Microsoft and Novell Expand Successful Interoperability Relationship

Additional resources, training and investments to address growing customer demand.

WALTHAM, Mass.-August 20, 2008-Microsoft Corp. and Novell Inc. are announcing an incremental investment in their relationship to meet accelerating customer demand for their business model solution, which is designed to build a bridge between open source and proprietary software to deliver interoperability and intellectual property (IP) peace of mind for organizations operating mixed-source IT environments.

The investment focuses on enhanced programs from Novell to provide tools, support, training and resources for customers seeking an enterprise-class Linux* platform and specifically, the optimal interoperability solution between Microsoft Windows Server and SUSE® Linux Enterprise Server from Novell®. It also includes Microsoft’s commitment to purchase up to $100 million in certificates that those customers can redeem for expanded support from Novell that includes SUSE Linux Enterprise Server support and support for moving toward an enterprise-class Linux platform. The investments will take effect Nov. 1, 2008, and between now and then Microsoft and Novell will solicit customer input and identify aspects of the support programs that will be most useful to organizations running mixed-source environments.

Customer response to the Microsoft-Novell model has been significant since it began in November 2006. As part of the initial five-year partnership agreement, Microsoft purchased $240 million of Novell certificates to sell to customers. Within 18 months, Novell invoiced more than $157 million in certificate revenues, or 65 percent of the original allotment. Customers who have already taken advantage of this opportunity to seamlessly run both Windows Server and SUSE Linux Enterprise Server include Wal-Mart Stores Inc., HSBC Holdings, Renault, Southwest Airlines Co., BMW and many other leading companies around the world.

"The collaboration between Microsoft and Novell has been built on our desire to meet our customers’ real-life IT requirements as well as give our partners greater breadth in their solution offerings," said Kevin Turner, chief operating officer at Microsoft. "Some customers have told us they want to be able to run Windows Server and Linux together seamlessly, but in many cases, they need help with the transition to SUSE Linux Enterprise Server from other Linux environments. Our increased investment in the relationship with Novell is intended to give these customers and partners the best possible Windows-Linux interoperability solution, while also extending their existing Windows Server investments and helping to give them IP peace of mind."

"Cross-platform interoperability is something that we all want and need to achieve. But it’s difficult to accomplish this," said Ulrich Koch, Head of License Management T-Systems Enterprise Services. "The pragmatic approach Microsoft and Novell are taking to address this complex challenge, including IP assurance, through engineering as well as offering tangible support and training programs, will make it easier for us to develop a path forward."

"The strategic partnership between our companies continues to attract customers by building a bridge between proprietary and open source software," said Ron Hovsepian, president and CEO of Novell. "The interoperability delivered by Microsoft and Novell has resulted in very high demand for SUSE Linux Enterprise from customers and channel partners, further validating Novell’s Linux strategy."

With today’s announcement of the enhanced relationship, customers will continue to realize unprecedented choice and flexibility of running both SUSE Linux Enterprise Server and Windows Server with the confidence that both operating systems will work together seamlessly in the datacenter. Novell and Microsoft, through their joint interoperability lab in Cambridge, Mass., and other initiatives, will continue their close technical collaboration on a wide variety of solutions including virtualization, systems management, directory and identity federation, document format compatibility, accessibility technology, and the Moonlight multimedia framework.

More information about the Microsoft and Novell agreement can be found at http://www.moreinterop.com.

About Novell
Novell, Inc. (Nasdaq: NOVL) delivers the best engineered, most interoperable Linux platform and a portfolio of integrated IT management software that helps customers around the world reduce cost, complexity and risk. With our infrastructure software and ecosystem of partnerships, Novell harmoniously integrates mixed IT environments, allowing people and technology to work as one. For more information, visit www.novell.com.

About Microsoft
Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

Novell and SUSE are registered trademarks of Novell Inc. in the U.S. and other countries. *Linux is a registered trademark of Linus Torvalds.The names of actual companies and products mentioned herein may be the trademarks of their respective owners.