Tuesday, April 18, 2006

Oracle's Linux Push Is a No-Brainer

Oracle's Linux Push Is a No-Brainer My Burton Group colleague Richard Monson-Haefel and I had a fun debate in this context yesterday. He thinks Oracle should acquire Ubuntu or Mandriva; I think Oracle should buy Novell if it wants to have a full (superplatform) stack à la Microsoft. On my short list of reasons:
1. Novell's cash-to-mkt cap ratio is unusual; it topped a recent Business Week list in this context (see the chart on this page; as of the 2006/04/10 BW issue, Novell had a mkt cap of $2.979B and $1.686B cash -- a 57% ratio). This means Novell would be considerably less than a $3B acquisition, while Red Hat would be far more expensive.
2. Novell SUSE has strong momentum in several regions, especially in Europe.
3. Novell has several other product lines that would complement Oracle's portfolio, especially for identity, security, and enterprise messaging.
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