessarily true any more. Yesterday, Novell CTO Jeff Jaffe threw out a word to the crowd without actually defining it: para-virtualization. Essentially, this refers to the capability for an application running on an operating system that is itself being hosted virtually by another operating system, to know who its own virtual host is. So a Windows app running on Linux would know it's on Linux.

What's the point of that? Conceivably, a future "para-virtualized" version of Microsoft Office could include applications that detect whether they're running in a virtualized environment, on top of Linux. And if they're running on Linux...correction, if they're running on SUSE Enterprise Linux, then conceivably, they could integrate such features as drag-and-drop, clipboard sharing, and file compatibility with Linux applications on the desktop.

The result: Office runs on Linux. What has Microsoft ever stood to gain? Market share.

"What Microsoft is saying is they're going to work to make sure that OpenXML and OpenDocument formats are compatible with Microsoft's new XML-based formats," reports NPD Group's Chris Swenson. "That's a big deal, because it means that you might see more people adopt open source office productivity applications like OpenOffice."

"What's driving this deal from Microsoft's perspective," Swenson continued, "is, if they can get someone in the open source community, especially one that's a Zen backer, to make sure that versions of Windows can run effectively on Zen, it's only going to help Microsoft's bottom line. Let's say someone's running Linux on a server running Zen, they want to virtualize the servers. Microsoft is still going to make the server sale if it's compatible, and works well with Zen."

But how will the end user be concerned? Suppose this end user, proposed Swenson, downloaded a PowerPoint presentation using the new Office 2007 format (.PPTX). "In my Linux, if I drag-and-drop onto the Linux desktop, a) am I going to be able to do that; b) is it going to be able to now be opened in my OpenOffice suite, or if I'm doing any sort of collaboration server, is it going to be able to handle those files effectively, any sort of document management, enterprise content management systems?"

"I think that's why they threw in the document format capabilities, because it's not just [that] I'm going to be working on files within this virtual machine. I might do something outside the virtual machine on the Linux box, and I want to make sure things work nicely. Conversely, if I'm using OpenOffice inside a Linux virtual machine on a Windows box, am I going to be able to take that work and integrate it with Microsoft Office?"

"If you strip away all of the packaging of this announcement, it really is a virtualization play," added Info-Tech's Carmi Levy. "It's a play by both of these vendors to be at the front of the pack as virtualization cements its place in the data center architecture. The more walls that Microsoft and Novell can pull down, and the more seamless they can make that experience for the data center manager, the more likely they will be to sell product into that space."

"There's also a recognition that...the kernel of an operating system is a fairly commoditized thing," Levy continued. "And the Linux kernel is fairly small, efficient, very well-structured and architected. And I think, longer-term, Microsoft is looking at that and thinking, 'Hmm, could there be an opportunity to leverage that Linux kernel with the Microsoft administrative environment on top of that, which is also considered best-of-breed?' So Microsoft might see opportunity in re-allocating some of its server development resources into areas that add more value to the business, as well as to its bottom line. Shareholders want Microsoft to engage in activities that drive differential revenue, that differentiate the company from its competitors, and continued investment in a kernel that is differentially not better than the competition, might not be the way that Microsoft needs to go."

"It really speaks to Ballmer's strategy for going to his opponents and burying the hatchet," remarked Swenson. "Steve Ballmer has systematically gone to every single company that filed a lawsuit against Microsoft, [saying], 'How can we work together? How can we bury the hatchet? How soon can we go forward? How can we help both our customers?' And it's such a brilliant strategy, in my mind, that it's really effective."

At least one lady, however, remains both unhappy and unconvinced. "Novell has found a way to block redistribution, they think," remarked Groklaw's Pamela Jones, "or Microsoft did and Novell either didn't notice or didn't care. So Linux ends up like Unix, essentially written by individual volunteers and then hijacked by the corps. That seems to be the plan."

If there's any agreement to be found today among the experts, it's that Linux today is a much more commercial operating system than it appeared to be last week. And if anyone stands to benefit from this, it's ironically the party that even some of its own proponents had once feared may be left out in the cold.

"As long as the environment is conducive to Microsoft making and selling stuff and making money, then Microsoft is happy," Carmi Levy stated, "and as long as Microsoft still has the ability to control the direction, the trajectory, the pace of that market -- which, clearly, it will through partnerships like this one with Novell -- then Microsoft loses nothing. Microsoft can release its engineers to work on projects that will allow it to be differentially better than its competitors, and it will still have a very strong position in the data center, which is what it's wanted all along."