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" Novell Expects up to 90 Percent Open Source Growth


Business News Americas
11/29/04 9:56 AM PT

Novell's strategy will be focused this year on rapid growth through relationships with business partners, so that Latin America revenues can grow by 30 percent in 2006. This means strengthening relationships with channel business partners as well as fortifying alliances with global IT providers such as IBM, HP, Intel and Oracle.


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The Latin American division of US software firm Novell (Nasdaq: NOVL) expects sales of its open-source solutions to grow 70-90 percent this fiscal year, the unit's new president Jose Almandoz told BNamericas.

In January this year, Novell finished its acquisition of German Linux solution provider SUSE and has seen sales double each month. Currently, open-source software represents 10 percent of the company's total sales.

Latin America accounts for nearly 2.5 percent of total revenues, which were US$1.16 billion in the fiscal year ending October 31. "One of our goals for the near future is to increase Latin American participation in the overall figures to 3-5 percent," Almandoz said.


Strengthening Alliances
Regarding overall revenues, Almandoz said his division expects 20 percent growth for this fiscal year, which ends in October 2005. This year's strategy will be focused on rapid growth through relationships with business partners, so that Latin America revenues can grow by 30 percent in 2006, he said.

This means strengthening relationships with channel business partners as well as fortifying alliances with global IT providers such as IBM (NYSE: IBM) , HP (NYSE: HPQ) , Intel (Nasdaq: INTC) and Oracle (Nasdaq: ORCL) .

Along with the increasing focus on open source , Novell also aims to provide technology solutions for business and identity management solutions. "This is a strategy that Novell has worked with for about 10 years and which all the time we are implementing more effectively in our clients' businesses," Almandoz added.

The company has said previously that it plans to strengthen its operations in Chile, Colombia and Peru.

Key Strategy
"These countries belong to what analysts call 'Tier 1' regarding open source adoption, meaning that there is a high disposition to adopt this technology. And since this is a key strategy for Novell, it is obvious that our presence in these countries is fundamental," Almandoz said.

During 2001 and 2002 Novell closed its offices in these countries but has reopened them over the past 18 months.

"We do have plans to expand in Latin America, but not necessarily in new countries. For instance in Brazil we have offices in Sao Paulo and small operations in Brasilia and Rio de Janeiro which we want to expand. Also Chile, Colombia and Peru are offices that we want to strengthen by adding new members and expanding operations," he said.

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