Novell's New CEO Isn't Talking Up A New Game Plan - InformationWeek

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Software // Enterprise Applications

Novell's New CEO Isn't Talking Up A New Game Plan

Hovsepian has moved up fast within the company. Now he's got his turn in charge.

Novell's got a new man in charge. But that may not mean a new strategy.

Ronald Hovsepian, president and COO, was named CEO, taking over from Jack Messman, who was on his second tour as the company's CEO. The struggling software and operating system provider is trying to turn around a financial slide that earlier this month saw its stock drop 23% in a week. Messman, who has been a board member since the company's founding, will give up his board seat in October. CFO Joseph Tibbetts also stepped down. VP of finance Dana Russell will fill the CFO slot while the company looks for a permanent replacement.

While Hovsepian has been a rising star at Novell since joining the company three years ago, it's not clear if his vision for the company differs substantially from Messman's, who oversaw Novell's key $210 million acquisition of SuSE Linux in January 2004. Hovsepian spoke during last week's conference call, but his comments didn't stake out a new direction.

As in the past few years, Novell's priorities are its Linux operating system and its identity and resource management software. "A narrow focus and energetic push" will be critical to Novell's improving its competitive position, Hovsepian said. Its push for new customers will run into market leader Red Hat, among others. Red Hat has tapped the business Linux market to build a company with about a $4.8 billion market capitalization, compared with No- vell's $2.2 billion.

Novell's change at the top "should have happened much sooner," Credit Suisse wrote last week in a report. "Nevertheless, we think there is some time left on the clock for Hovsepian to make his mark." Key questions remain about what he'd like that mark to be.

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