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Sun 6 Nov 2005 04:00 AM

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Novell Middle East safe from firm’s plan for global shake up

Novell Middle East will escape any job cuts, regardless of whatever plans the company has for its global operations, a spokesperson for the company claimed last week.

Novell Middle East will escape any job cuts, regardless of whatever plans the company has for its global operations, a spokesperson for the company claimed last week.

If anything, the regional operation is looking to add to its headcount here, she added.

Novell was widely reported last month to be planning to cut up to 1,000 jobs in an attempt to restore its financial position.

US newswire Cnet had cited sources close to the company as saying that the firm was looking to slash up to 20% of its 5,800 headcount by the end of its financial year, which closed last month (see IT Weekly, 29 October – 4 November 2005).

However, that deadline had passed last week, with no announcement being made by Novell before October 31.

As IT Weekly went to press, Novell had still yet to make any statement confirming or denying job cuts.

Regardless of the global plans, the situation appears considerably brighter for Novell’s operation here.

According to Bharati Suresh, marketing manager for Novell Middle East, the regional operation in the company’s Dubai-based office has not received any official announcement regarding any cuts as yet.

But she claimed the company has said the regional office will not be scaled back — and indeed might expand.

“Novell has said emphatically that the Dubai office is not to be closed,” Suresh said.

“The company has highlighted its growth regions, which include the Middle East, China and India, and has told us there will not be cutbacks in these areas,” she added.

Suresh claimed that the Middle East operation may be taking on more staff in the future to cope with increased demand in the region, but this is by no means certain. The Dubai Internet City branch of Novell currently employs 13 people, including marketing staff and technical specialists.

According to the Cnet report, Novell may also look to focus more on partner sales in some of the regions it operates in.Here in the Middle East, Novell partners include Al-Masa Network Solutions, Mindware, Aptec and ValueSys.

Novell’s chief executive Jack Messman has said that the firm does need to look at making “some operational enhancements” to drive “further cost reductions and efficiencies” in its operations.

Novell’s cost structure will be better aligned to its strategy as part of its 2006 fiscal year planning, he said last month in a regulatory filing.

While the firm pushed hard into the then-comparatively new field of Linux server sales in 2003 with the purchase of SuSe Linux, it has found it difficult to make that strategy pay off. Its most recent results saw revenue drop by 5%.

Messman too has attracted criticism from the open source co- mmunity for failing to fully understand its potential. Just prior to buying SuSe, Messman claimed that Linux was an “immature operating system” despite the fact that it was already in use in a number of corporations.

Messman was forced to issue a public apology, saying that Linux was indeed capable of handling tough computing tasks.

Having lost out to Microsoft in the corporate server market, where it saw sales of its NetWare product eclipsed by Windows, Novell is now facing the risk of losing out to Linux rival Red Hat.

Last year, Red Hat had captured an estimated 63% of the Linux server market, compared to 20% for Novell.

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