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Novell Layoffs May Exceed Original Estimates

Offsetting layoffs, Novell is on the hunt for companies focusing on open source software, as well as proprietary software for data centers and identity management.

Novell is looking to both add and subtract people at the same time.

Addressing employees in Germany on Thursday, CEO Ron Hovsepian said he would have to make more employee cuts than he originally expected, according to published reports.

This comes just a day after he pledged that layoffs would exceed no more than 100 employees. Hovsepian didn't say how many more than the original 100 would be let go. Earlier this week, Novell officials denied scattered reports that it would be laying off up to 1,000 employees, which would represent some 25% of its workforce.

"To set the record straight, Novell has consistently stated it will lay off under 100 employees worldwide, on a headcount of about 4,000," a Novell spokesperson said.

One area of the company's operation expected to feel the ax is its internal IT organization, largely based in Provo, Utah, according to the report. That group has been largely responsible for supplying a number of IT implementations mostly involving the company's GroupWise collaboration software, its Zenworks desktop management package, and eDirectory.

On a more optimistic note in another part of the world, Hovsepian this week told reporters gathered in Bangalore, India, that Novell is on the hunt to acquire companies focusing on open source software, as well as proprietary software for data centers and identity management.

Given that acquisitions made by Novell over the past 18 months mostly have been aimed at encouraging interoperability as well as heterogeneous management, Hovsepian's latest statement of direction appears to be consistent with the company's longer-term thinking.

Despite market researchers, including IDC, projecting slow growth in the IT industry for at least the first half of this year, Hovsepian doesn't appear hesitant to spend a little money.

"I think CIOs are going to be reserved in their spending, they are going to be cautious, and then as they start to get into the end of the second quarter, they are going to try to hold off expenses as long as they can," Hovsepian told reporters at the briefing.

This article was edited on 2/6 to add additional statements by Novell.

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