Somehow, I suspect that having Microsoft hand out coupons for Suse Linux upgrades is not the biggest benefit Novell sees in its startling deal with Planet Windows. Trouble is, I don't see what the biggest benefit is. The news story announcing the deal makes the benefit for Microsoft crystal clear--it gets a major boost into the red-hot technology of server virtualization, an area where it has lagged. But what does Novell get? One of the deliverables in the deal may hold a clue: a "patent covenant" in which Microsoft promises not to sue Novell and its customers for using Microsoft-patented technology in Linux. So that's what Novell gets--blackmailed.

The deal is an interesting chess move on Microsoft CEO Steve Ballmer's part. It resuscitates his threats of the past year about how Microsoft has the patent rights to sue the pants off the Linux penguin--and does it in a way that gives him some credibility. If one of the top Linux vendors cops a plea, maybe Sheriff Steve has got the goods on the rest of the bunch. By telling Novell Suse customers not to worry, he's telling companies running their servers on other Linux distros to be very, very worried.

I'm sure Novell CEO Ron Hovsepian loves that thought. He may be in Microsoft's pocket, but hey, that's where the money is. Being the Linux that virtualizes best on Microsoft servers could be a great selling point for a company like Novell. The problem is, there's no guarantee it will happen. VMware, not Microsoft, still knows the most about virtualizing servers.

While Ballmer and Hovsepian talked up how their two companies would compete and work together at the same time, neither of them used the word "coopetition," which is too bad because it's what instantly comes to mind (and it was coined by Ray Noorda, founder of Novell). Microsoft's track record on coopetitive relationships is mixed--it continues to develop Microsoft Office for the Macintosh, for example, while fighting Apple tooth and nail on operating systems and now media players. On the other hand, Microsoft is doing less well these days with Adobe and any company that sells a security product. Microsoft historically has had trouble distinguishing between its friends and its dinner.

Still, this deal has forced Steve Ballmer to say the "L" word without spitting afterward. If Microsoft is going to work with Novell to develop virtualization technology and provide sales support for a particular version of Linux, but at the same time it still threatens to sue anybody who runs Linux, that could be good for Novell and its customers in the short term. But what does that mean longer term? Could it mean that one day, when all the lawsuits have settled, Microsoft will buy the only Linux vendor left standing, Novell, and make Linux a Microsoft operating system?