Jon pointed out in his "crystal ball" post that we would have more to say about the Microsoft-Novell alliance. I had the chance to talk to Microsoft yesterday and was just about to put fingers to keyboard when a journalist came emailing with a request for my thoughts, which I thought I would share (it's Saturday after all):

From Microsoft's perspective, I see this deal as a continuation of the pragmatic approach that Microsoft has been taking with the open source community—JBoss, SugarCRM, Zend etc—with a little extra intellectual property (IP) spice. Microsoft has gradually evolved from a stance that open source is a cancer created by communists to something which they must embrace (but not extend!), culminating in this strategic alliance. Microsoft recognises that open source software is part of the landscape for its customers and it is better to work with it and, for example, have JBoss running on Windows rather than Linux and Zend working with SQL Server rather than with DB2 or Oracle. In the case of the Novell deal, Microsoft's customers have undoubtedly been raising concerns about the potential threats of litigation as a result of deploying Linux and Microsoft has responded. One of the challenges for Microsoft in this regard is the implications around the GPL (as discussed by Eben Moglen, attorney of the Free Software Foundation) and so it has chosen not to cross license the IP but rather to indemnify customers using SUSE Linux. Microsoft said to me that Novell is the only company which can truly claim to be able to indemnify Linux customers, which is a clear indication that they believe there is Microsoft IP in Linux and must raise concerns about other distributions, such as Red Hat and Ubuntu. The deal with Novell is not exclusive so it will be interesting to see if Red Hat comes knocking on the Redmond door: I am sure Microsoft would welcome them. Contrary to some commentary, Microsoft's commitment to offer customers SUSE Linux support coupons does not amount to a blanket reseller relationship: the coupons apply specifically to SUSE Linux running as a virtual guest in a Microsoft operating system host or vice versa. This goes back to my point about Microsoft wanting to maximise the Windows opportunity.

From Novell's perspective this is also a pragmatic move, given their poor showing in the enterprise compared to Red Hat. Whilst there has been a lot of concern raised in the open source community (here for example) because Novell is effectively paying royalties to Microsoft for its IP and has been characterising Novell as a ‘selling out’, I think this has to be viewed from the perspective of Novell as a commercial entity. Novell did win some concenssions with respect to the open source community in terms of the indemnification of individual, non-commercial developers. Not that I think it would ever have made sense for Microsoft to sue them: it's more of a symbolic gesture.

Ultimately, I think the key beneficiaries here are organisations grappling with the reality of their heterogeneous IT environments. They now have greater choice with reduced risk and the potential for increased interoperability (and prospects of cross platform .NET development based on Mono).

The technical aspects of the announcement around virtualisation, management and document formats are really a continuation of existing work, with the additional commitment of resources from both companies. The Open XML-ODF interoperability between Office and OpenOffice is significant (but something that Novell had been working on anyway as part of its involvement in the Open XML standardisation process at ECMA). This leaves the likes of Sun and IBM in an interesting position given
that they have been promoting ODF as an alternative to Open XML/Office: Novell is now embracing with OpenOffice.

The announcement in some ways parallels that betwen Microsoft and Sun in 2004. The difference here, I think, is the motivation. In the case of Microsoft-Sun, the primary motivation was to deal with the litigation issues hanging over Microsoft and as a result there has been comparatively little of substance for technology adopters, as I discussed here. The Microsoft-Novell alliance is not about litigation (the anti-trust suit related to WordPerfect and Quattro Pro continues): it's partly about IP but primarily from a customer (and Novell perspective) about the need to serve their mutual customers better. It will be interesting to revisit this in a year or so and see whether this translates into more tangible outcomes in terms of virtualisation, management and document interoperability.

Finally, there has been speculations that this was motivated by Oracle and its Unbreakable Linux announcement. Whilst this may have accelerated proceedings (Microsoft's Tech-Ed Developers and IT Forum conferences take place in the next couple of weeks), the reality is that these sort of alliances—particularly where complicated intellectual property issues are concerned—take more than a couple of weeks. It certainly throws a spanner into the Ellison works but I see that as more of a beneficial side effect. I am equally sure, though, that the implications for Red Hat figured in the thinking of both companies.