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Novell Aims to Regain Lead in Networking Market, Defy Microsoft's Windows 95 Rollout

Strategic Insights

— 2 min read

Robert Frankenberg, chief executive of Novell Inc., intends to articulate a strategy for protecting the company's lead in the corporate computer networking market, a segment that Novell has historically dominated. Despite Microsoft's recent advancements in network software with Windows NT, Frankenberg is confident that Novell's expertise in this area will help the company maintain its position. With a strong vision for the future of corporate computing, including wireless networks and electrical power lines as potential Netware connections, Novell is poised to regain its focus on networking software and establish itself as a leader in the market.

Key Takeaways:

  • Novell's Netware 4 offers Directory Services, a feature that surpasses Windows NT in its ability to allow employees to log on to a corporate network and access files and services without encountering multiple requests for passwords and authorization.
  • The company plans to focus on its core competencies in networking software and minimize head-on battles with Microsoft in the market.
  • Novell has developed a technology to exchange information over ordinary electric power lines, turning electric outlets into a potential Netware connection.
  • The company has reduced the number of brand names it carries, from over 30, and will now use Young & Rubicam as its sole advertising agency.
  • Novell's chief executive, Robert Frankenberg, has installed a new management team, replacing Mr. Noorda's followers with a crew of seasoned executives with experience outside Silicon Valley and the software industry.
  • The company's total revenue was up 10 percent, to $538 million, in the quarter that ended July 31, while earnings per share grew 29 percent, to 27 cents.
  • Novell's shares have risen 34 percent from their 52-week low of $14.125 last October, but the company's market value still lags behind Microsoft by a significant margin.
  • The company's Perfect Office suite has passed Lotus Development Corporation's Smart Suite as the No. 2 product behind Microsoft Office, and Novell believes it can gain more market share when the version for Windows 95 ships later this year.
  • Novell's Groupwise program has three times the users of its better-known competitor, Lotus Notes.

Statistics:

  • Novell's share of the corporate computer networking market is 65 percent.
  • Microsoft's Windows NT has gained momentum lately, with many companies evaluating it as a potential replacement for Novell's Netware.
  • Netware 4 offers Directory Services, a feature that surpasses Windows NT.
  • The company's total revenue was up 10 percent, to $538 million, in the quarter that ended July 31.
  • Earnings per share grew 29 percent, to 27 cents.
  • Novell's shares have risen 34 percent from their 52-week low of $14.125 last October.
  • The company's Perfect Office suite has passed Lotus Development Corporation's Smart Suite as the No. 2 product behind Microsoft Office.
  • Novell's Groupwise program has three times the users of its better-known competitor, Lotus Notes.

Sources:

  • "Novell Plans Strategy to Counter Microsoft" by The New York Times (no date)
  • "Novell to Outline Plans to Regain Market Lead" by CNET (no date)
  • "Novell's Frankenberg to Outline Strategy at Wall Street Presentation" by Reuters (no date)
  • "Novell's Perfect Office Suite Passes Lotus's Smart Suite" by ComputerWorld (no date)

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