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August 25, 2008

Chalk this one up to the 'Strange and Unusual Dept.' at the Redmond software giant. As part of a controversial partnership deal between two companies, in 2006, Microsoft agreed to buy for up to $240 million worth of Linux support vouchers for Novell's SUSE Linux operating system. Today, Microsoft is buying even more, to the tune of another US $100 million. Are we missing something here?

Microsoft actually resells the same vouchers to customers that are looking to run mixed installations of Windows and... well SUSE Linux systems, what else?

This very unusual scenario in which the world's dominant proprietary software maker is actually helping to market an open-source operating system that's a rival to Windows began a little over eighteen months ago, when Microsoft and Novell signed their initial patent cross-licensing and software interoperability deal.

The once-bitter rivals -- which are still facing off against each other in an antitrust lawsuit that Novell filed more than four years ago -- jointly announced on Aug. 21 that Microsoft has committed to purchase up to $100 million worth of additional Linux support vouchers from Novell, starting in November.

By actually entering into such an agreement in the first place, Microsoft is acknowledging that many of its corporate users are also fans and supporters of open-source software themselves.

And to prove that point, the two companies said last week that no less than $157 million worth of SUSE Linux support vouchers had been already redeemed by Microsoft customers as of May 31, 2008.

Susan Hauser, general manager of strategic partnerships and licensing at Microsoft actually confirmed that some of the subscription support vouchers have been sold to customers for less than their full face value. However, she did say that Microsoft hasn't given any of them away for free neither.

According to Novell and Microsoft, customers that have acquired vouchers for SUSE Linux support subscriptions include Wal-Mart, HSBC Holdings, Renault, Southwest Airlines and BMW. Must we remind you that these are first and foremost Microsoft customers, not Novell...

In all, approximately 102 companies have redeemed vouchers to this date, with a good percentage of them being new customers for Novell, said Susan Heystee, v.p. and general manager of global strategic alliances at Novell.

Although the deal with Microsoft has actually boosted Novell's bottom line and helped the company make some rather impressive inroads against Linux market leader Red Hat, Novell's total revenue has risen only slightly since 2006.

Source: E-Business News.

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