Dear Corel customer: you might not have a clue as to whether Corel Corp. will extend or dump its Linux operating system. You, unfortunately, will have to wait until mid-January before the Ottawa-based software purveyor comes clean.
Apparently, Corel Corp. doesn’t know at the moment what it plans. The company has hired McKinsey & Co. – a business consultation firm – to address those issues.
For the time being, what befuddled Corel users have been subjected to are alleged misquotes during last November’s Comdex conference in Las Vegas from Corel’s president and CEO Derek J. Burney, a carefully-worded on-line explanation from the Corel Web site, and the image that all is well in the house Dr. Michael Cowpland once ruled.
During Comdex, reports that Burney said the Corel Linux OS was up for sale swirled, when in fact no official announcement to that affect had been made.
“The livelihood of some of our members depends on the Corel Linux platform,” stated Rob Black, president of the Canadian Information Processing Society (CIPS), Toronto Section. “The impact of a potential sale by Corel of its Linux platform is very large…Corel is big enough to have a dramatic impact and it raises many questions.”
What Black and the 8,000 information systems professional members are concerned with are rumours that Corel will sell off its Linux operating system platform in part or in whole, and thus provide no suitable alternative operating system to the Microsoft Windows platform. Without Linux, CIPS warned that the industry will have no choice but to succumb to the Microsoft monopoly. A further sore point with CIPS members – should the demise of Corel Linux come to pass – is the time and money they’ve invested in adopting the OS.
“They (Corel) have a good Linux product and it’s helped boost Linux awareness around the world,” Black continued. “For Corel to go in another direction now would not be good for Linux…if Macintosh didn’t make its own software for its computers, what do you think would happen to Mac computers? It’s the same situation.”
No threat
Microsoft purchased about US$135 million worth of Corel’s ailing stock last October, leading to speculation that Corel’s Linux OS – which thus far has failed to take a strong foothold in the U.S. despite being touted as the ideal version for new users – could be up for grabs.
But Corel was quick to assure the media and its user base that neither Linux or any of its software offerings was threatened with extinction as a result of the technology deal with Microsoft.
“On the Linux front, we have aggressively pursued development efforts in order to give our customers the maximum flexibility and choice they require,” read an on-line statement from Burney dated November 2000. “At Comdex, we are featuring not only the new and enhanced version of our Linux distribution – Corel Linux OS, second edition – but the suite of applications we offer on the Linux platform, WordPerfect Office 2000 for Linux and CorelDRAW Graphics Suite for Linux.”
Corel turned down repeated requests from ComputerWorld Canada to comment.
An exasperated Black wasn’t surprised to hear of Corel’s tight-lip policy. Communications between the two organizations have become tenuous of late, with Corel cancelling its scheduled appearance before CIPS members to discuss the Linux conundrum.
“We’ve been asking for clarification as far back as October,” Black said. “They had originally accepted our invitation to come and speak to our members and then all of a sudden they cancelled. All I’ve been told is that they’ve hired a consultant and they are reviewing their entire business strategy. I have no idea at this moment what they’re going to do, I was told we’d have to wait until mid-January.”
If Corel is mulling over the possibility of selling off its stake in Linux, their timing is curious. On Nov. 29 the Ottawa Citizen trumpeted the Linux OS as growing in popularity.
“Linux is now becoming really important … it has been adopted by the entire industry,” Burns MacDonald, a senior consultant with CGI Group Inc. in Ottawa, told the Citizen. MacDonald added the Linux fervour was also grabbing the attention of networking giant Oracle, which is being pressured by some of its clients to port its systems to Linux.
Much speculation
Kevin Restivo, an industry analyst with IDC Canada in Toronto, said he thinks Corel is merely in the midst of restructuring itself in order to ensure independent longevity.
“I’d be surprised if Corel sold off its Linux operations. They’ve already staked a lot into Linux and they are a pioneer in bringing Linux to the desktop.
“I think they’ll want to extend that service and expand it to handhelds and other areas where Linux is still growing,” he said. “There has been a lot of speculation that a sell off is being prompted by Microsoft; I say ‘nay’ to that. If Microsoft took total ownership of the company that’d be a different story.”
If Corel is planning to unceremoniously dump Linux, they’re giving precious little warning to their user base. Black added Corel refused to confirm or deny whether its brand of Linux would still be on the table for the next 2Q. During Comdex, Canada’s top software company released new versions of CorelDRAW, WordPerfect Office 2000 and the Linux OS itself. Plus, the company’s on-line statement announced the release of new Linux products.
But despite on-line assurances to the contrary, one former Corel employee who left the company last autumn on her own power, said it’s no big secret in Corel’s hallowed halls that the Linux OS is a loser.
“Linux was [Cowpland’s] vision, not [Burney’s] so it makes complete sense that he would dump it,” said the former employee who would only identify herself as Sarah. “It (Linux) never made Corel any money anyway. To the contrary, it was a money pit. If Corel is going to stay alive, it needs to concentrate on it’s core competencies (in graphics software) and [Burney] knows it.”
Sarah said the widely held belief amongst Corel employees – past and present – is that if Corel DRAW 10 doesn’t pull down strong sales figures by the end of February that Linux will be on the auction block.
“The problem is, Linux hasn’t penetrated any critical mass within the larger markets outside of the geeks and prosumers,” she told ComputerWorld Canada. “If DRAW doesn’t pull Corel out of the fire by the end of the first quarter they’re in big trouble…Linux is still hot in certain marketplaces so it’d be easy to dump it for cash and concentrate on what Corel is good at – whether they want to admit it or not – consumer graphics software.”
She added the Ottawa company hasn’t been forthcoming with the number of employees it has either, suggesting there are only 500 live souls running the business as opposed to the 1,000 it allegedley announced.
Corel Corp. has laid off hundreds of employees in recent months, including 320 workers from its Dublin headquarters last June and 139 from its main headquarters in Ottawa last September.
