Antitrusters Nod Attachmate’s Novell Buy, SLES 10 Gets Final Service Pack

April 25, 2011 Timothy Prickett Morgan

NetWare and Linux distributor Novell has managed to get the approval of antitrust regulators in the United States and Germany to sell off 882 patents to a holding company that many in the IT industry regard with suspicion because it is backed by Microsoft, EMC, Oracle, and Apple. And that means the $2.2 billion acquisition of Novell by Attachmate can proceed.

Attachmate announced that it wanted to buy Novell last November, and under the acquisition deal it negotiated, the company said it would be selling off 882 unspecified patents to a company called CPTN Holdings, which was backed by Microsoft and other unnamed parties. Many people immediately suspected that Attachmate was selling off the Unix and Linux family jewels that Novell had itself acquired over the years or NetWare patents it had developed. The former had the potential to undermine the open source Linux market, of course, and with Novell having inked alliances for SUSE Linux and Windows interoperability years ago, the open source community was understandably jumpy about the lack of clarity regarding the CPTN Holdings part of the deal, which raised $450 million for Attachmate and basically meant Attachmate was acquiring Novell for a mere $706.3 million net of cash. That’s less than one year of revenue for Novell.

In a statement put out by the US Department of Justice, the antitrust authorities who could have, along with Germany’s Federal Cartel Office, put the kibosh on the deal said that Microsoft and its friends had modified the patent deal sufficiently to satisfy its concerns. Under the arrangement, Microsoft gets to buy all of the patents it wanted to get its hands on–exactly what they are was not revealed–but has to license them back to Attachmate and is allowed to get royalties for them from EMC, Oracle, or Apple. EMC has agreed not to buy 33 patents relating to virtualization software. In an interesting twist, all of the patents that CPTN Holdings buys from Novell/Attachmate have to be distributed under the GPU General Public License v2 and the Open Invention Network license, the former a champion of open source software licensing and the latter being an open source patent-acquiring organization that seeks to protect the Linux operating system.

“The parties’ actions address the immediate competitive concerns resulting from the transfer of Novell’s patents,” explained Sharis Pozen, deputy assistant attorney general of the Justice Department’s Antitrust Division, in the statement. “To promote innovation and competition, it is critical to balance antitrust enforcement with allowing appropriate patent transfers and exercise of patent rights. Although we recognize that the various changes to the agreement recently made by the parties are helpful, the department will continue to investigate the distribution of patents to ensure continued competition.”

So within a very short period of time, Attachmate will own a modern, enterprise-class operating system. It will be interesting to see what it will do with it.

In a related announcement, Novell has announced the final updated to its SUSE Linux Enterprise Server 10 operating system, which is Service Pack 4. With SP4, as you can see in the release notes, Novell is adding support for the latest Opteron processors from Advanced Micro Devices and the latest Xeon processors from Intel. I have not been able to determine if SLES 10 SP4 supports the new Power7 processors for the Power 750 or the new PS703 and PS704 blade servers announced by IBM two weeks ago, but I can tell you that the new System zEnterprise 196 mainframes are supported. System x servers get a hot-add memory feature in a technical preview, but given that this is the last service pack for SLES 10, it will never come out of preview.

In addition to announcing the final service pack for SLES 10, Novell also said that it was extending the support term for SUSE Linux with something called Long Term Service Pack Support. This extended support, which is only available on X64 and mainframe platforms and which is not available on Power or Itanium platforms, extends the normal SLES support cycle from seven years to 10. The idea is to provide longer support for Service Packs so over the course of a decade companies can jump one or two of them and yet still remain on supported releases. Commercial customers don’t like messing with systems that are working every 18 months or so, which is the update cycle that Novell likes to have for Service Packs.